**UNITED
        STATES**
 **SECURITIES
        AND EXCHANGE COMMISSION**
 **WASHINGTON,
        D.C.**
 
 **FORM
        10-KSB**
 (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, 2006,
                  or
 
 
 ___
              Transition
                  report pursuant to Section 13 or 15(d) of the Securities Exchange
                  Act of
                  1934
 
 Commission
        file number 0-21555
 
 **AMASYS
        CORPORATION**
 (Name
        of Small Business Issuer in its charter)
  
 Delaware
              
              54-1812385(State
                  or other jurisdiction
              
              (I.R.S.
                  Employerof
                  incorporation or organization)
              
              Identification
                  No.)




625
        N. Washington Street, Suite 301, Alexandria, Virginia 22314
 (Address
        of principal executive office)
 
 Issuer’s
        telephone number, including area code: (703) 797-8111
 
 Securities
        registered pursuant to Section 12(b) of the Act: None
 
 Securities
        registered pursuant to Section 12(g) of the Act:
 
 Common
        Stock, par value $0.01 per share
 (Title of class)
 
 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 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 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 registration is a shell company (as defined by
        Rule
        12b-2 of the Exchange Act) Yes   No X
 
 The
        Company knows of no trading in its Common Stock since its
        inception.  As of June 30, 2006, there were 1,775,880 shares of stock
        held by non-affiliates.
 
 As
        of June 30, 2006, 2,207,350 shares of the common stock of the registrant
        were
        outstanding.
  
 
 **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.  As of June 30, 2006, AMASYS had a 16% interest in
        Comtex and less than a 1% equity interest in Analex.  The Company’s
        business is the maintenance of its equity interest in and note receivable
        from
        Comtex and equity interest in Analex.
 
 On
        July 2, 2001, the Company filed the following reports with the Securities
        and
        Exchange Commission (the “SEC”):  Annual Report on Form 10-K for the
        year ended June 30, 2000; the Quarterly Report on Form 10-Q for the quarter
        ended September 30, 2000; the Quarterly Report on Form 10-Q for the quarter
        ended December 31, 2000; and the Quarterly Report on Form 10-Q for the quarter
        ended March 31, 2001.  Prior to these filings, the Company had not
        filed reports with the SEC except for a Form 8-A, filed in October 1996,
        for
        registration of its common and preferred shares of stock, and a Form 12B-25,
        filed in December 1996, in which it disclosed that it was unable to file
        its
        Form 10-Q for the quarter ended December 31, 1996 because of the difficulty
        associated with the preparation of the Company’s initial financial statements as
        successor to Infotech.  The Annual Report on Form 10-K for the year
        ended June 30, 2002 was timely filed.  The Annual Report on Form 10-K
        for the year ended June 30, 2003 was filed on November 7,
        2003.    All subsequent annual and quarterly reports of the
        Company through the June 30, 2006 reporting period have been filed with the
        SEC,
        and the Company intends to file all subsequent quarterly reports with the
        SEC as
        soon as possible.
 
 Overview
 
 AMASYS
        is the successor to Infotech, pursuant to Infotech’s bankruptcy
        proceeding.  AMASYS’ primary assets are its equity interest in and
        note receivable from Comtex and equity interest in Analex.  AMASYS
        owns 16% of the outstanding equity of Comtex, while the remainder is publicly
        owned.  Comtex is a leading wholesaler of electronic real-time news
        and content to major financial and business information
        distributors.  On December 9, 2003, the Company executed an amendment
        to the Note for the purpose of reducing the conversion price at which the
        Amended Note may be converted into common stock of Comtex.  Pursuant
        to this Third Amendment, the Company agreed to subordinate the Amended Note
        to
        both Comtex’s note payable to its former landlord and to a bank financing
        agreement.  In consideration for these subordination agreements,
        Comtex agreed to reduce the conversion price stipulated in the Amended Note
        from
        the previously-stated conversion price of $1.20 per share to $0.75 per share,
        and to increase this conversion price by $0.05 every one hundred and eighty
        (180) days thereafter, until June 9, 2008 when the conversion price will
        reach a
        cap of $1.20 per share.  This will be the final increase before the
        Note matures on July 1, 2008.  In addition to its 16% equity ownership
        of Comtex, the Company also holds a note receivable in the amount of $856,954
        from Comtex (the “Note”).  The carrying value of the Note, net of a
        $170,427 discount is $672,336.  As of June 30, 2006, the Company has
        recognized losses in excess of basis as an adjustment to the basis of the
        Note
        of $14,191.  The Company also owns 31,000 shares of common stock of
        publicly-held Analex, a defense contractor specializing in developing
        innovativetechnical
        intelligence and biodefense solutions in support of U.S. national
        security.  As of June 30, 2006, Analex had 16,732,890 shares of common
        stock outstanding.  The Company believes that, by virtue of an
        exemption to the Investment Company Act of 1940 (“1940 Act”), the Company should
        not be deemed to be an “investment company” and, accordingly, should not be
        required to register as such.  The rules and interpretations of the
        SEC and the courts relating to the 1940 Act and to its exemptions are highly
        complex and uncertain in numerous aspects.  As a result, no assurance
        can be given that the Company will not be deemed an “investment company” for
        purposes of the 1940 Act and be required to register as an investment company,
        in which case the Company could be subject to legal actions by regulatory
        authorities and others and could be forced to suspend or terminate
        operations.  The costs of defending any such action could constitute a
        material part of the Company’s assets.
 
 2
 Comtex
        News Network, Inc.
 
 The
        Company owns 2,153,437 shares of common stock of Comtex (SEC File No.
        0-10541).  Comtex trades on the OTC Electronic Bulletin Board under
        the symbol CMTX.Comtex
        is a leading wholesaler of electronic real-time news and content to major
        financial and business information distributors. Comtex enhances and
        standardizes news and other content received from more than 65 newswire services
        and publishers in order to provide editorially superior and technically uniform
        products to its customers.  Its customers then package, integrate and
        distribute Comtex products to their end-users.  Comtex processes more
        than 25,000 unique**real-time news stories each day.  For
        each news story, processing includes, adding stock ticker symbols, indexing
        by
        keyword and category, and converting the diverse publisher materials and
        formats
        received into XML, the industry standard delivery format.
 
 The
        demand for news and content distribution paralleled the tremendous growth
        of the
        Internet during the late 1990’s.   Similarly, the subsequent
        collapse of Internet-related businesses has resulted in business consolidation
        and failures, the decline of individual investor web sites, and the erosion
        of
        royalties from corporate solution providers.  Given these market
        conditions, toward the end of fiscal year 2003, Comtex commenced a thorough
        evaluation of its market position, product line, pricing and technology
        strategies as part of an overall strategic revitalization plan.
 
 Comtex
        relies heavily on third-party
        information sources for the content of its product
        offerings.  Interruption in, or the termination of, service from a
        significant number of its information sources would affect Comtex’s ability to
        offer products or maintain product quality.  Accordingly, the failure
        or inability to restore or replace such interrupted or terminated services
        could
        have an adverse effect on Comtex’s revenues.
  3
  Comtex
        also relies heavily on third party providers for telecommunications, electrical
        power, Internet connectivity, and related or similar services as well as
        system
        redundancy for the development and delivery of its products.  Failure
        of, interruption in, or the termination of, these services would also affect
        Comtex’ ability to create and deliver products.  Accordingly, the
        failure or inability to restore or replace such interrupted or terminated
        services could have an adverse effect on Comtex’s revenues.
 
 Comtex
        is a publicly-traded company and more information concerning the operations
        of
        Comtex can be found in its own filings with the SEC.
 
 Analex
        Corporation
 
 The
        Company owns 31,000 shares of the
        common stock of Analex (SEC File No. 0-5404), which trades on the American
        Stock
        Exchange under the symbol NLX.  Analex specializes in developing
        intelligence, systems engineering and biodefense solutions in support of
        national security.  Analex focuses on designing, developing and
        testing aerospace products and systems; developing innovative technical
        solutions for the intelligence community; developing medical defenses and
        treatments for infectious agents used in biological warfare and terrorism;
        and
        analyzing and supporting defense systems.
 
 Employees
 
 At
        June 30, 2006, the Company used the services of two consultants, both of
        whom
        serve as officers of the Company.  The Company has no
        employees.
 
 **Relationship
        With The Pension Benefit Guaranty Corporation (“PBGC”)**
 
 As
        previously discussed (see “Company
        History”), pursuant to the confirmed orders of the United States Bankruptcy
        Court for the Southern District of New York (the “Court”), entered on June 23,
        1994 and finalized on January 2, 1997, Infotech’s Third Joint Plan of
        Reorganization, dated March 30, 1994, as amended (the “Plan”), was confirmed,
        and the Company and Infotech entered into an Assignment and Assumption
        Agreement, dated October 11, 1996, and effective as of June 21, 1996, whereby
        the Company acquired certain assets and assumed certain liabilities of
        Infotech.  As called for by the Plan, the Company issued to the PBGC,
        196,000 shares of the Company’s 5% convertible preferred stock (Series “A”
Preferred Stock), convertible into 1,960,000 shares of the Company’s common
        stock.
 
 Furthermore,
        the Company entered into an agreement with the PBGC granting PBGC certain
        rights.  In addition to the issuance to the PBGC of the Company’s
        Series “A” Preferred Stock, the Company:
 
 1)
              issued
                  to the PBGC a $1,500,000 zero coupon note effective June 21, 1996,
                  for
                  which a settlement was reached (“Settlement”) in which $189,998 was paid
                  in full satisfaction of such note on February 1,
                  2002.
  4
  2)
              granted
                  the PBGC the right to name two members to the Boards of Directors
                  of both
                  the Company and Comtex, which right was waived by the PBGC in the
                  Settlement; and
 
 3)
              granted
                  the PBGC the unilateral right, through December 31, 2001, which
                  has since
                  expired, to require the Company to use its best efforts to liquidate
                  the
                  Company’s interest in Analex and Comtex through secondary offerings and
                  private sales.
 
 On
        August 18, 2005, the Company was notified by PBGC that all of the Series
        A
        Preferred Stock owned by PBGC was sold to a third party.
 
 **Subsequent
        Events**
 
 On
        September 26, 2006, AMASYS signed an agreement to acquire all of the shares
        of
        common stock of World Mineral Corporation, a Nevada corporation (WMC) from
        WMC
        shareholders in exchange for an aggregate of 14,775,000 newly issued shares
        of
        AMASYS common stock.  As part of the contemplated transaction, AMASYS
        has signed agreements to redeem and convert all of its outstanding Series
        A
        Preferred Stock.
 
 Following
        the closing of the
        contemplated transaction, WMC will become a wholly-owned subsidiary of AMASYS
        and the newly issued shares held by WMC will represent approximately 74%
        percent
        of the total outstanding shares of common stock of AMASYS.
 AMASYS
        also executed agreements on September 25, 2006 to redeem from the holders
        of its
        Preferred Stock, pro rata to their respective ownership interests, 55,209
        shares
        of AMASYS Series A Preferred Stock (the “Series A”) in consideration for: (a)
        AMASYS’ entire interest in the outstanding promissory note in favor of AMASYS
        made by Comtex News Network, Inc. (Comtex) in the principal amount of $857,000;
        and (b) 2,153,437 shares of Comtex common stock.  Pursuant to the
        agreement, the holders of the Series A converted the balance of the Series
        A
        shares, together with any and all rights to accrued but unpaid dividends
        thereon, into 2,111,860 shares of AMASYS Common Stock.  Therefore,
        effective September 25, 2006, AMASYS no longer owns the promissory note made
        by
        Comtex and AMASYS no longer holds any shares of Comtex common
        stock.
 
 On
        November 15, 2006, C.W. Gilluly, the president of the Company, exercised
        his
        options to purchase 350,000 restricted shares (out of a total of 900,000
        options) and the Company issued 350,000 restricted shares to him.  The
        remaining 550,000 options expired on November 16, 2006.
  On
        May 24, 2007, the Company borrowed $10,000 from Private Capital Group, LLC
        at
        WSJ Prime + 1.75% maturing on or before December 31, 2007.  The
        Company also promised to grant to Private Capital Group, LLC 1,000,000 shares
        of
        restricted common stock and to issue a Warrant to Private Capital Group for
        an
        additional 1,000,000 shares of restricted common stock at an exercise price
        of
        $0.01 per share as inducement to Private Capital Group, LLC to make the
        loan.  There are 2, 207,350 shares of common stock outstanding at June
        30, 2006.   Private Capital Group, LLC is affiliated with World
        Mineral Corporation, which signed the Agreement and Plan of Share Exchange
        by
        and among AMASYS Corporation, World Mineral Corporation and the shareholders
        of
        World Mineral Corporation, dated September 26, 2006.
 5
 On
        May 24, 2007, the Company borrowed $10,000 from C.W. Gilluly at WSJ Prime
        +
        1.75% maturing on or before December 31, 2007.  The Company also
        promised to grant to Mr. Gilluly 1,000,000 shares of restricted common stock
        and
        to issue a Warrant to Mr. Gilluly for an additional 1,000,000 shares of
        restricted common stock at an exercise price of $0.01per share as inducement
        to
        Lender to make the loan.  There are 2, 207,350 shares of common stock
        outstanding at June 30, 2006.
 
 As
        previously reported, Director Robert F. Delaney retired from the board of
        directors effective November 26, 2006.
 
 **Item
        2.                                Properties**
 
 The
        Company owns no real
        estate.  The Company leases certain space from Comtex on a
        month-to-month basis.  During fiscal 2006, the Company incurred $3,632
        to Comtex for the pro rata portion of its office and administrative expenses
        to
        Comtex for its use of the facilities at 625 N. Washington Street, Alexandria,
        Virginia.
 
 **Item
        3.                                Legal
        Proceedings**
 
 AMASYS
        has no outstanding, material legal proceedings.
 
 **Item
        4.                                Submission
        of Matters to a Vote of Security Holders**
 
 None.
  6
  **PART
        II**
 
 **Item
        5.                                Market
        for Registrant’s Common Equity and Related Stockholder
        Matters**
 
 The
        Company’s Common Stock, par value
        $.01 per share (“Common Stock”), has not traded since its initial registration
        on Form 8-A with the SEC.  There is no established public trading
        market for the Common Stock.
 
 The
        approximate number of holders of
        record of the Company’s Common Stock as of June 30, 2006 was 669.
 
 The
        Company has never declared or
        paid a cash dividend on its Common Stock and does not anticipate the declaration
        or payment of cash dividends to shareholders in the foreseeable
        future.
 
 The
        Company does not have any equity
        compensation program that was not approved by stockholders, other than its
        employee stock option plan.
 
 Set
        forth below is certain information
        as of June 30, 2006 regarding equity compensation to directors and executive
        officers of the Company that has been approved by stockholders.
 
 **Equity
                  compensation**
                **plans
                  approved by**
                **stockholders**
              **Number
                  of securities to**
                **be
                  issued upon exercise of**
                **outstanding
                  options and**
                **rights**
              **Weighted
                  average**
                **exercise
                  price**
              **Number
                  of securities**
                **remaining
                  available for**
                **issuance
                  under plan**Stock
                  Option Plan
              900,000
                  (1)
              $0.01
              50,000Total
              900,000
              $0.01
              50,000
  (1)  Options
        to purchase 50,000 shares of common stock expired during fiscal year 2003
        pursuant to their terms.
 
 **Item
        6.** **Management’s
        Discussion and Analysis of Financial Condition and Results of
        Operation**
  
 The
        following discussion and analysis of our financial condition and results
        of
        operations should be read in conjunction with our financial statements and
        related notes appearing elsewhere in this report.  This discussion and
        analysis contains forward-looking statements that involve risks, uncertainties
        and assumptions.  Actual results may differ materially from those
        anticipated in these forward-looking statements as a result of certain factors,
        including but not limited to the risks discussed in this report.
 
 The
        Company employs no staff with
        financial expertise, rather it relies on part-time outside professionals
        for
        such expertise.
  7
  **Critical
        Accounting Policies**
 
 Our
        financial statements were prepared in conformity with U.S. generally accepted
        accounting principles.  As such, management is required to make
        certain estimates, judgments and assumptions that they believe are reasonable
        based upon the information available.  These estimates and assumptions
        affect the reported amounts of assets and liabilities at the date of the
        financial statements and the reported amounts of income and expense during
        the
        periods presented.  The significant accounting policies which
        management believes are the most critical to aid in fully understanding and
        evaluating our reported financial results include the following:
 
 Derivatives
 
 SFAS
        133 establishes accounting and
        reporting standards for derivative instruments and requires that all derivatives
        be recorded on the balance sheet at fair value.  Additionally, the
        accounting for changes in fair value depends on whether the derivative
        instrument is designated and qualifies as part of a hedging relationship
        and, if
        so, the nature of the hedging activity.  Changes in the fair value of
        derivatives that do not qualify for hedge treatment are recognized currently
        in
        earnings.
 
 We
        have a Note from Comtex.  In August 2001, the Note was amended to
        include a provision that allows us to convert all or a portion of the
        outstanding principal amount, plus accrued interest, into common stock of
        Comtex.  In accordance with SFAS 133, we have accounted for this
        conversion option as an embedded derivative.  As a result, the
        conversion option is being carried at fair value determined using a
        Black-Scholes model with changes in the fair value being recognized currently
        in
        earnings.  As of June 30, 2006, the balance of the derivative asset
        was $419,907 and for the fiscal year ended June 30, 2006, we recognized other
        income of $315,168 due to the increase in value of this derivative.
 
 Investment
        in Comtex
 
 At
        June 30, 2006 and 2005, we had a 16% ownership interest in
        Comtex.  Since we have the ability to significantly influence the
        operations of Comtex, we account for our investment in Comtex under the equity
        method of accounting.  We can significantly influence the operations
        of Comtex since (i) if we converted our note receivable-related party into
        shares of Comtex, we would have a 21% ownership interest in Comtex, (ii)
        the
        Company as well as our Chairman and CEO are Comtex’s largest individual
        shareholders, (iii) the Company and our Chairman and CEO have a combined
        ownership interest in Comtex of 36%, and (iv) our Chairman is the Chairman
        of
        the Board and interim Chief Executive Officer of Comtex.  During the
        year ended June 30, 2006, we recognized expense of $71,934 for our share
        of
        Comtex losses and during the year ended June 30, 2005, we recognized income
        of
        $132,988 for our share of Comtex earnings.
 
 As
        of June 30, 2006, the basis of our investment in Comtex has been decreased
        to
        $-0- through the recognition of the Company’s share of Comtex’s
        losses.  As in prior periods, losses in excess of the investment basis
        adjusted the basis of the Note, in accordance with EITF 98-13, *Accounting by
        an Equity Method Investor for Investee Losses When the Investor Has Loans
        to and
        Investments in Other Securities of the Investee.*During the year
        ended June 30, 2005, equity in earnings of Comtex were sufficient to fully
        restore basis in the Note to $854,956 as well as partially restore basis
        in the
        investment of common stock. However, during the year ended June 30, 2006,
        the
        Company’s share of Comtex losses reduced the basis in the investment in common
        stock – related party to $-0- and required a reduction of $14,191 in the basis
        of the Note, resulting in a carrying value of $672,336, net of a discount
        of
        $170,427.
  8
  Note
        Receivable from Comtex
 
 Statement
        of Financial Accounting Standards No. 114, *Accounting by Creditors for
        Impairment of a Loan* (“SFAS 114”), suggests that when certain indicators
        are present, a loan should be evaluated for collectibility.  Since
        Comtex experienced prior year losses, we evaluated the Note for
        collectibility.  As a result, we evaluated whether or not there is an
        impairment loss by comparing the fair value of the collateral (including
        cash
        and security interest in the accounts receivable of Comtex) to the carrying
        value of the Note of $672,336.  We believe that since the fair value
        of our collateral exceeded the carrying value of the Note, we should not
        record
        an impairment charge at June 30, 2006.
 
 Valuation
        of Deferred Tax Assets
 
 We
        recognize deferred tax assets and liabilities based on the difference between
        the financial statement and tax bases of assets and liabilities.  We
        regularly review our deferred tax assets for recoverability and establish
        a
        valuation allowance based on historical taxable income, projected future
        taxable
        income and the expected timing of the reversals of existing temporary
        differences.  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,
        we
        have established a full valuation allowance against the deferred tax
        assets.
 
 Results
        of Operations
 
 *Comparison
        of the fiscal year ended June 30, 2006 to the fiscal year ended June 30,
        2005*
 
 The
        Company had net income of $281,531 in fiscal year 2006 compared to net income
        of
        $175,366 in fiscal year 2005.  The increase is explained
        below.
 
 *Operating
        costs and expenses*.  Operating costs and expenses increased
        $29,048 to $209,886 in fiscal year 2006 primarily due to a increase in legal
        fees as the Company responded to SEC findings during it’s triennial review and
        the Company explored the feasibility of selling the company.  General
        and administrative fees increased in support of those efforts.
 
 *Other
        income (expense)*:  Other income (expense) increased $135,213 from
        other income of $356,204 in fiscal year 2005 to other income of $491,417
        in
        fiscal year 2006 primarily due to an increase of $338,972 in the value of
        the
        derivative asset, which was due to fluctuations in the option price calculated
        using a Black-Scholes option pricing model.  During fiscal year 2006,
        the Company’s share of the equity in earnings of Comtex decreased $204,922,
        which was due to the continuing operating losses of Comtex.
 
 9
 Liquidity
        and Capital Resources
 
 The
        Company had net working capital of $52,027 at June 30, 2006.  The
        Company has had minimal operating activity since commencing operations in
        1996
        and has not had any other uses of funds.  Accordingly, the Company has
        not required any funding sources.  The Company expects to meet its
        short-term obligations through payments of interest from the Note and from
        the
        sales of equity interests in Analex.
 
 Cautionary
        Statements Concerning Forward-Looking Statements
 
 Except
        for the historical information contained herein, the matters discussed in
        this
        Form 10-KSB include forward-looking statements within the meaning of Section
        21E
        of the Securities and Exchange Act of 1934.  These forward-looking
        statements may be identified by reference to a future period or by use of
        forward-looking terminology such as “anticipate”, “expect”, “could”, “may” or
        other words of a similar nature.  Forward-looking statements, which
        the Company believes to be reasonable and are made in good faith, are subject
        to
        certain risks and uncertainties that could cause actual results to differ
        materially from those expressed in any forward-looking statement made by,
        or on
        behalf of, the Company.
 
 **Item
        7.                                Financial
        Statements**
 
 The
        information required by this item is set forth under Item 13, which is
        incorporated herein by reference.
 
 **Item
        8.** **Changes
        in and Disagreements with Accountants on Accounting and Financial
        Disclosure**
 
 None.
 
 **Item
        8A.                             Controls
        and Procedures**
 
 Under
        the supervision and with the participation of our Chief Executive Officer
        and
        Chief Financial Officer, we evaluated the effectiveness of the design and
        operation of our disclosure controls and procedures (as defined in Rule 13a-15
        (e) and 15d-15(e) under the Exchange Act) as of the end of the period covered
        by
        this annual report.  Based upon that evaluation, the Chief Executive
        Officer and Chief Financial Officer concluded that, as of the end of the
        period
        covered by this annual report, our disclosure controls and procedures were
        effective to ensure that information required to be disclosed in the reports
        that the Company files or submits under the Exchange Act is recorded, processed,
        summarized and reported within the time periods specified in the Securities
        and
        Exchange Commission’s rules and forms.
 
 **Item
        8B.                            
Other Information**
 
 None.
  10
 **PART
        III**
 
 **Item
        9.** **Directors
        and Executive Officers of the Registrant; Compliance with Section 16(a) of
        the
        Exchange Act.**
 
 **Directors**
 
 The
        following table contains information as of June 30, 2006 as to each Director
        of
        the Company:
  Director
                
                Office
                    HeldName
                
                Since
                
                Age
                
                with
                    the CompanyC.W.
                    Gilluly, Ed.D.
                
                1992
                
                60
                
                Chairman
                    of the Board, President
                  and
                      Chief Executive OfficerRobert
                    F. Delaney (1,2)
                
                1992
                
                81
                
                DirectorRobert
                    J. Lynch, Jr. (1,2)
                
                1992
                
                73
                
                DirectorThomas
                    E. McMahan (1,2)
                
                1992
                
                63
                
                Director
 
 (1)
              Member
                  of the Audit Committee.  The Audit Committee met four times
                  during the fiscal year ended June 30,
                  2006.
 (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
        interim Chief Executive Officer 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
        F. DELANEY has been
        Facilitator of Long Range Study at the U.S. Naval War College and a management
        consultant specializing in the area of organizational
        development.  From 1981 through 1991, Mr. Delaney served as president
        of the RFD Group and Michael W. Moynihan Associates, Management and Public
        Affairs Consultants.  In 1990, Mr. Delaney was an Intelligence
        Briefing Officer for Operation Desert Storm at the Naval Medical Corps, Fort
        Dix, New Jersey.  Since 1972, Mr. Delaney has been a lecturer at the
        NATO Defense College, Armed Forces Staff College, Defense Information School,
        Marine Corp Schools and the U.S. Naval War College.
 
 11
 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-six 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 though 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, 2006, 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 (52) 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.
 
 **Section
        16(A) Beneficial Ownership Reporting Compliance**
 
 Section
        16(a) of the Exchange Act
        requires the Company’s executive officers and Directors, and persons who own
        more than 10% of a registered class of the Company’s equity securities, to file
        reports of ownership and changes in ownership with the SEC.  Executive
        officers, Directors and greater than 10% stockholders are required by the
        SEC
        regulation to furnish the Company with copies of all Section 16(a) forms
        they
        file.
 
 Based
        solely on a review of copies
        of such reports of ownership furnished to the Company, or written
        representations that no forms were necessary, the Company believes that during
        the past fiscal year, its executive officers, Directors and greater than
        10%
        beneficial owners complied with all applicable filing requirements.
 
 **Code
        of Ethics**
 
 The
        Company has not adopted a code
        of ethics given its limited operations.
  12
 **Item
        10.                            
Executive Compensation**
 
 **Summary
        Compensation Table**
 
 The
        following table sets forth information concerning all compensation paid or
        accrued by the Company to its President and Chief Executive Officer, during
        the
        fiscal year ended June 30, 2006.  Neither Dr. Gilluly nor any other
        officer of the Company receives compensation in excess of $100,000 per
        year.
   Annual
                    Compensation
                
                Long-Term
                  Compensation
                    AwardsName
                    and
                  Principal
                    Position
                
                Fiscal
                  Year
                
                Salary
                
                Bonus
                
                Stock
                    Options
                  Granted
                
                All
                    Other
                  CompensationC.W.
                    Gilluly (1)
                
                2006
                
                $36,000
                
                —
                
                —
                
                $6,805Chairman
                
                2005
                
                $36,000
                
                —
                
                —
                
                $6,8052004
                
                $15,000
                
                —
                
                —
                
                $6,805
 
 (1)
              Dr.
                  Gilluly did not receive any salary from 1992 through fiscal
                  2003.  In 1996, he received a grant of stock options, described
                  below.
 
 **Stock
        Option Grants**
 
 No
        stock options were granted during the fiscal year ended June 30,
        2006.  In accordance with the Company’s Stock Option Plan, Dr. Gilluly
        received a grant of 350,000 options in November 1996, at an exercise price
        of
        $0.01 per share.  He has not received any further grants.
 
 **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,
        2006.
  **Fiscal
          Year-End Option Values (1)**
 Shares
                  Acquired
                    upon
                  Exercise
                    of
                
                Value
                    Realized
                  From
                    Exercise
                
                Number
                    of Shares
                  Underlying
                    Unexercised
                  Options
                    at June 30, 2006
                
                Value
                    of Unexercised
                  In-the-Money
                    Options
                  at
                    June 30, 2006Name
                
                Options
                
                Of
                    Options
                
                Exercisable
                
                Unexercisable
                
                Exercisable
                
                UnexercisableC.W.
                    Gilluly
                
                —
                
                —
                
                350,000
                
                —
                
                $—
                
                —
  (1)
              As
                  there has been no trading in the Company’s stock since its formation, the
                  Company determined that the market value of its common stock approximates
                  its exercise price of $.01, based on an assumed liquidation value
                  of the
                  Company’s investments in Comtex and Analex; however, there can be no
                  assurance that this is an accurate reflection of the market
                  value.
  13
 **Stock
        Option Plan**
 
 The
        Company’s Stock Option Plan was
        approved pursuant to the Confirmation of the Third Amended Plan of
        Reorganization of Infotech on June 21, 1994 and was effective as of the
        Effective Date of the Plan, on June 21, 1996.  The Plan provides for
        the issuance of incentive stock options within the meaning of Section 422
        of the
        Internal Revenue Code of 1986, as amended, and non-qualified stock options
        in
        order to recruit and retain key employees, consultants and
        Directors.
 
 **Compensation
        of Directors**
 
 The
        Company pays non-employee members
        of the Board $1,000 per quarter, $500 per board meeting, and $250 per audit
        committee meeting, plus travel expenses incurred in connection with attendance
        at Board meetings.  During fiscal year 2006, each of the Company’s
        non-employee Directors received compensation of $6,500 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
                  F. Delaney
              $6,500
              --
              --
              ---
              ---
              ---
              $6,500Robert
                  J. Lynch, Jr.
              $6,500
              --
              --
              ---
              ---
              ---
              $6,500Thomas
                  E. McMahan
              $6,500
              --
              --
              ---
              ---
              ---
              $6,500
 
 
 
 
 **Employment
        Agreements**
 
 The
        Company has no employment
        agreements.
  14
 **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, 2006, Dr. Gilluly
        received payment of $36,000 as compensation for his services as President
        and
        Chief Executive Officer of the Company.
 
 **Submitted
        by the Compensation
        Committee**
 
 Robert
        F.
        Delaney
 Robert
        J. Lynch, Jr.
 Thomas
        E. McMahan
 
 **Compensation
        Committee Interlocks and Insider Participation**
  None
 
 **Item
        11.** **Security
        Ownership of Certain Beneficial Owners and Management and Related Stockholder
        Matters**
 
 The
        following table sets forth information as of June 30, 2006, 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”) and (iv) all executive
        officers and Directors of the Company as a group.  Unless otherwise
        indicated, the address of each named beneficial owner is c/o AMASYS Corp.,
        625
        North Washington Street, Suite 301, Alexandria, Virginia
        22314.  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)Irapil
                    Corporation
                  115
                    East 57th
                    Street
                  11th
                    Floor, Box
                    141
                  New
                    York, NY 10022
                
                1,960,000
                    (2)
                
                47.0%C.W.
                    Gilluly, Chairman and CEO
                
                427,048
                    (3)
                
                16.7Robert
                    F. Delaney, Director
                
                50,000
                    (4)
                
                2.2Robert
                    J. Lynch, Jr., Director
                
                56,245
                    (4)(5)
                
                2.5Thomas
                    E. McMahan, Director
                
                77,043
                    (4)
                
                3.4
  15
  Joshua
                    Angel
                  c/o
                    Herrick, Feinstein LLP
                  2
                    Park Avenue
                  New
                    York, NY 10016
                
                191,578
                
                8.7Bruce
                    Frankel Estate
                  c/o
                    Cole, Schotz PA
                  900
                    Third Ave, 16th
                    Floor
                  New
                    York, NY 10022
                
                128,901
                
                5.8S.
                    Amber Gordon
                
                300,655
                    (6)
                
                12.0All
                    Directors and Executive Officers as a group (5 persons)
                
                910,991
                    (7)
                
                30.3
 (1)
              Each
                  percentage of beneficial ownership is calculated using a different
                  denominator, consisting of the total number of shares outstanding
                  (2,207,350), increased by the number of options owned by the beneficial
                  owner 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 options held by Directors and executive officers that
                  are
                  exercisable within 60 days.
 (2)
              Based
                  solely on a Schedule 13D filed with the Securities and Exchange
                  Commission
                  on August 7, 2006 by Irapil Corporation.  Includes 1,960,000
                  shares which may be acquired upon the conversion of AMASYS Preferred
                  Shares held by Irapil Corporation.
 (3)
              Includes
                  350,000 shares which may be acquired upon the exercise of vested
                  options
                  granted under the AMASYS Corporation Stock Option
                  Plan.
 (4)
              Includes
                  50,000 shares which may be acquired upon the exercise of vested
                  options
                  granted under the AMASYS Corporation Stock Option
                  Plan.
 (5)
              Includes
                  245 shares held by Mr. Lynch’s
                  wife.
 (6)
              Includes
                  300,000 shares which may be acquired upon the exercise of vested
                  options
                  granted under the AMASYS Corporation Stock Option
                  Plan.
 (7)
              Includes
                  800,000 shares which may be acquired upon the exercise of vested
                  options
                  granted under the AMASYS Corporation Stock Option
                  Plan.
 
 **Item
        12.                             Certain
        Relationships and Related Transactions**
 
 Dr.
        Gilluly serves as Chairman of the Board and Chief Executive Officer of the
        Company.  Dr. Gilluly also serves as a Director and as Chief Executive
        Officer of Comtex.  Mr. Lynch, a Director of the Company, also serves
        as a Director of Comtex.
 
 16
 **PART
        IV**
 
 **Item
        13.** **Exhibits
        and Reports on Form 8-K**
  **(a)**1.
              **Financial
                  Statements**Report
                  of Independent Registered Public Accounting
                Firm
                  (Turner, Stone & Company, L.L.P)
              F-1Report
                  of Independent Registered Public Accounting
                Firm
                  for Comtex News Network, Inc.
                ****(Goldstein
                  Golub Kessler LLP
              F-2Balance
                  Sheet at June 30, 2006
              F-3Statements
                  of Operations for the fiscal
                years
                  ended June 30, 2006 and 2005
              F-4Statements
                  of Stockholders’ Equity
                for
                  the fiscal years ended June 30, 2006 and 2005
              F-5Statements
                  of Cash Flows for the fiscal
                years
                  ended June 30, 2006 and 2005
              F-6Notes
                  to Financial Statements
              F-7**2.**
              **Financial
                  Statement Schedules**The
                  schedules for which provision is made in the applicable accounting
                  regulation of the Securities and Exchange Commission are not required
                  under the related instructions or are inapplicable and therefore
                  have been
                  omitted.**3.**
              **Exhibits**Number
              
              Description1.1
              
              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).
  17
  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 Stock Option Plan (incorporated by reference to the
                  Company’s
                  Form 10-K, for the year ended June 30, 2000, filed on July 2,
                  2001).10.2
              
              Second
                  Amendment to Amended, Consolidated and Restated 10% Senior Subordinated
                  Secured Note between the Company and Comtex News Network, Inc.
                  (incorporated by reference to the Company’s Form 10-K, for the year ended
                  June 30, 2001, filed on September 28, 2001).10.3
              
              Payment
                  and Release Agreement between the Company and the Pension benefit
                  Guaranty
                  Corporation dated February 1, 2002. (incorporated by reference
                  to the
                  Company’s Form 10-Q, for the quarter ended December 31, 2001, filed on
                  February 13, 2002).10.4
              
              Note
                  between the Company and C.W. Gilluly dated December 21, 2001.
                  (incorporated by reference to the Company’s Form 10-Q, for the quarter
                  ended December 31, 2001, filed on February 13, 2002).10.5
              
              Note
                  between the Company and C.W. Gilluly dated February 12, 2002.
                  (incorporated by reference to the Company’s Form 8-K filed on February 20,
                  2002).31.1
              
              Certification
                  pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
              
              Certification
                  pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
              
              Certification
                  pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
              
              Certification
                  pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.99.1
              
              Agreement
                  and Plan of Share Exchange by and among AMASYS Corporation, World
                  Mineral
                  corporation and the shareholders of World Mineral Corporation,
                  dated
                  September 26, 2006 (incorporated by reference to the Company’s Form 8-K
                  filed on September 27, 2006).99.2
              
              Redemption
                  and Conversion Agreement between AMASYS Corporation and Tepco Ltd.,
                  dated
                  September 25, 2006 (incorporated by reference to the Company’s Form 8-K
                  filed on September 27, 2006).99.3
              
              Redemption
                  and Conversion Agreement between AMASYS Corporation and Andrew
                  S.
                  Zamfotis, dated September 25, 2006 (incorporated by reference to
                  the
                  Company’s Form 8-K filed on September 27, 2006).99.4
              
              Note
                  between AMASYS Corporation and Private Capital Group, Inc., dated
                  May 24,
                  2007 (incorporated by reference to the Company’s Form 8-K filed on May 24,
                  2007).99.5
              
              Note
                  between AMASYS Corporation and C.W. Gilluly, dated May 24, 2007
                  (incorporated by reference to the Company’s Form 8-K filed on May 24,
                  2007).99.6
              
              AMASYS
                  Corporation Warrant issued to Private Capital Group, Inc. and C.W.
                  Gilluly
                  (incorporated by reference to the Company’s Form 8-K filed on May 24,
                  2007).




18
 **(b) Reports on Form 8-K**
 
 No
        reports on Form 8-K were filed by the Company during the last quarter of
        the
        period covered by this Report.
 
 **Item
        14.                           
Principal Accountant Fees and Services**
 
 Our
        Audit Committee is responsible for appointment of the Company’s independent
        registered public accounting firm.  During the year ended June 30,
        2006, the Company engaged Turner, Stone & Company, LLP and ceased using
        Kaiser Scherer & Schlegel, PLLC to conduct its annual audit and quarterly
        reviews of the financial statements and to provide services in connection
        with
        the SEC proxy statement filing.
 
 The
        following table sets forth aggregate fees billed to the Company by its principal
        accountants for the fiscal years ended June 30, 2006 and 2005.
 
 **Fiscal
                    Years Ended June 30,****2006**
              
              
              **2005**Audit
                  Fees
              
              $
              32,374
              
              
              $
              33,750Audit-Related
                  Fees
              
              
              —
              
              
              
              —Tax
                  Fees
              
              
              —
              
              
              
              —All
                  Other
                  Fees
              
              
              —
              
              
              
              —
 
 Fees
        for audit services include fees associated with the annual audit and the
        reviews
        of the Company’s quarterly reports on Form 10-QSB.
 
 The
        Audit Committee’s policy is to
        pre-approve all audit and non-audit services provided by the independent
        registered public accounting firm, either by approving an engagement prior
        to
        the engagement or pursuant to a pre-approval policy with respect to particular
        services.  These services may include audit services, review services,
        and other services.  The independent registered public accounting firm
        and management are required to periodically report to the full Audit Committee
        regarding the extent of services provided by the independent registered public
        accounting firm in accordance with the pre-approval, and the fees for the
        services performed to date.
 
 19
 SIGNATURES
 
 
 Pursuant
        to the requirements of Section
        13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly
        caused this report to be signed on its behalf by the undersigned, there unto
        duly authorized.
 
 Date:  October
        2, 2007
 
 
 AMASYS
        CORPORATION
 
 
 By:       /s/
        C.W.
        Gilluly
 C.W.
        Gilluly, Ed.D.
 President
        and Chief Executive
        Officer
 (Principal
        Executive Officer
        and
 Principal
        Financial and
        Accounting 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
                
                October
                    2, 2007C.W.
                    Gilluly, Ed.D.
                
                and Director/s/
                    Robert F. Delaney
                
                Director
                
                October
                    2, 2007Robert
                    F. Delaney/s/
                    Robert J. Lynch, Jr.
                
                Director
                
                October
                    2, 2007Robert
                    J. Lynch, Jr./s/
                    Thomas E. McMahan
                
                Director
                
                October
                    2, 2007Thomas
                    E. McMahan
  20
 
 **Report
        of Independent Registered Public Accounting Firm**
 
 
 To
        the Board of Directors and Shareholders of
 AMASYS
        Corporation
 
 We
        have audited the accompanying balance sheet of AMASYS Corporation (the
“Company”) as of June 30, 2006, and the related statements of operations,
        stockholders’ equity and cash flows for the year then ended. 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 audit.
 
 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.  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,
        2006, and the results of its operations and its cash flows for the year then
        ended in conformity with accounting principles generally accepted in the
        United
        States of America.
 
 
 /s/
        Turner, Stone & Company, L.L.P.
 
 Certified
        Public Accountants
 Dallas,
        Texas
 October
        2, 2007
 
 F-1
 **REPORT
        OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**
 
   The
        Board of Directors and Stockholders
 Comtex
        News Network, Inc.
   We
        have audited the accompanying consolidated balance sheets of Comtex News
        Network, Inc. as of June 30, 2006 and 2005, and the related consolidated
        statements of operations, stockholders' equity (deficiency) and cash flows
        for
        each of the three years in the period ended June 30, 2006.  These
        financial statements are the responsibility of the Company's
        management.  Our responsibility is to express an opinion on these
        financial statements based on our audits.
 
 We
        conducted our audits in accordance with 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.  An audit
        includes examining, on a test basis, evidence supporting the amounts and
        disclosures in the financial statements.  An audit also includes
        assessing the accounting principles used and significant estimates made by
        management, as well as evaluating the overall financial statement
        presentation.  We believe that our audits provide a reasonable basis
        for our opinion.
 
 In
        our opinion, the financial statements referred to above present fairly, in
        all
        material respects, the financial position of Comtex News Network, Inc. as
        of
        June 30, 2006 and 2005, and the results of its operations and its cash flows
        for
        each of the three years in the period ended June 30, 2006, in conformity
        with
        United States generally accepted accounting principles.
 
 As
        discussed in Note 2 to the consolidated financial statements, the Company
        adopted the provisions of the Financial Accounting Standard Board’s Statement of
        Financial Accounting Standard No. 123R, “*Share-Based Payment*,” and
        changed its method for accounting for share-based payments as of July 1,
        2005.
 
 
  **GOLDSTEIN
        GOLUB KESSLER LLP**
 New
        York, New York
 
 August
        25, 2006
 Except
        for the last paragraph of Note 1 as to which the date is September 26,
        2006
 
 F-2
 
 AMASYS
        Corporation
 
 Balance
        Sheet
 
 **June
                  30,**
                **2006****Assets**Current
                  assets:Cash
                  and cash equivalents
              
              $
              11,620Short-term
                  investment
              
              
              74,400Total
                  current assets
              
              
              86,020Note
                  receivable – related party, net of discount of $170,427 at June 30,
                  2006
              
              
              672,336Derivative
                  asset
              
              
              419,907Total
                  assets
              
              $
              1,178,263
 **Liabilities
                  and Stockholders’ equity**Current
                  liabilities:Accounts
                  payable and accrued expenses
              
              $
              33,993Total
                  current liabilities
              
              
              33,993Stockholders’
                  equity:Preferred
                  stock, $.01 par value; 1,000,000 shares authorized; 196,000 Series
                  A
                  shares issued and outstanding; liquidation value
                  $1,960,000
              
              
              1,960Common
                  stock, $0.01 par value; 20,000,000 shares authorized; 2,207,350
                  shares
                  issued and outstanding
              
              
              22,073Additional
                  paid-in capital
              
              
              799,485Accumulated
                  other comprehensive income
              
              
              37,773Retained
                  earnings
              
              
              282,979Total
                  stockholders’ equity
              
              
              1,144,270Total
                  liabilities and stockholders’ equity
              
              $
              1,178,263
 
 *See
        accompanying notes.*
  F-3
 AMASYS
        Corporation
  Statements
        of Operations
 
 **Year
                  Ended June 30,****2006**
              
              
              **2005**Operating
                  costs and expenses:Professional
                  services
              
              $
              187,851
              
              
              $
              161,085General
                  and administrative
              
              
              22,035
              
              
              
              19,753Total
                  operating costs and expenses
              
              
              209,886
              
              
              
              180,838Other
                  income (expense):Interest
                  income
              
              
              177,955
              
              
              
              177,955Equity
                  in (losses) earnings of Comtex
              
              
              (71,934
              )
              
              
              132,988Gain
                  (loss) on derivative asset
              
              
              315,168
              
              
              
              (23,804
              )Gain
                  on sale of short-term investment
              
              
              70,228
              
              
              
              69,065Other
                  income
              
              
              —
              
              
              
              —Total
                  other income
              
              
              491,417
              
              
              
              356,204Income
                  before income taxes
              
              
              281,531
              
              
              
              175,366Provision
                  for income taxes
              
              
              —
              
              
              
              —Net
                  income
              
              $
              281,531
              
              
              $
              175,366Income
                  per share:Basic
              
              $
              0.08
              
              
              $
              0.04Diluted
              
              $
              0.07
              
              
              $
              0.04Weighted
                  average number of shares:Basic
              
              
              2,207,350
              
              
              
              2,207,350Diluted
              
              
              4,167,350
              
              
              
              4,167,350
 
 *See
        accompanying notes.*
 
 F-4
 AMASYS
        Corporation
  Statements
        of Stockholders’ Equity
 Years
        Ended June 30, 2006 and 2005
 
 
 **Accumulated**
              
              
              **(Accumulated****Additional**
              
              
              **Other**
              
              
              **Deficit)**
              
              
              **Total****Common
                  Stock**
              
              
              **Preferred
                  Stock**
              
              
              **Paid-In**
              
              
              **Comprehensive**
              
              
              **Retained**
              
              
              **Stockholders’****Shares**
              
              
              **Amount**
              
              
              **Shares**
              
              
              **Amount**
              
              
              **Capital**
              
              
              **Income**
              
              
              **Earnings**
              
              
              **Equity**Balance,
                  June 30, 2004
              
              
              2,207,350
              
              
              $
              22,073
              
              
              
              196,000
              
              
              $
              1,960
              
              
              $
              799,443
              
              
              $
              235,812
              
              
              $
              (173,918
              )
              
              $
              885,370Increase
                  in equity due to capital transactions of Comtex
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              42
              
              
              
              
              
              
              
              
              
              
              
              42Unrealized
                  loss on short-term investment
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (57,338
              )
              
              
              
              
              
              
              (57,338
              )Net
                  loss
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              175,366
              
              
              
              175,366Comprehensive
                  income
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              118,028Balance,
                  June 30, 2005
              
              
              2,207,350
              
              
              
              22,073
              
              
              
              196,000
              
              
              
              1,960
              
              
              
              799,485
              
              
              
              178,474
              
              
              
              1,448
              
              
              
              1,003,440Unrealized
                  loss on short-term investment
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (140,701
              )
              
              
              
              
              
              
              (140,701
              )Net
                  income
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              281,531
              
              
              
              281,531Comprehensive
                  income
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              140,830Balance,
                  June 30, 2006
              
              
              2,207,350
              
              
              $
              22,073
              
              
              
              196,000
              
              
              $
              1,960
              
              
              $
              799,485
              
              
              $
              37,773
              
              
              $
              282,979
              
              
              $
              1,144,270
 
 *See
        accompanying notes.*
  F-5
 AMASYS
        Corporation
  Statements
        of Cash Flows
 
 
 **Year
                  ended June 30,****2006**
              
              
              **2005**Operating
                  activitiesNet
                  income
              
              $
              281,531
              
              
              $
              175,366Adjustments
                  to reconcile net income
                to
                  net cash used in operating activities:Amortization
                  on note receivable discount
              
              
              (92,260
              )
              
              
              (92,260
              )(Gain)
                  loss on derivative asset
              
              
              (315,168
              )
              
              
              23,804Gain
                  on sale of short-term investment
              
              
              (70,228
              )
              
              
              (69,065
              )Equity
                  in losses  (earnings) of Comtex
              
              
              71,934
              
              
              
              (132,988
              )Changes
                  in operating assets and liabilities:Accounts
                  payable and accrued expenses
              
              
              30,312
              
              
              
              (4,793
              )Net
                  cash used in operating activities
              
              
              (93,879
              )
              
              
              (99,936
              )Investing
                  activitiesProceeds
                  from sale of short-term investment
              
              
              104,475
              
              
              
              90,953Net
                  cash provided by investing activities
              
              
              104,475
              
              
              
              90,953Net
                  increase (decrease) in cash
              
              
              10,596
              
              
              
              (8,983
              )Cash
                  at beginning of year
              
              
              1,024
              
              
              
              10,007Cash
                  at end of year
              
              $
              11,620
              
              
              $
              1,024
 
 *See
        accompanying notes.*
  F-6
 AMASYS
              Corporation
 
 Notes
              to Financial Statements
 June
        30, 2006
   
 **1.  Organization
        and Basis of Presentation**
 
 AMASYS
        Corporation (the “Company”) 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 11, 1996 and effective as of June 21, 1996.  The Company’s
        principal business is the maintenance of its equity interests in and note
        receivable from Comtex News Network, Inc. (“Comtex”) and its equity interest in
        Analex Corporation (“Analex”).
 
 **2.  Summary
        of Significant Accounting Policies**
 
 Cash
        and Cash Equivalents
 
 The
        Company considers all short-term securities purchased with a maturity of
        three
        months or less to be cash equivalents.
 
 Use
        of Estimates
 
 The
        preparation of financial statements in conformity with accounting principles
        generally accepted in the United States requires management to make estimates
        and assumptions that affect the reported amounts of 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.
 
 Concentrations
        of Credit Risk
 
 The
        Company’s financial instruments that are subject to credit risk consist
        primarily of cash, note receivable-related party, short-term investment and
        investment in common stock – related party. Cash is maintained with a financial
        institution, which has high credit standing.  The note receivable
–related party is secured by a continuing interest in all receivables, purchase
        orders and all patents and technology now or hereafter held or received by
        Comtex and is subordinated to Comtex’s bank financing agreement.  The
        note is one of two primary sources of cash for funding continuing operations
        of
        the Company in the form of periodic interest payments.  The other
        primary source is from sales of the short-term investment.  Thus, the
        Company is dependent upon Comtex to continue making interest payments until
        maturity and upon the market value of the investment in Analex to meet its
        short-term obligations.
 
 The
        Company considers the fair value of the collateral on the note when assessing
        credit risk.  Management periodically evaluates the carrying value of
        its short-term investment and investment in common stock – related party for
        impairment and recognizes an impairment charge when a decline in the market
        value of its investments below the basis is judged to be
        other-than-temporary.  At June 30, 2006, the Company does not consider
        any of the investments impaired.
 
 F-7
 
  AMASYS
            Corporation
 
 Notes
            to Financial Statements
 Derivative
        Instruments
 
 SFAS
        133 establishes accounting and reporting standards for derivative instruments
        and requires that all derivatives be recorded on the balance sheet at fair
        value.  Additionally, the accounting for changes in fair value depends
        on whether the derivative instrument is designated and qualifies as part
        of a
        hedging relationship and, if so, the nature of the hedging
        activity.  Changes in the fair value of derivatives that do not
        qualify for hedge treatment are recognized currently in earnings.
 
 As
        discussed in Note 4, the Company has a note receivable–related party from
        Comtex.  In August 2001, the parties amended the note receivable –
related party to include a provision that allows the Company to convert all
        or a
        portion of the outstanding principal amount, plus accrued interest, into
        common
        stock of Comtex.  In accordance with SFAS 133, the Company has
        accounted for this conversion option as an embedded derivative.  As a
        result, the conversion option is carried at fair value determined using a
        Black-Scholes model with changes in the fair value recognized currently in
        earnings.  For the past eleven years, the Company has engaged the
        services of a CPA firm to prepare the derivative asset valuation.  The
        procedures utilized to compute the derivative asset evaluation using the
        Black-Scholes model were originally established by a major, international
        accounting firm.  These procedures have been consistently followed
        since inception.  As of June 30, 2006 the balance of the derivative
        asset was $419,907 and for the fiscal years ended June 30, 2006 and 2005,
        the
        Company recognized other income (expense) of $315,168 and $(23,804),
        respectively, due to the increase (decline) in value of this
        derivative.
 
 F-8
 
  AMASYS
            Corporation
 
 Notes
            to Financial Statements
  The
            fair value of the derivative instrument is estimated quarterly using
            the
            following assumptions:
 Quarter
                  Ended (UNAUDITED)September
                  30, 2005
              December
                  31, 2005
              March
                  31, 2006
              June
                  30, 2006Risk
                  free rate of interest
              4%
              4%
              4%
              4%Expected
                  dividend rate
              0%
              0%
              0%
              0%Expected
                  life in years
              2.75
              2.5
              2.25
              2.0Per
                  share market price of Comtex stock
              $0.63
              $0.41
              $0.19
              $0.85Conversion
                  factor
              $0.90
              $0.95
              $0.95
              $1.00Number
                  of shares under option
              952,171
              902,057
              902,057
              856,954Volatility
                  rate
              107.00%
              102.00%
              111.00%
              117.00%Derivative
                  asset value
              $342,782
              $162,370
              $45,103
              $419,907
  Quarter
                  Ended (UNAUDITED)September
                  30, 2004
              December
                  31, 2004
              March
                  31, 2005
              June
                  30, 2005Risk
                  free rate of interest
              4%
              4%
              4%
              4%Expected
                  dividend rate
              0%
              0%
              0%
              0%Expected
                  life in years
              3.75
              3.5
              3.25
              3.0Per
                  share market price of Comtex stock
              $0.12
              $0.22
              $0.18
              $0.14Conversion
                  factor
              $0.80
              $0.85
              $0.85
              $0.90Number
                  of shares under option
              1,071,193
              1,008,181
              1,008,181
              952,171Volatility
                  rate
              103.00%
              76.00%
              100.00%
              182.00%Derivative
                  asset value
              $42,848
              $50,409
              $60,491
              $104,739
  F-9
 
  AMASYS
            Corporation
 
 Notes
            to Financial Statements
 As
        indicated in the above table, the primary fluctuations in the fair value
        of the
        derivative instrument are the volatility rate, the per share market price
        of
        Comtex stock, the conversion factor and the number of shares under
        option.
 
 Short-Term
        Investment
 
 Under
        Statement of Financial Accounting Standard No. 115, *Accounting for Certain
        Investments in Debt and Equity Securities*, the Company has classified its
        investment in Analex as an “available-for-sale” security.  As a
        result, the investment is carried at fair value, with unrealized gains and
        losses, net of tax, reported as a separate component of stockholders’
equity.  Realized gains and losses on sales of securities are included
        in earnings using the specific identification method.
 
 During
        the fiscal years ended June 30, 2006 and 2005, the Company reclassified
        unrealized gains to realized gains of $70,228 and $69,065, respectively,
        on the
        available-for-sale security included as a separate component of stockholders’
equity due to the sale of securities.
 
 Investment
        in Common Stock – Related Party
 
 At
        June 30, 2006 and 2005, the Company had a 16% ownership interest in
        Comtex.  The Company evaluated the applicability of the provisions of
        FASB Interpretation No. 46, *Consolidation of Variable Interest Entities (FIN
        46),*to its equity investment in Comtex.  Specifically, the
        Company has determined that Comtex is not a variable interest entity because
        the
        requirements of paragraphs 4(h) and 5 of FIN 46 are not met:
 1.
              AMASYS
                  did not participate in the design or redesign of
                  Comtex
 2.
              Comtex’s
                  activities neither involve nor are conducted on behalf of
                  AMASYS
 3.
              AMASYS’
                  equity and subordinated debt are less than half of the total of
                  Comtex’s
                  equity, subordinated debt and other subordinated financial support,
                  based
                  on the fair values of the interests in
                  Comtex
 4.
              Comtex’s
                  activities are not primarily related to securitizations or other
                  forms of
                  asset-backed financing or single-lessee leasing
                  arrangements
 
 The
        Company does have the ability to significantly influence the operations of
        Comtex, and the Company accounts for its investment in Comtex under the equity
        method of accounting.  The Company can significantly influence the
        operations of Comtex since (i) if the Company converted its note
        receivable-related party into shares of Comtex, the Company would have a
        21%
        ownership interest in Comtex, (ii) the Company as well as the Company’s Chairman
        and CEO are Comtex’s largest individual shareholders, (iii) the Company and the
        Company’s Chairman and CEO have a combined ownership interest in Comtex of 36%
        and (iv) the Company’s Chairman and Chief Executive Officer is concurrently
        serving as Chairman and interim Chief Executive Officer of
        Comtex.  During the year ended June 30, 2006, the Company recognized
        expense of $71,934 for our share of Comtex losses and for the year ended
        June
        30, 2005, we recognized income of $132,988 for the Company’s share of Comtex
        earnings.
 
 F-10
 
  AMASYS
            Corporation
 
 Notes
            to Financial Statements
 At
        June 30, 2006 and 2005, the Company’s equity share of Comtex losses had exceeded
        the Company’s basis in the investment in common stock – related party accounted
        for under equity method accounting.  Additional losses in excess of
        basis were accounted for as an adjustment to the basis of other investments
        in
        the investee (note receivable from Comtex) held by the Company in accordance
        with EITF 98-13 “Accounting by an Equity Method Investor for Investee Losses
        When the Investor Has Loans to and Investments in Other Securities of the
        Investee.”  Subsequent investee income has been recorded as
        adjustments to the adjusted basis of the other investments in the reverse
        order
        of the application of the investor’s share of the investee’s
        losses.  As of June 30, 2006, equity in Comtex losses has caused a
        reduction in the  basis to the Note of $14,191 to $842,763 and reduced
        the basis in the investment in common stock–related party to $-0-.
 
 Income
        Taxes
 
 The
        Company accounts for income taxes in accordance with SFAS 109, *Accounting
        for 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 the Company 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
 
 SFAS
        No. 123 (“SFAS 123”), *Accounting for Stock-Based Compensation*, requires
        that companies either recognize compensation expense for grants of stock
        options
        and other equity instruments based on fair value, or provide pro forma
        disclosure of net income (loss) and net income (loss) per share in the notes
        to
        the financial statements.  At June 30, 2006, the Company had a
        stock-based compensation plan, which is described more fully in Note
        8.  The Company accounts for this plan under the recognition and
        measurement principles of Accounting Principles Board Opinion No. 25 (“APB 25”),
*Accounting for Stock Issued to Employees*, and related
        interpretations.  Accordingly, no compensation cost has been
        recognized under SFAS 123 for the Company’s employee stock option
        plan.  Due to the fact that options granted in 1996 were immediately
        exercisable, net income (loss) and earnings (loss) per share is the same
        under
        SFAS 123 and APB 25 for the fiscal years ended June 30, 2006 and
        2005.
 
 SFAS
        No. 148 (“SFAS 148”), *Accounting for Stock-Based Compensation-Transition and
        Disclosure*, amends SFAS 123. SFAS 148 provides alternative methods of
        transition for a voluntary change to the fair value-based method of accounting
        for stock-based employee compensation and amends the disclosure requirements
        of
        SFAS 123 to require disclosures in both the annual and interim financial
        statements about the method of accounting for stock-based employee compensation
        and the effect of the method used on reported results. The Company has adopted
        the disclosure rules of SFAS 148 and does not expect that this statement
        will
        have a material impact on its financial statements.
  F-11
 AMASYS
          Corporation
 
 Notes
          to Financial Statements
  In
          December 2004, the FASB issued SFAS No. 123R, (“SFAS 123R), Share-Based Payment,
          amending SFAS 123 to require companies to record as expense the effect
          of
          equity-based compensation, including stock options, over the applicable
          vesting
          period.  SFAS 123R also requires more extensive disclosures concerning
          stock options than required under prior standards.  The new standard
          applies to option grants made after adoption as well as options that are
          not
          vested at the date of adoption.  SFAS 123R becomes effective no later
          than fiscal periods beginning after December 15, 2005 for small business
          issuers.  The Company does not believe that the adoption of SFAS 123R
          will have a significant effect on its financial statements since its stock
          options are fully vested.
 
 Comprehensive
        Income (Loss)
 
 Comprehensive
        income (loss) is defined as the change in equity of a business enterprise
        during
        a period from non-owner sources. The Company’s comprehensive income (loss)
        includes 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 current
        period.  In accordance with paragraphs 18 through 20 of SFAS 130,
        these gains had also been included in Other Comprehensive Income as unrealized
        holding gains in the period in which they arose.  These gains are,
        therefore, deducted from Other Comprehensive Income to avoid including them
        twice.
 
 During
        the year ended June 30, 2006, the Company reclassified realized gains of
        $70,228
        and recognized net unrealized losses of $69,065 or its short-term
        investments.
 
 Accumulated
        other comprehensive income of $37,773 at June 30, 2006 represents the Company’s
        unrealized gain on its short-term investment.
 
 Earnings
        per Share
 
 Basic
        earnings per share (“EPS”) is computed by dividing net income 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 and the conversion of Preferred
        Stock as long as the effect is not anti-dilutive.
 
 Fair
        Value of Financial Instruments
 
 The
        Company considers cash, short-term investment, note receivable – related party,
        investment in common stock – related party, derivative asset and accounts
        payable to be financial instruments.  The carrying amounts reported in
        the balance sheet for cash, short-term investment and accounts payable and
        accrued expenses equal or closely approximate their fair value due to the
        short-term nature of these assets and liabilities.  The fair value of
        the derivative asset was determined using a Black-Scholes option pricing
        model.  The fair value of the Company's note receivable - related
        party approximates its face value of $856,954 and has been estimated taking
        into
        consideration the collectibility of the note based on the fair value of the
        collateral, the discount on the note using the effective interest rate, the
        adjustments when required under EITF 99-13, *Accounting by an Equity Method
        Investor for Investee Losses When the Investor Has Loans to and Investments
        in
        Other Securities of the Investee,* and the Company’s intent and ability to
        hold the note until maturity. The trading value of the Company’s investment in
        common stock-related party was $1,830,421 as of June 30, 2006.
 
 F-12
 
  AMASYS
            Corporation
 
 Notes
            to Financial Statements
 The
        note is convertible as follows:
 For
                  Years Ended June 30,2006
              2005Face
                  Value of note
              $856,954
              $856,954Conversion
                  price per share
              $1.00
              $0.90Number
                  of Comtex shares into which the note is convertible
              856,954
              952,171Comtex
                  share price
              $0.85
              $0.14
 
 
 **3.  Investment
        in Common Stock – Related Party**
 
 At
        June 30, 2006, the Company had a 16% ownership interest in
        Comtex.  The following information presents condensed balance sheet
        information as of June 30, 2006 and condensed income statement information
        for
        each of the years ended June 30, 2006 and 2005 for Comtex:
 
 **June
                  30,****2006**
                **(audited)**Current
                  assets
              
              $
              2,753,365Other
                  assets
              
              
              215,299Current
                  liabilities
              
              
              1,379,127Long-term
                  liabilities
              
              
              858,968
 
 
 **Year
                  Ended June 30,****2006**
                **(audited)**
              
              
              **2005**
                **(audited)**Revenues
              
              $
              7,676,524
              
              
              $
              7,970,492Gross
                  profit
              
              
              4,001,153
              
              
              
              4,195,360Net
                  income (loss)
              
              
              (458,107
              )
              
              
              728,586
 
 **4.  Note
        Receivable – Related Party**
 
 The
        Company was assigned a note receivable from Comtex in connection with the
        Assignment and Assumption Agreement, which was initially recorded at its
        estimated fair value.  In June 1999, the note was amended to include
        outstanding interest of approximately $254,000 into the principal amount
        of the
        note receivable, which was due July 1, 2002.  The note bears interest
        at 10% and is collateralized by a continuing interest in all receivables,
        purchase orders, and all patents and technology now or hereafter held or
        received by Comtex.
 
 F-13
 
  AMASYS
            Corporation
 
 Notes
            to Financial Statements
  In
            August 2001, the Company and Comtex signed an amendment to the Note Payable
            to
            AMASYS, (Second Amendment to Amended, Consolidated and Restated 10% Senior
            Subordinated Secured Note) (the “Amended Note”) extending the term of the
            Amended Note from July 1, 2002 until July 1, 2008.  In addition to the
            extension of the term, the Amended Note included a provision for the
            Company to
            convert all or a portion of the outstanding principal amount, plus accrued
            interest, into common stock of Comtex.  The Amended Note is
            convertible at a price of $1.00 per share, which price increases by $0.10
            upon
            each anniversary of the amendment.
 
 On
        December 9, 2003, the Company and Comtex executed an amendment to the Amended
        Note for the purpose of reducing the price at which the Amended Note may
        be
        converted into common stock of Comtex.   Pursuant to the Third
        Amendment, the Company agreed to subordinate the Amended Note to both Comtex’s
        note payable to its former landlord and pursuant to Comtex’s financing agreement
        with a third party financial institution.  In consideration for these
        subordination agreements, Comtex agreed to reduce the conversion price
        stipulated in the Amended Note from the previously-stated conversion price
        of
        $1.20 per share to $0.75 per share, and to increase this conversion price
        by
        $0.05 every one hundred and eighty (180) days thereafter, until June 9, 2008,
        when the conversion price will reach $1.20 per share.  This will be
        the final increase before the Note matures on 1 July 2008.  At the
        date of the amendment, the conversion price of the Amended Note was in excess
        of
        the stock price.  As of June 30, 2006, the Amended Note had a
        principal balance of $856,954.  Interest paid to AMASYS totaled
        approximately $86,000 for the years 2006 and 2005.  At June 30, 2005,
        the Company recognized losses in excess of basis of the investment in Comtex
        stock as an adjustment to the basis of the Note of $75,287 (See Note
        2).
  F-14
  AMASYS
          Corporation
 
 Notes
          to Financial Statements
 Quarter
                  Ended (UNAUDITED)September
                  30,
                2005
              December
                  31,
                2005
              March
                  31,
                2006
              June
                  30,
                2006Beginning
                  balance Note Receivable-Related Party
              $856,954
              $856,954
              $856,954
              $856,954Equity
                  in (earnings) losses allocated to the Note basis
              $0
              $0
              $0
              $(14,191)EITF
                  98-10 Adjustment
              $0
              $0
              $0
              $0Discount
                  on Note Receivable
              $(239,622)
              $(216,557)
              $(193,492)
              $(170,427)Ending
                  balance of Note Receivable-Related Party
              $617,332
              $640,397
              $663,462
              $672,336
 
 Quarter
                  Ended (UNAUDITED)September
                  30,
                2004
              December
                  31,
                2004
              March
                  31,
                2005
              June
                  30,
                2005Beginning
                  balance Note Receivable-Related Party
              $781,667
              $802,677
              $828,778
              $846,520Equity
                  in (earnings) losses allocated to the Note basis
              $15,093
              $19,068
              $13,029
              $10,434EITF
                  98-10 Adjustment
              $5,917
              $7,034
              $4,712
              $0Discount
                  on Note Receivable
              $(331,882)
              $(308,817)
              $(285,752)
              $(262,687)Note
                  Receivable-Related Party,
                net
                  of discount
              $470,795
              $519,962
              $560,767
              $594,267
  F-15
 
  AMASYS
            Corporation
 
 Notes
            to Financial Statements
 
 Since
        Comtex has experienced prior year losses, the Company evaluated the Note
        for
        collectibility.  As a result, the Company evaluated whether or not
        there is an impairment loss by comparing the fair value of the collateral
        (including cash and security interest in the accounts receivable of Comtex)
        to
        the carrying value of the Note of $672,336.  Since the fair value of
        the collateral exceeds the carrying value of the Note, the Company did not
        record an impairment charge at June 30, 2006.
 
 The
        Company calculated the fair value of the conversion option to be $701,486
        as of
        the date of the amendment using a Black-Scholes option-pricing
        model.  The $701,486 represents a discount on the Amended Note, which
        the Company is accreting into earnings over the life of the Amended Note
        under
        the effective interest method.  For the years ended June 30, 2006 and
        2005, the Company recognized interest income of $177,955, which included
        $92,260
        related to accretion of the discount.  The effective interest rate on
        the Amended Note was 21%.
 
 **5.  Related
        Party Transactions**
 
 The
        Company leases certain space from Comtex on a month-to-month
        basis.  For the years ended June 30, 2006 and 2005, the Company
        incurred rent expense of $3,632 and $3,600, respectively, to Comtex which
        is
        included in general and administrative expenses in the Company’s statements of
        operations.  In addition, certain Comtex employees provide accounting
        and corporate services to the Company.  For the years ended June 30,
        2006 and 2005, the Company paid consulting fees of $54,000 and $54,000,
        respectively, which is primarily included in professional services in the
        Company’s statements of operations.
 
 **6.  Earnings
        Per Share**
 
 The
        following table sets forth the computation of basic and diluted earnings
        per
        share:
 
 **Year
                  Ended June 30,****2006**
              
              
              **2005**Numerator:Net
                  income
              
              $
              281,531
              
              
              $
              175,366Preferred
                  stock dividend
              
              
              (98,000
              )
              
              
              (98,000
              )Numerator
                  for basic earnings per share
              
              
              183,531
              
              
              
              77,366Effect
                  of dilutive securities
              
              
              98,000
              
              
              
              98,000Numerator
                  for diluted earnings per share
              
              $
              281,531
              
              
              $
              175,366Denominator:Denominator
                  for basic earnings per share – weighted average shares
              
              
              2,207,350
              
              
              
              2,207,350Effect
                  of dilutive securities:Convertible
                  preferred stock
              
              
              1,960,000
              
              
              
              1,960,000Denominator
                  for diluted earnings per share
              
              
              4,167,350
              
              
              
              4,167,350Basic
                  earnings per share
              
              $
              0.08
              
              
              $
              0.04Diluted
                  earnings per share
              
              $
              0.07
              
              
              $
              0.04
  F-16
 
  AMASYS
            Corporation
 
 Notes
            to Financial Statements
  For
            the years ended June 30, 2006 and 2005, the 900,000 shares issuable upon
            the
            exercise of stock options have been excluded from the computation since
            their
            effect was not dilutive.  .
 
 **7.  Income
        Taxes**
 
 The
        following table reconciles the Company’s statutory tax rate to the effective tax
        rate:
  **Year
                    ended June 30,****2006**
                
                
                **2005**Tax
                    benefit at statutory rate
                
                $
                95,000
                
                
                
                34.00
                %
                
                $
                59,600
                
                
                
                34.0
                %Reconciling
                    items:State
                    income taxes
                
                
                11,100
                
                
                
                3.96
                %
                
                
                8,400
                
                
                
                4.8
                %Decrease
                    in Valuation allowance
                
                
                (106,800
                )
                
                
                (37.96
                )%
                
                
                (68,000
                )
                
                
                (38.8
                )%Effective
                    tax rate
                
                $
                0
                
                
                
                0.0
                %
                
                $
                0
                
                
                
                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, 2006 and 2005 are as follows:
   **June
                  30,**
                **2006**
              
              
              **June
                  30,**
                **2005**Deferred
                  tax assets:Net
                  operating losses carryforwards
              
              $
              504,706
              
              
              $
              2,851,242Discount
                  on note receivable- related party
              
              
              64,694
              
              
              
              99,716Equity
                  method reporting
              
              
              51,090
              
              
              
              29,171Total
                  deferred tax assets
              
              
              620,491
              
              
              
              2,980,129Deferred
                  tax liabilities:Derivative
                  asset
              
              
              (159,397
              )
              
              
              (39,749
              )Total
                  deferred tax liabilities
              
              
              (159,397
              )
              
              
              (39,749
              )Net
                  deferred tax asset
              
              
              461,094
              
              
              
              2,940,370Valuation
                  allowance
              
              
              (461,094
              )
              
              
              (2,940,370
              )Deferred
                  tax asset, net
              
              $
              —
              
              
              $
              —
  F-17
  AMASYS
          Corporation
 
 Notes
          to Financial Statements
  A
        reconciliation of net income per books with net loss per return is as
        follows:
 
 June
                  30,2006
              
              
              2005Net
                  income, per books
              
              $
              281,531
              
              
              $
              175,366Income
                  subject to tax not recorded on the books:Gain
                  on sale of short-term investment
              
              
              7,270
              
              
              
              4,660(Income)
                  expense recorded on the books not included on the return:Amortization
                  of discount on note receivable – related party
              
              
              (92,260
              )
              
              
              (92,260
              )Equity
                  in losses (earnings) of Comtex
              
              
              71,934
              
              
              
              (132,988
              )(Gain)  loss
                  on derivative asset
              
              
              (315,168
              )
              
              
              23,804Net
                  loss, per return
              
              $
              (46,693
              )
              
              $
              (21,418
              )Income
                  tax expense, per return
              
              
              -
                  0 -
              
              
              
              -
                  0 -Available
                  net operating loss (NOL) carryover from prior tax years
              
              $
              7,511,175
              
              
              $
              18,969,002NOL
                  generated
              
              
              46,693
              
              
              
              21,418Total
                  NOL carryover to future years
              
              $
              7,557,868
              
              
              $
              18,990,420NOL
                  expiring
              
              
              6,228,296
              
              
              
              11,479,245NOL
                  available to future years
              
              $
              1,329,572
              
              
              $
              7,511,175
 
 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, 2006.  The net change
        in the valuation allowance during the fiscal years ended June 30, 2006 and
        2005
        were decreases of $2,479,276 and $4,570,078, respectively, due primarily
        to the
        expiration of net operating loss carryovers.
 
 As
        of June 30, 2006 the Company had net operating loss carryforwards for federal
        income tax purposes of approximately $7.5 million, of which $6.2 million
        expire
        in 2006.  Utilization of these net operating losses may be subject to
        limitations under IRC Section 382, in the event of significant changes in
        stock
        ownership of the Company.
 
 F-18
 
  AMASYS
            Corporation
 Notes
              to Financial Statements
 **8.  Stockholders’
        Equity**
 
 Preferred
        Stock
 
 The
        Company is authorized to issue 1,000,000 shares of preferred stock, of which
        196,000 shares have been designated as Series A Preferred Stock (the “Preferred
        Stock”).  The Preferred Stock was issued to Pension Benefit Guaranty
        Corporation (PBGC) in connection with the Assignment and Assumption
        Agreement.  The Preferred Stock is convertible into shares of common
        stock of the Company at the rate of 10 shares of common stock for each share
        of
        Preferred Stock.  Holders of the Preferred Stock are entitled to
        receive dividends, when, as, and if, declared by the Board of Directors at
        a
        cumulative annual rate of $.50 per share.  The holders are entitled to
        a liquidation preference of $10 per share, plus an amount equal to any accrued
        but unpaid dividends to the payment date.  No such dividends have been
        declared to date.  The holders of the Preferred Stock are entitled to
        vote, along with the common stockholders, based on each share of Preferred
        Stock, except in certain circumstances, which require an affirmative vote
        of a
        majority of the holders of Preferred Stock.  The Company has the right
        to redeem the Preferred Stock, after payment of the PBGC Note, at a price
        equal
        to the greater of $10.50 per share or an amount computed based on market
        value,
        as defined, plus accrued but unpaid dividends.
 
 At
        June 30, 2006, the aggregate cumulative preferred dividends were
        $980,000.
 
 The
        Company adopted a Stock Option Plan (the “Plan”) under which 950,000 shares of
        common stock were reserved for issuance upon exercise of granted stock
        options.  The Plan provides for grants of incentive stock options to
        eligible employees, officers, and Directors of the Company.  Eligible
        employees are defined as any persons regularly employed by the Company,
        including key employees and consultants.  In November 1996, 950,000
        stock options were granted with an exercise price equal to fair value at
        the
        date of grant.  The term of the options granted under the Plan may not
        exceed 10 years.  The stock options granted vested
        immediately.
 
 At
        June 30, 2006 and 2005, 900,000 stock options were outstanding and exercisable,
        respectively.  The exercise price of all options is $0.01 per
        share.  The weighted average remaining contractual life of options
        outstanding at June 30, 2006 and 2005 is 0.3 years and 1.3 years,
        respectively.
  F-19
 
  AMASYS
              Corporation
 
 Notes
              to Financial Statements
 **9.
        Selected Quarterly Financial Information (Unaudited)**
 
 The
        following is a summary of the quarterly results of operations for the years
        ended June 30, 2006 and 2005.
 
 **Quarter
                  Ended****September
                  30,**
                **2005**
              
              
              **December
                  31,**
                **2005**
              
              
              **March
                  31,**
                **2006**
              
              
              **June
                  30,**
                **2006**Operating
                  costs and expenses
              
              $
              70,616
              
              
              $
              41,461
              
              
              $
              71,325
              
              
              $
              26,486Other
                  (expense) income
              
              
              306,454
              
              
              
              (134,798
              )
              
              
              (83,843
              )
              
              
              403,605Net
                  (loss) income
              
              
              235,838
              
              
              
              (176,259
              )
              
              
              (155,168
              )
              
              
              377,119Net
                  (loss) income per share:Basic
              
              $
              0.10
              
              
              $
              (0.09
              )
              
              $
              (0.08
              )
              
              $
              0.16Diluted
              
              $
              0.06
              
              
              $
              (0.09
              )
              
              $
              (0.08
              )
              
              $
              0.09Weighted
                  average
                number
                  of shares:Basic
              
              
              2,207,350
              
              
              
              2,207,350
              
              
              
              2,207,350
              
              
              
              2,207,350Diluted
              
              
              4,167,350
              
              
              
              2,207,350
              
              
              
              2,207,350
              
              
              
              4,167,350
 
 **Quarter
                  Ended****September
                  30, 2004**
              
              
              **December
                  31, 2004**
              
              
              **March
                  31,**
                **2005**
              
              
              **June
                  30,**
                **2005**Operating
                  costs and expenses
              
              $
              64,344
              
              
              $
              47,486
              
              
              $
              32,781
              
              
              $
              36,227Other
                  (expense) income
              
              
              (20,043
              )
              
              
              113,502
              
              
              
              95,772
              
              
              
              166,973Net
                  (loss) income
              
              
              (84,387
              )
              
              
              66,016
              
              
              
              62,991
              
              
              
              130,746Net
                  (loss) income per share:Basic
              
              $
              (0.05
              )
              
              $
              0.02
              
              
              $
              0.02
              
              
              $
              0.05Diluted
              
              $
              (0.05
              )
              
              $
              0.02
              
              
              $
              0.02
              
              
              $
              0.03Weighted
                  average
                number
                  of shares:Basic
              
              
              2,207,350
              
              
              
              2,207,350
              
              
              
              2,207,350
              
              
              
              2,207,350Diluted
              
              
              2,207,350
              
              
              
              4,167,350
              
              
              
              4,167,350
              
              
              
              4,167,350
  F-20
 
  AMASYS
              Corporation
 
 Notes
              to Financial Statements
  **Note
            10. Subsequent Events**
 
 On
        September 26, 2006, AMASYS signed an agreement to acquire all of the shares
        of
        common stock of World Mineral Corporation, a Nevada corporation (WMC) from
        WMC
        shareholders in exchange for an aggregate of 14,775,000 newly issued shares
        of
        AMASYS common stock.  As part of the contemplated transaction, AMASYS
        has signed agreements to redeem and convert all of its outstanding Series
        A
        Preferred Stock.
 
 Following
        the closing of the
        contemplated transaction, WMC will become a wholly-owned subsidiary of AMASYS
        and the newly issued shares held by WMC will represent approximately 74%
        percent
        of the total outstanding shares of common stock of AMASYS.
 AMASYS
        also executed agreements on September 25, 2006 to redeem from the holders
        of its
        Preferred Stock, pro rata to their respective ownership interests, 55,209
        shares
        of AMASYS Series A Preferred Stock (the “Series A”) in consideration for: (a)
        AMASYS’ entire interest in the outstanding promissory note in favor of AMASYS
        made by Comtex News Network, Inc. (Comtex) in the principal amount of $857,000;
        and (b) 2,153,437 shares of Comtex common stock.  Pursuant to the
        agreement, the holders of the Series A converted the balance of the Series
        A
        shares, together with any and all rights to accrued but unpaid dividends
        thereon, into 2,111,860 shares of AMASYS Common Stock.  Therefore,
        effective September 25, 2006, AMASYS no longer owns the promissory note made
        by
        Comtex and AMASYS no longer holds any shares of Comtex common
        stock.
 
 On
        November 15, 2006, C.W. Gilluly, the president of the Company, exercised
        his
        options to purchase 350,000 restricted shares (out of a total of 900,000
        options) and the Company issued 350,000 restricted shares to him. The remaining
        550,000 options expired on November 16, 2006.
 
 On
        May 24, 2007, the Company borrowed $10,000 from Private Capital Group, LLC
        at
        WSJ Prime + 1.75% maturing on or before December 31, 2007.  The
        Company also promised to Grant to Lender 1,000,000 shares of restricted common
        stock and to issue a Warrant to Lender for an additional 1,000,000 shares
        of
        restricted common stock at an exercise price of $0.01 per share as inducement
        to
        Lender to make the loan.  There are 2, 207,350 shares of common stock
        outstanding at June 30, 2006.  Private Capital Group, LLC is
        affiliated with World Mineral Corporation, which signed the Agreement and
        Plan
        of Share Exchange by and among AMASYS Corporation, World Mineral Corporation
        and
        the shareholders of World Mineral Corporation, dated September 26,
        2006.
 
 On
        May 24, 2007, the Company borrowed $10,000 from C.W. Gilluly at WSJ Prime
        +
        1.75% maturing on or before December 31, 2007.  The Company also
        promised to Grant to Lender 1,000,000 shares of restricted common stock and
        to
        issue a Warrant to Lender for an additional 1,000,000 shares of restricted
        common stock at an exercise price of $0.01per share as inducement to Lender
        to
        make the loan.  There are 2, 207,350 shares of common stock
        outstanding at June 30, 2006.
 
 As
        previously reported, Director Robert F. Delaney retired from the board of
        directors effective November 27, 2006.
    F-21