UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


WASHINGTON, D.C. 20549





FORM 10-K





xANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934





For the fiscal year ended December 31, 2014.





OR





oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934





For the transition period from __________ to ___________





Commission File Number : 0-28847





FORMCAP CORP.


(formerly Gravitas International, Inc.)


(Exact name of registrant as specified in its charter)





Nevada

1006772219(State or other jurisdiction of incorporation or organization)

(IRS Employer Identification No.)




50 West Liberty Street, Suite 880, Reno, NV 89501


(Address of principal executive offices, including zip code)





775-285-5775


(Registrant’s telephone number, including area code)





Title of Each Class

Name of Exchange on which RegisteredPreferred Stock ($0.001 par value)

NASDAQ OTCBBCommon Stock ($0.001 par value)





Securities registered pursuant to Section 12(b) of the Act: None





Securities registered pursuant to Section 12(g) of the Act: Common Stock, $0.001 par value





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





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





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





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





Indicate by check 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. x





Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a not-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.





Large accelerated filer
o
Accelerated filer
oNon-accelerated filer
o
Smaller reporting company
x





Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes o No x





The aggregate market value of the voting and non-voting common equity held by non-affiliates as of June 30, 2014 was $10,266,822 based upon the closing sales price of the Registrant’s Common Stock as reported on the Over-the-Counter Bulletin Board of $0.0227





At April 14, 2015the Company had outstanding 88,841,833 shares of Common Stock, of $0.001 par value per share.













TABLE OF CONTENTS


PART I



3Item 1.
Business


3Item 1A.
Risk Factors


5Item 1B.
Unresolved Staff Comments


5Item 3.
Legal Proceedings


5Item 4.
Mine Safety Disclosures


5PART II



6Item 5.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities


6Item 6.
Selected Financial Data.


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


8Item 7A.
Quantitative and Qualitative Disclosures about Market Risk.


10Item 8.
Financial Statements and Supplementary Data


11Item 9.
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.


11Item 9A (T).
Controls and Procedures.


11Item 9B.
Other Information.


11PART III



12Item 10.
Directors, Executive Officers, Promoters, Control Persons and Corporate Governance.


12Item 11.
Executive Compensation


12Item 13.
Certain Relationships and Related Transactions, and Director Independence.


12Item 14.
Principal Accountant Fees and Services.


12PART IV



13Item 15.
Exhibits and Financial Statement Schedules


13
  2


PART I




This Annual Report on Form 10-K contains forward-looking statements that have been made pursuant to the provisions of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1995 and concern matters that involve risks and uncertainties that could cause actual results to differ materially from historical results or from those projected in the forward-looking statements. Discussions containing forward-looking statements may be found in the material set forth under “Business,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in other sections of this Form 10-K. Words such as “may,” “will,” “should,” “could,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “continue” or similar words are intended to identify forward-looking statements, although not all forward-looking statements contain these words. Although we believe that our opinions and expectations reflected in the forward-looking statements are reasonable as of the date of this Report, we cannot guarantee future results, levels of activity, performance or achievements, and our actual results may differ substantially from the views and expectations set forth in this Annual Report on Form 10-K. We expressly disclaim any intent or obligation to update any forward-looking statements after the date hereof to conform such statements to actual results or to changes in our opinions or expectations.




Readers should carefully review and consider the various disclosures made by us in this Report, set forth in detail in Part I, under the heading “Risk Factors,” as well as those additional risks described in other documents we file from time to time with the Securities and Exchange Commission, which attempt to advise interested parties of the risks, uncertainties, and other factors that affect our business. We undertake no obligation to publicly release the results of any revisions to any forward-looking statements to reflect anticipated or unanticipated events or circumstances occurring after the date of such statements.




Item 1. Business




General





FormCap Corp. (the “Company” or “FormCap”) was incorporated in the State of Florida on April 10, 1991, under the name of Aarden-Bryn Enterprises, Inc. The Company become a foreign registrant in the State of Nevada on December 24, 1998, and became qualified to transact business in the State of Nevada.





Since its incorporation, the Company has changed its name several times. On August 27, 1998 the Company changed its name to Corbett’s Cool Clear WTAA, Inc., on September 24, 1999 to WTAA International, Inc., on December 6, 2001 to Gravitas International, Inc., and finally to its current name, FormCap Corp. on October 12, 2007.





On September 18, 2007, the Company merged the Florida jurisdiction and the Nevada jurisdiction into one Nevada jurisdiction.





The Company has no operations since November of 2003 and the Company’s ability to continue as a going concern is dependent on successful future operations and obtaining the necessary debt and equity financing for future acquisition. In accordance with SFAS No. 7 the Company is considered to be in the development stage.





These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which assumes that the Company will be able to meet its obligations and continue its operations for its next fiscal year. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classification of assets and liabilities should the Company be unable to continue as a going concern. At December 31, 2014, the Company had not yet achieved profitable operations, has accumulated losses of $22,969,852since inception and expects to incur further losses in the development of its business, of which cast substantial doubt about the Company’s ability to continue as a going concern.





The Company’s ability to continue as a going concern is dependent upon future profitable operations and/or the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due.





Management has obtained additional funds by related party’s advances and loans from third parties; however there is no assurance that this additional funding is adequate and further funding may be necessary.




3




On November 19, 2013 the Company executed a Definitive Agreement with: Kerr Energy Group and Keta Oil & Gas LLC (Kerr and Keta) both incorporated in Wichita, Kansas. Pursuant to the terms of the Agreement the Company paid Kerr and Keta a non-refundable deposit in the amount of $25,000 (the “Deposit”) to be applied to the purchase price of oil leases to be purchased by Formcap, in Cowley County Kansas. The Company also agreed to issue Kerr and Keta a total of 200,000 Rule 144 shares of FormCap.




In addition, the Company paid Kerr and Keta two hundred dollars ($200.00) per acre for up to 2,400 acres of Leases, at total cost not exceeding $480,000 within 30 days of execution of the Agreement, subject to final due diligence by the Company. The Company owns 100% of the Leases (80% net revenue to FormCap; 20% freehold royalty), and will be the operator. The Company will have the option to purchase additional leases in Cowley County from Kerr and Keta under an Area of Mutual Interest, the terms of which are set forth in the Agreement. FormCap is required to drill one well in each of the first two years of the lease term to maintain its interest in the Leases.




The Company will also have the option to participate in the drilling of up to six exploration or development wells on lands currently owned by Keta and Kerr under terms set out in the agreement.




On November 7, 2013 the Board of Directors approved the issuance of 200,000 Rule 144 shares to Kerr and Keta.





During January 2014, Ironridge Global IV, Ltd. ("Ironridge") purchased from Kerr and Keta the Company’s obligation in the aggregate amount of $671,938.90 (the "Claim Amount"). Subsequently, the Company offered to settle the Claim Amount by the issuance of unrestricted and fully tradable shares of the Company's common stock. Ironridge accepted the Company's settlement offer, subject to a hearing on the fairness of the settlement terms. On February 21, 2014, the Company, Ironridge and the CEO of the Company entered into a Stipulation Order for the settlement on the terms agreed on by Ironridge and the Company. On February 21, 2014, a California Superior Court for the County of Los Angeles (the "State Court") held a hearing on the fairness of the Company's settlement offer to Ironridge. Pursuant to the court order issued by the State Court on February 21, 2014, the shares of the Company's common stock were deemed issued in settlement of the claims (subject to certain adjustments based on the future trading value of the stock) when delivered to Ironridge. On February 24, 2014 the Company's transfer agent delivered to Ironridge 1,000,000 shares of the Company's common stock. The shares issued to Ironridge were freely tradable and exempt from registration under the Securities Act of 1933 and the California Corporations Code. The number of shares issued to Ironridge was subject to adjustment based trading price of the Company's stock such that the value of the shares is sufficient to cover the Claim Amount, a 10% agent fee amount and Ironridge's reasonable legal fees and expenses ( the "Final Amount"). Under the Stipulation Order, Ironridge could not be the beneficial owner of more than 9.99% of the Company's outstanding shares of common stock until the Final Amount is paid. Further Ironridge agreed not to exercise any voting rights of the shares issued to it nor influence or cause any change in control of the Company.





On March 11, 2014 Ironridge paid Kerr and Keta $305,000 in full and final settlement of all monies due in connection with the acquisition of 2,400 acres of the Cowley leases. Ironridge was obligated to provide $367,000 to the Company to fund the drilling of two test wells on the Cowley lands.





On May 27, 2014 the Company announced that that a drilling contract had been executed between Val Energy Inc., and FormCap’s operator, Tiger Oil & Gas LLC to commence drilling on the 2,400 acres of prospective oil and gas leases owned by the Company in Cowley County, Kansas, and submitted a Notice of Intent to Drill to the Kansas Corporation Commission.





During June 2014, Ironridge defaulted
 on its obligation to fund the drilling program and on July 3, 2014, Ironridge was deregistered. On July 10, 2014 the Company announced that the drilling program had been postponed and on August 1, 2014 the Intent to Drill licence expired.





On May 23, 2014 a majority of the shareholders consented to a reverse stock split in the ratio of 1 new share for every 10 old shares held by shareholders. The reverse stock split
 took effect on or about July 31, 2014.





On June 19, 2014 Mr. Graham Douglas resigned as Director, Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer. On June 20 2014, Mr. Brad Moynes was appointed to succeed Mr. Douglas in those positions.





The Company conducted an impairment test of the Cowley Leases as at December 31, 2014 and determined that the leases were impaired. Accordingly, the Company recorded a charge of $516,802 against the Leases.




4




Item 1A. Risk Factors




Not Applicable




Item 1B. Unresolved Staff Comments




None





Item 2. Properties





The Company does not own any properties. The Company currently has no policy with respect to investments or interests in real estate, real estate mortgages or securities of, or interests in, persons primarily engaged in real estate activities.





On October 20, 2009, the company acquired 5,313 acres of oil and gas leases (“leases”), all with primary terms of five years initiated in June 2009. The leases, known as the Weber City Prospect, are located in Curry County, New Mexico, which lies on the eastern most side of New Mexico bordering the State of Texas. The Company had acquired a 100% working interest (80% Net Revenue Interest) from Atlas Larunas LLC for $250,000.





On February 15, 2011, the Company assigned all its rights in the leases to Rich Investments Ltd. (“Rich”) and Leare Developments Ltd. (“Leare”), under the terms of a loans settlement agreement whereby Rich and Leare accepted the assignment of the leases in full and final satisfaction of the outstanding indebtedness of the Company to each of Rich and Leare.




Item 3. Legal Proceedings




None




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




None




5




PART II




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




The Company’s Common Stock is presently quoted on the National Association of Securities Dealers’ Over-the-Counter Bulletin Board and on the “Pink Sheets” under the symbol “FRMC”.




The table below reflects the high and low “bid” and “ask” quotations for the Company’s Common Stock for each of the calendar years covered by this report, as reported by the National Association of Securities Dealers Over the Counter Bulletin Board National Quotation System. The prices reflect inter-dealer prices, without retail mark-up, markdown or commission and do not necessarily represent actual transactions.




2014

High


Low1st Quarter


5.800



0.3182nd Quarter


0.535



0.0963rd Quarter


0.250



0.0254th Quarter


0.070



0.0152013

High


Low1st Quarter


0.510



0.0082nd Quarter


0.105



0.0123rd Quarter


0.200



0.0854th Quarter


1.920



0.200




As of December 31, 2014, there were 88,841,833 common shares issued and approximately 90 shareholders on record. The Company believes that an undefined number of shares of its common stock are held in either nominee name or street name brokerage accounts. Consequently, the Company is unable to determine the exact number of beneficial owners of its common stock.




The Company has not paid cash dividends on its common stock. The Company anticipates that for the foreseeable future any earnings will be retained for use in its business, and no cash dividends will be paid on the common stock. Declaration of common stock dividends will remain within the discretion of the Company’s Board of Directors and will depend upon the Company’s growth, profitability, financial condition and other relevant factors.




The Transfer Agent for the Company’s Common Stock is Action Stock Transfer, 2469 E. Fort Union Blvd, Suite 214, Salt Lake City, UT 84121





Section 15(g) of the Securities Exchange Act of 1934:




The Company’s shares are covered by Section 15(g) of the Securities Exchange Act of 1934, as amended that imposes additional sales practice requirements on broker/dealers who sell such securities to persons other than established customers and accredited investors (generally institutions with assets in excess of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000 or $300,000 jointly with their spouses). For transactions covered by this Section 15(g), the broker/dealer must make a special suitability determination for the purchase and have received the purchaser's written agreement to the transaction prior to the sale. Consequently, Section 15(g) may affect the ability of broker/dealers to sell the Company’s securities and also may affect your ability to sell your shares in the secondary market.




6




Section 15(g) also imposes additional sales practice requirements on broker/dealers who sell penny securities. These rules require a one page summary of certain essential items. The items include the risk of investing in penny stocks in both public offerings and secondary marketing; terms important to an understanding of the function of the penny stock market, such as "bid" and "offer" quotes, a dealers "spread" and broker/dealer compensation; the broker/dealer compensation, the broker/dealers duties to its customers, including the disclosures required by any other penny stock disclosure rules; the customers rights and remedies in causes of fraud in penny stock transactions; and, the NASD's toll free telephone number and the central number of the North American Administrators Association, for information on the disciplinary history of broker/dealers and their associated persons.




RECENT SALES OF RESTRICTED SECURITIES





On February 27, 2014, 1,000,000 common shares were issued in connection with a financing agreement




On August 27, 2014, 500,000 common shares were issued in connection with a consulting contract




On August 27, 2014, 50,000,000 common shares were issued in connection with a debt settlement agreement




On December 4, 2014, 28,000,000 common shares were issued in connection with an assignment of creditors and debt settlement agreement




Item 6. Selected Financial Data.




Not applicable.




7




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




The following discussion of our financial condition and results of operations should be read in conjunction with the financial statements and notes thereto and the other financial information included elsewhere in this report. Certain statements contained in this report, including, without limitation, statements containing the words “believes,” “anticipates,” “expects” and words of similar import, constitute “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks and uncertainties. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of certain factors, including our ability to create, sustain, manage or forecast our growth; our ability to attract and retain key personnel; changes in our business strategy or development plans; competition; business disruptions; adverse publicity; and international, national and local general economic and market conditions. Our audited financial statements are stated in United States Dollars and are prepared in accordance with United States Generally Accepted Accounting Principles.





Overview





The Company does not currently engage in any business activities that provide cash flow.





On September 30, 2013 the Company executed a Definitive Agreement with: Kerr Energy Group and Keta Oil & Gas LLC (Kerr and Keta) both incorporated in Wichita, Kansas.





Pursuant to the terms of the Agreement the Company paid Kerr and Keta a non-refundable deposit in the amount of $25,000 (the “Deposit”) to be applied to the purchase price of oil leases to be purchased by FormCap, in Cowley County Kansas. The Company will also issue Kerr and Keta a total of 200,000 Rule 144 shares of FormCap.





In addition, the Company paid Kerr and Keta two hundred dollars ($200.00) per acre for up to 1,500 acres of Leases, at total cost not to exceed $300,000 within 30 days of execution of the Agreement, subject to final due diligence by the Company. The Company will own 100% of the Leases (80% net revenue to FormCap; 20% freehold royalty), and will be the operator. The Company will have the option to purchase additional leases in Cowley County from Kerr and Keta under an Area of Mutual Interest, the terms of which are set forth in the Agreement. FormCap is required to drill one well in each of the first two years of the lease term to maintain its interest in the Leases.





The Company will also have the option to participate in the drilling of up to six exploration or development wells on lands currently owned by Keta and Kerr under terms set out in the agreement.





On October 28, 2013 the Company, and Kerr and Keta agreed to extend the closing date for the purchase of the oil exploration leases to January 15, 2014. The Company is to pay Kerr and Keta $50,000 on or before November 15, 2013, $50,000 on or before December 15 2013 and the remaining balance to a maximum of $200,000 by January 14, 2014. These funds to be held in trust and applied toward the acquisition purchase price payable on January 15, 2014. In addition, the Company has agreed to issue 200,000 Rule 144 shares in the company to Kerr and Keta.





On November 7, 2013 the Board of Directors approved the issuance of 200,000 Rule 144 shares to Kerr and Keta.





During January 2014, Ironridge Global IV, Ltd. ("Ironridge") purchased from Kerr and Keta the Company’s obligation in the aggregate amount of $671,938.90 (the "Claim Amount"). Subsequently, the Company offered to settle the Claim Amount by the issuance of unrestricted and fully tradable shares of the Company's common stock. Ironridge accepted the Company's settlement offer, subject to a hearing on the fairness of the settlement terms. On February 21, 2014, the Company, Ironridge and the CEO of the Company entered into a Stipulation Order for the settlement on the terms agreed on by Ironridge and the Company. On February 21, 2014, a California Superior Court for the County of Los Angeles (the "State Court") held a hearing on the fairness of the Company's settlement offer to Ironridge. Pursuant to the court order issued by the State Court on February 21, 2014, the shares of the Company's common stock were deemed issued in settlement of the claims (subject to certain adjustments based on the future trading value of the stock) when delivered to Ironridge. On February 24, 2014 the Company's transfer agent delivered to Ironridge 10,000,000 shares of the Company's common stock. The shares issued to Ironridge were freely tradable and exempt from registration under the Securities Act of 1933 and the California Corporations Code. The number of shares issued to Ironridge was subject to adjustment based trading price of the Company's stock such that the value of the shares is sufficient to cover the Claim Amount, a 10% agent fee amount and Ironridge's reasonable legal fees and expenses ( the "Final Amount"). Under the Stipulation Order, Ironridge could not be the beneficial owner of more than 9.99% of the Company's outstanding shares of common stock until the Final Amount is paid. Further Ironridge agreed not to exercise any voting rights of the shares issued to it nor influence or cause any change in control of the Company.




8





On March 11, 2014 Ironridge paid Kerr and Keta $305,000 in full and final settlement of all monies due in connection with the acquisition of 2,400 acres of the Cowley leases. Ironridge was obligated to provide $367,000 to the Company to fund the drilling of two test wells on the Cowley lands.





On May 27, 2014 the Company announced that that a drilling contract had been executed between Val Energy Inc., and FormCap’s operator, Tiger Oil & Gas LLC to commence drilling on the 2,400 acres of prospective oil and gas leases owned by the Company in Cowley County, Kansas, and submitted a Notice of Intent to Drill to the Kansas Corporation Commission.





During June 2014, Ironridge defaulted upon its obligation to fund the drilling program and on July 3, 2014, Ironridge was deregistered. On July 10, 2014 the Company announced that the drilling program had been postponed and on August 1, 2014 the Intent to Drill license expired.




The Company conducted an impairment test of the Cowley Leases as at December 31, 2014 and determined that the leases were impaired. Accordingly, the Company recorded a charge of $516,802 against the Leases.





On May 23, 2014 a majority of the shareholders consented to a reverse stock split in the ratio of 1 new share for every 10 old shares held by shareholders. The reverse stock split is expected to take effect on or about July 31, 2014.





On June 19, 2014 Mr. Graham Douglas resigned as Director, Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer. On June 20 2014, Mr. Brad Moynes was appointed to succeed Mr. Douglas in those positions.





Going Concern





We have incurred recurring losses to date. Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation.





We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.





Results of Operations for the Fiscal Years Ended December 31, 2014 and 2013




The audited operating results and cash flows are presented for the years ended December 31, 2014 and 2013. We did not earn any revenues for the years ended December 31, 2014 and 2013.




Net Loss: For the year ended December 31, 2014 we had a net loss of
 $8,610,978 as compared with a net loss of $2,386,213 for the year ended December 31, 2013.




Operating Expenses. For the year ended December 31, 2014, we had total operating expenses of $401,032 as compared to $112,203 for the year ended December 31, 2014. The increase is due to an increase of $50,928 in consulting services and the impairment charge recorded against the Cowley Leases, offset by a decrease in General and administrative expenses of $47,361.




Consulting Fees. For the year ended December 31, 2014, we had consulting fees of $64,950 as compared to $14,022 for the previous year. The increase was attributable to the use of additional financial consulting services during 2014




General and administrative expenses: For the year ended December 31, 2014 we had general and administrative expenses of $50,820, a decrease of $47,361 as compared with $98,181 for the year ended December 31, 2013.




Filing, Transfer agents’ expenses increased by $694 from $8,731 during the year ended December 31, 2013 to $9,425 during the year ended December 31, 2014 as a result of corporate activity.




9




The Company did not incur any Investor and public relations expenses during the year ended December 31, 2014. During the year ended December 31, 2013, the Company incurred $58,741 to develop a corporate branding strategy and a new website.




Audit and accounting expenses for the year ended December 31, 2014 amounted to $30,750, an increase of $4,583 as compared with $26,167 incurred during the year ended December 31, 2013. The increase in expenditure in this category resulted from additional professional services provided during 2014.




Legal expenses for the year ended December 31, 2014 amounted to $6,267. The Company incurred $2,075 in connection with the Ironridge financing transaction and recognized a charge for legal services relating to the year ended December 31, 2011, which had not been presented to the Company. The Company did not incur legal expenses for the year ended December 31, 2013.




The Company incurred management fees of $3000 during the year ended December 31, 2014 (year ended December 31, 2013 – Nil)




Losses on foreign exchange transactions amounted to $1,117 during the year ended December 31, 2014, as compared with a loss of $1,580 during the year ended December 31, 2013. These losses arose as a result of fluctuations in the exchange rates between the US Dollar and foreign currencies.




The Company incurred a loss on impairment of assets of
 $516,802 in connection with the Ironridge financing transaction. We did not incur a loss on impairment of assets during the years ended December 31, 2013.




Interest Expense. The Company incurred insignificant interest expense charges during the years ended December 31, 2014 and 2013, respectively.




Loss on settlement of debt:During the year ended December 31, 2014 we incurred a losses of 
 $7,961,406 in connection with the settlement of certain debts owed to related parties, an increase of $5,687,406, as compared with losses of of $2,274,000 on the settlement of debts owed to related parties incurred during the year ended December 31, 2013.




Liquidity and Capital Resources: During the year ended December 31, 2014 our operating activities consumed cash in the amount of $20,932, a decrease of $57,194 as compared to cash consumed by operations of $78,126 during the year ended December 31, 2013. During the year ended December 31, 2014 we did not undertake any investing activity as compared with the year ended December 31, 2013, during which we invested $6,802 in the purchase of oil and gas leases. During the year ended December 31, 2014, we obtained financing in the amount of $23,300 in the form of convertible notes issued to unrelated parties of $18,300 and convertible notes issued to related parties of $5,000 as compared with $70,790, convertible notes issued to unrelated parties during the year ended December 31, 2013.. During the year ended December 31, 2014 we repaid convertible note payable in the amount of $3,000 (year ended December 31, 2013 – Nil)




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





The Company does not hold any derivatives or investments that are subject to market risk. The carrying values of any financial instruments, approximate fair value as of those dates because of relatively short-term maturity of these instruments which eliminates any potential market risk associated with such instruments.




10




Item 8. Financial Statements and Supplementary Data




See Item 15




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




Not applicable




Item 9A (T). Controls and Procedures.




As supervised by our board of directors and our principal executive and principal financial officers, management has established a system of disclosure controls and procedures and has evaluated the effectiveness of that system. The system and its evaluation are reported on in the below Management's Annual Report on Internal Control over Financial Reporting. Our principal executive and financial officer has concluded that our disclosure controls and procedures (as defined in the 1934 Securities Exchange Act Rule 13a-15(e)) as of December 31, 2014, are not effective, based on the evaluation of these controls and procedures required by paragraph (b) of Rule 13a-15.





Management's Annual Report on Internal Control over Financial Reporting





Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rule 13a-15(f) of the Securities Exchange Act of 1934 (the "Exchange Act"). Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles.





Management assessed the effectiveness of internal control over financial reporting as of December 31, 2014. We carried out this assessment using the criteria of the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework. This annual report does not include an attestation report of our registered public accounting firm regarding internal control over financial reporting. Management's report was not subject to attestation by our registered public accounting firm, pursuant to temporary rules of the Securities and Exchange Commission that permits us to provide only management's report in this annual report. Management concluded in this assessment that as of December 31, 20124, our internal control over financial reporting is not effective.




There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fourth quarter of our 2013 fiscal year that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.




Item 9B. Other Information.




None.




11




PART III




Item 10. Directors, Executive Officers, Promoters, Control Persons and Corporate Governance.




Directors and Executive Officers





The following table furnishes the information concerning Company directors and officers as of the date of this report. The directors of the Registrant are elected every year and serve until their successors are elected and qualify. They are:





Name

TitleBradley Moynes

President, Secretary, Treasurer and Director





Notes:




On June 19, 2014, Graham Douglas resigned the positions of President, Treasurer, Secretary and Director and Bradley Moynes was appointed to these positions.




Item 11. Executive Compensation




None





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





As of December 31, 2014, there were
 88,766,833 shares of common stock outstanding.





The following table sets forth, as of December 31, 2014, the number of shares of Common Stock owned of record and beneficially by executive officers, directors and persons who holds 5% or more of the outstanding Common Stock of the company.




Class

Name and Address of Beneficial Owner

Amount and Nature of Beneficial Ownership

Percentage of ClassCommon Stock

Bradley Moynes

50,219,778 – Director


54.45
%





As of December 31, 2014 the Directors and Officers of the Company as a group held 50,219,778 shares (54.45%)




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




None




Item 14. Principal Accountant Fees and Services.




Audit Fees. Audit fees for the audits of our Annual Reports on Forms 10-K for the years ended December 31, 2014 and 2013 were $10,000 and $7,500 respectively.


Review Fees:Review fees of our Quarterly Reports on Forms 10-Q for
 the years ended December 31, 2014 and 2013 were $7,500 and $7,500 respectively.


12




PART IV




Item 15. Exhibits and Financial Statement Schedule





(a) Index to the Financial Statements





FORMCAP CORP.


(A Development Stage Company)





AND


FINANCIAL STATEMENTS





December 31, 2013 and 2012




Contents




Audit Report Of Independent Accountants


14Balance Sheets – December 31, 2014 and 2013


15Statements Of Operations For The Years Ended December 31, 2014 and 2013


16Statements Of Stockholder’s Deficit For The Years Ended December 31, 2014 and 2013


17Statements Of Cash Flows For The Years Ended December 31, 2014 and 2013


18Notes To Financial Statements December 31, 2014 and 2013


19
  13


REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM


To the Board of Directors and shareholders' FormCap
 Corp.  We
 have audited the accompanying balance sheets of FormCap Corp. (the Company) as
 of December 31, 2014 and 2013 and the related statements of operations,
 stockholders' deficit and cash flows for the years 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 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 audits to obtain reasonable assurance about whether the
 consolidated financial statements are free of material misstatement. The
 Company is not required to have, nor were we engaged to perform, an audit of
 its internal control over financial reporting. Our audits included
 consideration of internal control over financial reporting as a basis for
 designing audit procedures that are appropriate in the circumstances, but not
 for the purpose of expressing an opinion on the effectiveness of the
 Company's internal control over financial reporting. Accordingly, we express
 no such opinion. An audit also includes examining, on a test basis, evidence
 supporting the amounts and disclosures in the financial statements, 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 FormCap Corp. as of December 31,
 2014 and 2013, and the results of their operations and cash flows for the years
 then ended, in conformity with U.S. generally accepted accounting principles.  The
 accompanying financial statements have been prepared assuming that the Company
 will continue as a going concern. As discussed in Note 3 to the financial
 statements, the company has not yet established an ongoing source of revenues
 sufficient to cover its operating costs as of December 31, 2014 which raises
 substantial doubt about its ability to continue as a going concern.
 Management's plans concerning these matters are also described in Note 3. The
 financial statements do not include any adjustments that might result from the
 outcome of this uncertainty.   /s/
 Sadler, Gibb & Associates, LLC  Salt
 Lake City, UT April
 15, 2015











14




FORMCAP CORP.


Balance Sheets – December 31, 2014 and 2013




ASSETSDecember 31,

December 31,2014

2013CURRENT ASSETSCash

$
278


$
910Prepayments


6,875



-Related Party Note Receivable


8,170



9,266Total Current Assets


15,323



10,176OIL AND GAS LEASE RIGHTS


-



101,802TOTAL ASSETS

$
15,323


$
111,978LIABILITIES AND STOCKHOLDERS' DEFICITCURRENT LIABILITIESAccounts payable and accrued liabilities

$
23,107


$
101,297Accounts payable –related parties


104,357Convertible promissory notes payable- related parties


113,490



48,990Convertible promissory notes payable


125,100



111,800Notes payable


52,059



78,653Related parties payables


111,500



111,500Royalty and license fee payable


135,000



135,000Total Current Liabilities


664,613



587,240TOTAL LIABILITIES


664,613



587,240STOCKHOLDERS' DEFICITPreferred stock, 50,000,000 shares authorizedat par value of $0.001, no sharesissued and outstanding






-Common stock, 200,000,000 shares authorized at parvalue of $0.001; 88,841,833 and 9,223,822 sharesissued and outstanding, respectively


88,767



9,224Stock subscription receivable






(17,000
)Additional paid-in capital


22,228,795



13,888,388Accumulated deficit


(22,966,852
)


(14,355,874
)Total Stockholders' Deficit


(649,290
)


(475,262
)TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIT

$
15,323


$
111,978




The accompanying notes are an integral part of these financial statements
  15
  FORMCAP CORP.





Statements of Operations for the years ended December 31, 2014 and 2013




For the Year ended

December 31,2014


2013REVENUES

$
-


$
-COST OF SALES


-



-GROSS MARGIN


-



-OPERATING EXPENSESConsulting fees


64,950



14,022Loss on impairment of oil & gas properties


(516,802
)


-General and administrative expenses


50,820



98,181Total Operating Expenses


632,572



112,203LOSS FROM OPERATIONS


(632,572
)


(112,203
)OTHER INCOME AND (EXPENSE)Interest expense


-



(10
)Loss on settlement of debt


(7,978,406
)


(2,274,000
)Total Other Income and (Expense)


(7,978,406
)


(2,274,010
)INCOME (LOSS) BEFORE INCOME TAXES PROVISION FOR INCOME TAXES


(8,610,978
)


(2,386,213
)NET INCOME (LOSS)

$
(8,610,978
)

$
(2,386,213
)BASIC AND DILUTED NET INCOME (LOSS) PER COMMON SHARE

$
(0.29
)

$
(0.05
)WEIGHTED AVERAGE NUMBER OF SHARES IN ISSUE


29,510,359



9,223,822




The accompanying notes are an integral part of these financial statements




16




FORMCAP CORP.


Statement of Stockholders’ Deficit for the years ended December 31, 2014 and 2013




Preferred


Common


Stock Subscription Receivable


Additional Paid-In  Capital


Deficit Accumulated During the Development Stage


Total Stockholder (Deficit)Shares


$


Shares


$


$


$


$


$Balance, December 31, 2012


-



-



203,824



204



(17,000)



11,178,408



(11,969,661)



(808,049
)Shares issued in settlement of Debt


-



-



9,000,000



9,000



-



2,690,000



-



2,699,000Shares issued pursuant to the acquisition of  oil and gas lease rights


-



-



20,000



20



-



19,980



-



20,000Net loss for the twelve months ended December 31, 2013


-



-



-



-



-



-



(2,386,213)



(2,386,213
)Balance, December 31, 2013


-



-



9,223,824



9,224



(17,000)



13,888,388



(14,355,874)



(475,262
)Shares issued pursuant to a financing transaction


-



-



1,000,000



1,000



-



2,309,000



-



2,310,000Rounding shares issued to shareholders


-



-



43,009



43



-



(43
)


-



-Shares issued pursuant to an consulting agreement


-



-



500,000



500



-



54,450



-



54,950Shares issued pursuant to a debt settlement agreement


-



-



50,000,000



50,000



-



5,445,000



-



5,495,000Shares issued pursuant to a debt settlement agreement


-



-



28,000,000



28,000



-



532,000



-



28,000Write off of uncollected subscription receivable


-



-



-



-



17,000



-



-



17,000Net loss for the twelve months ended December 31, 2014


-



-



-



-



-



-



(8,610,978)



(8,593,978
)Balance, December 31, 2014


-



-



88,841,833



88,767



-



22,228,795



(22,966,852)



(649,290
)




The accompanying notes are an integral part of these financial statements




17




FORMCAP CORP.


Statements of Cash Flows for the years ended December 31, 2014 and 2013




For the Year EndedDecember 31,2014


2013CASH FLOWS FROM OPERATING ACTIVITIESNet (Loss) Income

$
(8,610,978
)

$
(2,386,213
)Adjustments to reconcile net loss to net cash used by operating activities:Common stock and options issued for services


54,950



-Expenses paid
 on behalf of the Company


32,800



-Loss on impairment of assets


516,802



-Loss on settlement of debt


7,978,406



2,274,000Changes to operating assets and liabilities:Prepaid expenses and other current assets


(6,875
)


-Accounts payable and accrued liabilities


36,167



43,353Notes Receivable


(1,096
)


(9,266
)Net Cash Used in Operating Activities


2,368



(78,126
)CASH FLOWS FROM INVESTING ACTIVITIESPurchase of oil and gas lease


-



(6,802
)Net Cash Used in Investing Activities


-



(6,802
)CASH FLOWS FROM FINANCING ACTIVITIESProceeds from related party payables


-



15,000Proceeds from convertible notes payable






70,790Repayment of convertible notes payable


(3,000
)


-Net Cash Provided by Financing Activities


(3,000
)


85,790NET INCREASE (DECREASE) IN CASH


(632
)


862CASH AT BEGINNING OF PERIOD


910



48CASH AT END OF PERIOD

$
278


$
910CASH PAID FOR:Interest

$
-


$
10NON CASH FINANCING ACTIVITIES:Stock issued for oil and gas lease

$
2,310,000


$
672,000Stock Subscription Receivable

$
734,000


$
367,000Changes to Debt due to management change

$
49,000


$
49,000Changes to Equity from Reverse Stock Split

$
92,057


$
92,057Extinguishment of notes and convertible notes payable

$
560,000


$
88,594Extinguishment of AP

$
5,495,075


$
17,500Notes payable issued for Oil and Gas Lease and other expenses

$
142,800


$
110,000




The accompanying notes are an integral part of these financial statements




18




FORMCAP CORP.
 Notes to the Financial Statements December 31, 2014 and 2013





NOTE 1 – ORGANIZATION AND DESCRIPTION OF BUSINESS





FormCap Corp. (the “Company” or “FormCap”) was incorporated in the State of Florida on April 10, 1991, under the name of Aarden-Bryn Enterprises, Inc. The Company became a foreign registrant in the State of Nevada on December 24, 1998, and became qualified to transact business in the State of Nevada.





Since its incorporation, the Company has changed its name several times. On August 27, 1998 the Company changed its name to Corbett’s Cool Clear WTAA, Inc., on September 24, 1999 to WTAA International, Inc., on December 6, 2001 to Gravitas International, Inc., and finally to its current name, FormCap Corp. on October 12, 2007.





On September 18, 2007, the Company merged the Florida jurisdiction and the Nevada jurisdiction into one Nevada jurisdiction.





NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES





Basis of Presentation


These financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America and are stated in US dollars. Because a precise determination of many assets and liabilities is dependent upon future events, the preparation of financial statements for a period necessarily involves the use of estimates which have been made using careful judgment. Actual results may differ from these estimates.




Use of Estimates


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




Basic Earnings (Loss) Per Share


Basic earnings (loss) per share is calculated by dividing the Company’s net loss applicable to common shareholders by the weighted average number of common shares during the period. Diluted earnings per share is calculated by dividing the Company’s net income available to common shareholders by the diluted weighted average number of shares outstanding during the year. The diluted weighted average number of shares outstanding is the basic weighted number of shares adjusted for any potentially dilutive debt or equity. There were
 no shares issuable for covering debt or potentially dilutive instruments outstanding as of December 31, 2014 and 2013.





Stock Issued in Exchange for Services


The valuation of common stock issued in exchange for services is valued at an estimated fair market value as determined by the most readily determinable value of either the stock or services exchanged. Values of the stock are based upon other sales and issuances of the Company’s common stock within the same general time period.





Cash and Cash Equivalents


Cash equivalents are comprised of certain highly liquid investments with original maturities of three months or less when purchased. The Company maintains its cash in bank deposit accounts which at times may exceed federally insured limits of $250,000. The Company has not experienced any losses related to this concentration of risk. Deposits did not exceed insured limits during the years ended December 31, 2014 and 2013.




19





FORMCAP CORP.
 Notes to the Financial Statements December 31, 2014 and 2013




NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)





Financial Instruments


For accounts receivable, accounts payable, accrued liabilities, current portion of long-term debt and long-term debt, the carrying amounts of these financial instruments approximates their fair value. Unless otherwise noted, it is management’s opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments.





Foreign Currency Translation


The Company translates foreign currency transactions and balances to its reporting currency, United States Dollars, in accordance with ASC 830 “Foreign Currency Matters”. Monetary assets and liabilities are translated into the functional currency at the exchange rate in effect at the end of the year. Non-monetary assets and liabilities are translated at the exchange rate prevailing when the assets were acquired or the liabilities assumed. Revenue and expenses are translated at the rate approximating the rate of exchange on the transaction date. All exchange gains and losses are included in the determination of net income (loss) for the year.




Crude
                                         oil and natural gas properties  The Company uses the successful efforts
method of accounting for crude oil and natural gas properties whereby costs incurred to acquire mineral interests in crude oil
and natural gas properties, to drill and equip exploratory wells that find proved reserves, to drill and equip development wells,
and expenditures for enhanced recovery operations are capitalized. Geological and geophysical costs, seismic costs incurred for
exploratory projects, lease rentals and costs associated with unsuccessful exploratory wells or projects are expensed as incurred.
Costs of seismic studies that are utilized in development drilling within an area of proved reserves are capitalized as development
costs. To the extent a seismic project covers areas of both developmental and exploratory drilling, those seismic costs are proportionately
allocated between capitalized development costs and exploration expense. Maintenance, repairs and costs of injection are expensed
as incurred, except that the costs of replacements or renewals that expand capacity or improve production are capitalized.  Under the successful efforts method
of accounting, the Company capitalizes exploratory drilling, equipping and facility costs on the balance sheet pending determination
of whether the project has found proved reserves in economically producible quantities. The Company capitalizes costs associated
with the acquisition or construction of support equipment and facilities with the drilling and development costs to which they
relate. If proved reserves are assigned to a project, the associated capitalized costs become part of well equipment and facilities.
However, if proved reserves are not found in a project, the capitalized costs associated with the project are expensed, net of
any salvage value. Total capitalized costs pending the determination of proved reserves were $0 and $101,802 at December 31, 2014
and December 31, 2013, respectively.





Income Taxes


The Company applies ASC 740, which requires the asset and liability method of accounting for income taxes. The asset and liability method requires that the current or deferred tax consequences of all events recognized in the financial statements are measured by applying the provisions of enacted tax laws to determine the amount of taxes payable or refundable currently or in future years. Deferred tax assets are reviewed for recoverability and the Company records a valuation allowance to reduce its deferred tax assets when it is more likely than not that all or some portion of the deferred tax assets will not be recovered.





The Company adopted ASC 740, at the beginning of fiscal year 2008. This interpretation requires recognition and measurement of uncertain tax positions using a “more-likely-than-not” approach, requiring the recognition and measurement of uncertain tax positions. The adoption of ASC 740 had no material impact on the Company’s financial statements.




Recently Adopted Accounting Standards





In June 2014, the FASB issued ASU 2014-10, “Development Stage Entities (Topic 915): Elimination of Certain Financial Reporting Requirements, Including an Amendment to Variable Interest Entities Guidance in Topic 810, Consolidation”. The guidance eliminates the definition of a development stage entity thereby removing the incremental financial reporting requirements from U.S. GAAP for development or exploration stage entities, primarily presentation of inception to date financial information. The provisions of the amendments are effective for annual reporting periods beginning after December 15, 2014, and the interim periods therein. However, early adoption is permitted. Accordingly, the Company has adopted this standard as of September 30, 2014.





NOTE 3 – GOING CONCERN





The Company's financial statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern which contemplates the realization of assets and liquidation of liabilities in the normal course of business. The Company has not yet established an ongoing source of revenues sufficient to cover its operating costs and allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the Company obtaining adequate capital to fund operating losses until it becomes profitable. If the Company is unable to obtain adequate capital, it could be forced to cease operations.





In order to continue as a going concern, the Company will need, among other things, additional capital resources. Management's plan is to obtain such resources for the Company by obtaining capital from management and significant shareholders sufficient to meet its minimal operating expenses and seeking equity and/or debt financing. However management cannot provide any assurances that the Company will be successful in accomplishing any of its plans.





The ability of the Company to continue as a going concern is dependent upon its ability to successfully accomplish the plans described in the preceding paragraph and eventually secure other sources of financing and attain profitable operations. The accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.




20




FORMCAP CORP.
 Notes to the Financial Statements December 31, 2014 and 2013


NOTE 4 – PROMISSORY NOTE RECEIVABLE
 - RELATED PARTY





On
June 3, 2013 the Company advanced the sum of $11,194 ($11,500 Canadian Dollars) to  a related Canadian company. The loan is
secured by a promissory note and is due on December 31, 2014. During the year the Borrower repaid $1,097 leaving a balance of
$8,169 as of December 31, 2014.





The promissory note is non-interest bearing until maturity and bears interest at 3% per annum thereafter. The Promissory note will become due and payable if the company receives financing totalling $5,000,000 in aggregate prior to the maturity date. The promissory note is convertible into common shares of the company either in whole or in part at the option of the Company on terms to be determined by the borrowing company.





NOTE 5 – EXPLORATION PROPERTY LEASE





On November 19, 2013 the Company executed a Definitive Agreement with Kerr Energy Group and Keta Oil & Gas LLC (Kerr and Keta) both incorporated in Kansas.





Pursuant to the terms of the Agreement the Company agreed to acquire up to 2,400 acres in Cowley County, Kansas at a cost not exceed $200 per acre. In addition, the Company agreed to issue Kerr and Keta a total of 200,000 Rule 144 shares of the common stock of FormCap.





The Company acquired 100% of the Leases (80% net revenue to FormCap; 20% freehold royalty), and will be the operator. The Company will have the option to purchase additional leases in Cowley County from Kerr and Keta in an Area of Mutual Interest, the terms of which are set forth in the Agreement. FormCap is required to drill one test well in each of the first two years of the lease term in order to maintain its interest in the Leases.




During January 2014, Ironridge Global IV, Ltd. ("Ironridge") purchased from Kerr and Keta the Company’s obligation in the aggregate amount of
 $671,939 (the "Claim Amount"). Subsequently, the Company offered to settle the Claim Amount by the issuance of unrestricted and fully tradable shares of the Company's common stock. Ironridge accepted the Company's settlement offer, subject to a hearing on the fairness of the settlement terms. On February 21, 2014, the Company, Ironridge and the CEO of the Company entered into a Stipulation Order for the settlement on the terms agreed on by Ironridge and the Company. On February 21, 2014, a California Superior Court for the County of Los Angeles (the "State Court") held a hearing on the fairness of the Company's settlement offer to Ironridge. Pursuant to the court order issued by the State Court on February 21, 2014, the shares of the Company's common stock will be deemed issued in settlement of the claims (subject to certain adjustments based on the future trading value of the stock) when delivered to Ironridge. On February 24, 2014 the Company's transfer agent delivered to Ironridge 10,000,000 shares of the Company's common stock. The shares issued to Ironridge were freely tradable and exempt from registration under the Securities Act of 1933 and the California Corporations Code. The number of shares to be issued to Ironridge was subject to adjustment based trading price of the Company's stock such that the value of the shares is sufficient to cover the Claim Amount, a 10% agent fee amount and Ironridge's reasonable legal fees and expenses ( the "Final Amount"). Under the Stipulation Order, Ironridge could not be the beneficial owner of more than 9.99% of the Company's outstanding shares of common stock until the Final Amount is paid. Further Ironridge agreed not to exercise any voting rights of the shares issued to it nor influence or cause any change in control of the Company.





On
March 11, 2014 Ironridge paid Kerr and Keta $305,000 in full and final settlement of all monies due in connection with the
acquisition of 2,400 acres of the Cowley leases. Ironridge was obligated to provide $367,000 to the Company to fund the
drilling of two test wells on the Cowley lands within 90 days of the issuance of the shares of Common stock. On May 24, 2014,
Ironridge defaulted upon its obligation to fund the two test wells and on July 3, 2014, Ironridge was deregistered.
Accordingly, the Company recorded loss on receivable of $367,000 that Ironridge had pledged to pay towards drilling
expenses.





As at December 31, 2014 the Company had capitalized $516,802 toward the acquisition of the Cowley Leases. (December 31, 2013 - $101,802) The Company conducted an impairment test of the Cowley Leases as at December 31, 2014 and determined that the leases were impaired. Accordingly, the Company recorded a charge
 of this part of the $516,802 against the Leases.




21




FORMCAP CORP.
 Notes to the Financial Statements December 31, 2014 and 2013


NOTE 6 – CONVERTIBLE PROMISSORY NOTES PAYABLE – RELATED PARTIES





On January 2, 2014, a related party paid Kerr and Keta a further $50,000 in connection with the acquisition of the Cowley leases. On that date the Company issued a promissory note in the amount of $50,000 to the related party. The note matures on December 31, 2015.





On May 19, 2014 a related party paid certain creditors $7,000. On that date the Company issued a promissory note in the amount of $7,000 to the related party. The note matures on December 31, 2015.





On July 28, 2014 the Company issued a promissory note in the amount of $5,000 to a related party. The note matures on December 31, 2015.





On August 11, 2014 a related party paid a certain creditor $2,500. On that date the Company issued a promissory note in the amount of $2,500 to the related party. The note matures on December 31, 2015.





As at December 31, 2014, the Company owed $113,490 to related party holders of Convertible Promissory Notes (December 31, 2013 - $48,990)





The Promissory notes are non-interest bearing until maturity and bear interest at 3% per annum thereafter. The Promissory notes will become due and payable if the Company receives financing totalling $5,000,000 in aggregate prior to the maturity date. The promissory notes are convertible into common shares of the Company either in whole or in part at the option of the Holders on terms to be determined by the Company.





NOTE 7 – CONVERTIBLE PROMISSORY NOTES PAYABLE




During April and May, 2013 the Company issued convertible promissory notes in the amounts of $15,000 to two unrelated third parties. The notes mature on December 31, 2014





On June 3, 2013, the Company issued promissory notes in the amounts of $20,000 Canadian Dollars in favour an unrelated third party. The notes mature on December 31, 2015





On July 30, 2013 the Company issued a promissory note in the amount $5,000 Dollars in favour an unrelated third party. The note matures on December 31, 2015





On August 9, 2013 the Company issued a promissory note in the amount of $3,000 in favour an unrelated third party. The note matures on December 31, 2015





On September 30, 2013 the Company issued a promissory note in the amount of $25,000 to an unrelated third party. The note matures on December 31, 2015





On November 8, 2013 the Company issued a promissory note in the amount of $7,500 to a related third party. The note matures on December 31, 2015





On November 6, 2013 the Company issued a promissory note in the amount of $3,000 to a unrelated third party. The note matures on December 31, 2015





On November 19, 2013 the Company issued a promissory note in the amount of $7,500 to a unrelated third party. The note matures on December 31, 2015





On December 16, 2013, an unrelated third party paid $50,000 to Kerr and Keta in connection with the acquisition of the Cowley leases. On that date the Company issued a promissory note in the amount of $50,000 to the unrelated third party. The note matures on December 31, 2015.




22




FORMCAP CORP.
 Notes to the Financial Statements December 31, 2014 and 2013


On December 24, 2013 the Company issued a promissory note in the amount of $24,800 to an unrelated third party. The note matures on December 31, 2015.




On January 23, 2014, an unrelated third party paid Kerr and Keta a further $50,000 in connection with the acquisition of the Cowley leases. On that date the Company issued a promissory note in the amount of $50,000 to the unrelated third party. The note matures on December 31, 2015.





On February 28, 2014 the Company issued a promissory note in the amount of $11,000 to an unrelated party. The note matures on December 31, 2015.





On April 15, 2014 an unrelated party paid a certain creditor $10,000. On that date the Company issued a promissory note in the amount of $10,000 to the related party. The note matures on December 31, 2015.





On April 15, 2014 the Company repaid $3,000 against a promissory note issued to an unrelated party.





On December 3, 2014 the Company issued a promissory note in the amount of $7,300 to an unrelated party. The note matures on December 31, 2015.





On December 4, 2014 the Company entered into an Assignment of Creditor and Settlement of Debt agreement with a holder of multiple convertible promissory notes in the amount of $62,000. The Company issued 28,000,000 common shares in connection with this transaction





As at December 31, 2014, the Company owed $128,100 to the holders of the Convertible Promissory notes (December 31, 2013 - $111,800)





The promissory notes are non-interest bearing until maturity and bear interest at 3% per annum thereafter. The Promissory notes will become due and payable if the Company receives financing totaling $5,000,000 in aggregate prior to the maturity date. The promissory notes are convertible into common shares of the Company either in whole or in part at the option of the holders on terms to be determined by the Company.





NOTE 8 – RELATED PARTY TRANSACTIONS





The Company from time to time has borrowed funds from or has received services from several related parties for operating purposes.





On August 27, 2014, the Company entered in a debt settlement agreement with a related party. The Company agreed to settle a debt of $10,000 by the issuance of 50,000,000 shares of common stock with a fair value of $5,495,000. The Company recorded a loss of $5,485,000 on this transaction.





As of December 31, 2014 the Company owed related parties $111,500 (December 31, 2013 - $111,500). These amounts bear no interest, are not collateralized, and are due on demand.





NOTE 9 – NOTES PAYABLE




On December 4, 2014 the Company entered into an Assignment of Creditor and Settlement of Debt agreement with a holder of notes payable in the amount of $26,594. The Company issued 28,000,000 shares of Common Stock in connection with this transaction





The balance owed to these parties as of December 31, 2013 was $49,059 (December 31, 2012 - $78,653). These amounts bear no interest, are not collateralized, and are due on demand.





NOTE 10 – COMMON STOCK





The Company has two classes of stock authorized as of December 31, 2014. The Company has 50,000,000 shares of preferred stock authorized with no shares outstanding as of December 31, 2014 and 2013. The Company also has 200,000,000 shares of common stock authorized with 88,841,833 shares issued and outstanding as of December 31, 2014 (December 31, 2013 – 9,223,822).




23




FORMCAP CORP.
 Notes to the Financial Statements December 31, 2014 and 2013


On July 31, 2014, the Company effected a 1 for 10 reverse stock split. All references in these financial statements to number of common shares issued and outstanding, price per share and weighted average number of common shares have been adjusted to reflect the stock split on a retroactive basis, unless otherwise noted. The Company’s authorized preferred stock and authorized common stock remain unchanged.





On February 24, 2014, the Company issued 1,000,000 shares of common stock in connection with the purchase of the Cowley leases which were valued at $2,310,000. The Company recognized a loss of $2,005,000 on this transaction.





On August 27, 2014, the Company entered in to a contract for financial consulting and advisory services for a six month term, expiring on January 27, 2015. The Company agreed to issue 500,000 restricted shares as compensation to the consultants which were valued using fair market value of the stock price on that date for a total compensation expense of $54,950.





On August 27, 2014, the Company entered in a debt settlement agreement with a related party. The Company agreed to settle a debt of $10,000 by the issuance of 50,000,000 shares of common stock with a fair value of $5,495,000. The Company recorded a loss of $5,485,000 on this transaction.





On
September 3, 2014, the Company entered into an escrow agreement with a creditor. The Company agreed to pay the creditor
$2,500 upon the signing of the agreement and to issue 75,000 shares to be held in escrow. The Company is obligated to pay the
creditor a further $7,514 forty five days after the Company’s stock becomes DWAC-eligible. Upon payment of the final
amount owing the shares will be returned to the Company. The company has not yet paid the creditor and the shares remain in escrow.


On December 4, 2014, the Company entered in an Assignment of Creditors and Settlement of Debt agreement. The Company agreed to settle Convertible Promissory Notes Payable in the amount of $62,000 and Notes Payable in the amount of $26,594 by the issuance of 28,000,000 shares of common stock valued at $532,000. The Company recorded a loss of $471,406 on this transaction.


During 2014, the company determined that the $17,00 subscription receivable for shares issued in 2007 was uncollectible.
 The resulting write-off of this amount has been recorded in loss on settlement of debt.


NOTE 11 –INCOME TAXES





Income Taxes


The Company accounts for income taxes in accordance with Accounting Standards Codification Topic 740, Income Taxes ("Topic 740"), which requires the recognition of deferred tax liabilities and assets at currently enacted tax rates for the expected future tax consequences of events that have been included in the financial statements or tax returns. A valuation allowance is recognized to reduce the net deferred tax asset to an amount that is more likely than not to be realized.





Topic 740 provides guidance on the accounting for uncertainty in income taxes recognized in a company's financial statements. Topic 740 requires a company to determine whether it is more likely than not that a tax position will be sustained upon examination based upon the technical merits of the position. If the more likely-than-not threshold is met, a company must measure the tax position to determine the amount to recognize in the financial statements.





Net deferred tax assets consist of the following components as of December 31, 2014 and 2013:





Deferred tax assets:

December 31,

2014


December 31,

2013Net operating loss carryover

$
(9,512,712
)

$
(6,584,979
)Common stock
 issued for services


582,395



563,712Common stock issued for settlement of debt


45,900



45,900Loss on extinguishment of debt


5,334,640



1,848,822Impairment of assets


599,423



423,710Amortization of beneficial conversion feature


258,373



258,373Valuation allowance


2,291,981



2,671,302Income tax expense per books

$
(-
)

$
(-
)





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FORMCAP CORP.
 Notes to the Financial Statements December 31, 2014 and 2013




The income tax provision differs from the amount of income tax determined by applying the estimated U.S. federal and state income tax rates of 39% to pretax income from continuing operations for the year ended December 31, 2014 and 2013 due to the following:





December 31,

2014


December 31,

2013Income tax expense at statutory rate

$
(40,520
)

$
(37,210
)Common stock and warrants issued for servicesLoss on extinguishment of debtImpairment of assetsAmortization of beneficial conversion feature(Gain) Loss on extinguishment of debtValuation allowance






37,210Income tax expense per books

$
(40,520
)

$
-





As at December 31, 2014, the Company had net operating loss carry forwards of approximately
 $7,808,730 through 2034. No tax benefit has been reported in the December 31,
 2014 financial statements as the potential tax benefit is offset by a valuation allowance of the same amount.





Due to the change in ownership provisions of the Tax Reform Act of 1986, net operating loss carry forwards for Federal income tax reporting purposes are subject to annual limitations. Should a change in ownership occur, net operating loss carry forwards may be limited as to use in future years.





NOTE 12 – SUBSEQUENT EVENTS





In accordance with ASC 855-10 Company management reviewed all material events through the date of this report. The Company has determined that there are no items to disclose.




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(b)  Exhibits




31.1

Certification of the Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.31.2

Certification of the Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.32.1

Certification of the Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.32.2

Certification of the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.




26





SIGNATURES





In accordance with 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.






FORMCAP CORP.Dated: April 15, 2015
By:
/s/ Bradley MoynesBradley MoynesPresident, Secretary, Treasurer & Director.
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