SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C.  20549





FORM
10-Q





ý
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF


THE
SECURITIES EXCHANGE ACT OF 1934





For
Quarterly Period Ended December 31, 2009





or





o
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF


THE
SECURITIES EXCHANGE ACT OF 1934





For
the transition period from
         
to





Commission
File Number 0-21555





AMASYS
CORPORATION


(Exact
name of registrant issuer as specified in its charter)





Delaware
            
            54-1812385(State
      or other jurisdiction of incorporation or
              organization)
            
            (I.R.S.
      Employer Identification No.)625
      N. Washington Street, Suite 301,
              Alexandria,
      Virginia 22314(Address
      of principal executive offices, including zip code)Registrant’s
      phone number, including area code    (703)
      797-8111





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 ý     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 (section 232.405 of
this chapter) during the preceding twelve months (or shorter period that the
registrant was required to submit and post such files).


YES o     NO
ý





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


Large
Accelerated Filer o
Accelerated Filer o
Non-accelerated Filer o Smaller reporting
company ý





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





Indicate
the number of shares outstanding of each of the issuer’s classes of common
stock, as of the latest practicable date.





Class
            
            Outstanding
      at February 11, 2010Common
      Stock, $.01 par value
            
            6,669,210














AMASYS
CORPORATION





INDEX





Page
      No.PART I
            FINANCIAL
      INFORMATIONITEM
      1.
            FINANCIAL
      STATEMENTS:Balance
      Sheets — December 31, 2009 (Unaudited) and June 30, 2009
            3Statements
      of  Operations (Unaudited) — Three and six months ended December
      31, 2009 and 2008 and the period from entering development stage (October
      1, 2006) through December 31, 2009
            4Statements
      of Cash Flows (Unaudited) — Six months ended December 31, 2009 and 2008
      and the period from entering development stage (October 1, 2006) through
      December 31, 2009
            5Notes
      to Financial Statements
            6-8ITEM
      2.
            MANAGEMENT'S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS
            9-12ITEM
      3.
            QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
            13ITEM
      4T.
            CONTROLS
      AND PROCEDURES
            13PART
      II
            OTHER
      INFORMATION
            13




















-
2 -











PART I -
FINANCIAL INFORMATION





ITEM
I — FINANCIAL STATEMENTS





AMASYS
CORPORATION


(A
Development Stage Company)


BALANCE
SHEETS





December
      31,
            
            June
      30,2009
            
            2009ASSETS
            (Unaudited)CURRENT
      ASSETSCash
            
            $
            518
            
            
            $
            348TOTAL
      CURRENT ASSETS
            
            
            518
            
            
            
            348TOTAL
      ASSETS
            
            $
            518
            
            
            $
            348LIABILITIES AND STOCKHOLDERS’
      DEFICITCURRENT
      LIABILITIES:Accounts
      payable and accrued expenses
            
            $
            21,099
            
            
            $
            17,500Accounts
      payable, related parties
            
            
            24,500
            
            
            
            23,500Notes
      payable and accrued interest, related parties
            
            
            173,893
            
            
            
            145,539TOTAL
      CURRENT LIABILITIES
            
            
            219,492
            
            
            
            186,539STOCKHOLDERS’
      DEFICIT:Preferred
      stock, $.01 par value, 1,000,000 shares authorized, no shares issued and
      outstanding at December 31, 2009 and June 30, 2009,
      respectively
            
            
            -
            
            
            
            -Common
      stock, $.01 par value, 20,000,000 shares authorized, 6,669,210 shares
      issued and outstanding at December 31, 2009 and June 30, 2009,
      respectively
            
            
            66,692
            
            
            
            66,692Additional
      paid in capital
            
            
            317,045
            
            
            
            317,045Accumulated
      deficit (including $238,949 accumulated during development
      stage)
            
            
            (602,711
            )
            
            
            (569,928
            )TOTAL
      STOCKHOLDERS’ DEFICIT
            
            
            (218,974
            )
            
            
            (186,191
            )TOTAL
      LIABILITIES AND STOCKHOLDERS’ DEFICIT
            
            $
            518
            
            
            $
            348














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





-
3 -


AMASYS
CORPORATION


(A
Development Stage Company)


STATEMENTS
OF OPERATIONS


(UNAUDITED)








Three
      Months Ended December 31,
            
            
            Six
      Months Ended December 31,
            
            
            Period
      from entering Development Stage (October 1, 2006) through December 31,2009
            
            
            2008
            
            
            2009
            
            
            2008
            
            
            2009REVENUES
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            -
            
            
            $
            -COST
      OF SALES
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -GROSS
      PROFIT
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -OPERATING
      EXPENSES:General
      and administrative expenses
            
            
            7,070
            
            
            
            55,624
            
            
            
            24,430
            
            
            
            86,463
            
            
            
            207,650Total
      operating expenses
            
            
            7,070
            
            
            
            55,624
            
            
            
            24,430
            
            
            
            86,463
            
            
            
            207,650LOSS
      FROM OPERATIONS
            
            
            (7,070
            )
            
            
            (55,624
            )
            
            
            (24,430
            )
            
            
            (86,463
            )
            
            
            (207,650
            )OTHER
      INCOME (EXPENSE):Interest
      expense
            
            
            (4,389
            )
            
            
            (2,963
            )
            
            
            (8,353
            )
            
            
            (4,648
            )
            
            
            (24,033
            )Loss
      on extinguishment of debt
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            (20,000
            )Gain
      on sale of short term investment
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            12,734Total
      other expense
            
            
            (4,389
            )
            
            
            (2,963
            )
            
            
            (8,353
            )
            
            
            (4,648
            )
            
            
            (31,299
            )LOSS
      BEFORE PROVISION FOR INCOME TAXES
            
            
            (11,459
            )
            
            
            (58,587
            )
            
            
            (32,783
            )
            
            
            (91,111
            )
            
            
            (238,949
            )Provision
      for income taxes
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -
            
            
            
            -NET
      LOSS APPLICABLE TO COMMON STOCKHOLDERS
            
            $
            (11,459
            )
            
            $
            (58,587
            )
            
            $
            (32,783
            )
            
            $
            (91,111
            )
            
            $
            (238,949
            )NET
      LOSS PER SHARE OF COMMON STOCK — Basic and diluted
            
            $
            (0.00
            )
            
            $
            (0.01
            )
            
            $
            (0.00
            )
            
            $
            (0.01
            )WEIGHTED
      AVERAGE SHARES OUTSTANDING — Basic and diluted
            
            
            6,669,210
            
            
            
            6,669,210
            
            
            
            6,669,210
            
            
            
            6,669,210














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


-
4 -


AMASYS
CORPORATION


(A
Development Stage Company)


STATEMENTS
OF CASH FLOWS


(UNAUDITED)


Period
      from entering Development Stage (October 1, 2006) through December 31,Six
      Months Ended December 31,2009
            
            2008
            
            
            2009CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
            
            $
            (32,783)
            
            $
            (91,111)
            
            $
            (238,949)Adjustments
      to reconcile net loss to net cash used in operating
      activities:Stock
      issued for loans
            
            
            -
            
            
            -
            
            
            20,000Gain
      on sale of short term investment
            
            
            -
            
            
            -
            
            
            (12,734)Changes
      in operating assets and liabilities;Accounts
      payable and accrued expenses
            
            
            11,953
            
            
            4,648
            
            
            17,910Accounts
      payable, related parties
            
            
            1,000
            
            
            22,000
            
            
            16,972Net
      cash used in operating activities
            
            
            (19,830)
            
            
            (64,463)
            
            
            (196,801)CASH
      FLOWS FROM INVESTING ACTIVITIES:Net
      proceeds from sale of short term investment
            
            
            -
            
            
            -
            
            
            40,570Net
      cash provided by investing activities
            
            
            -
            
            
            -
            
            
            40,570CASH
      FLOWS FROM FINANCING ACTIVITIES:Proceeds
      from sale of common stock
            
            
            -
            
            
            -
            
            
            3,500Proceeds
      from notes payable, related parties
            
            
            20,000
            
            
            65,000
            
            
            150,000Net
      cash provided by financing activities
            
            
            20,000
            
            
            65,000
            
            
            153,500NET
      INCREASE IN CASH
            
            
            170
            
            
            537
            
            
            (2,731)CASH,
      Beginning of period
            
            
            348
            
            
            698
            
            
            3,249CASH,
      End of period
            
            $
            518
            
            $
            1,235
            
            $
            518SUPPLEMENTAL
      DISCLOSURE OF CASH FLOW INFORMATION:Cash
      received/(paid) during the period for:Interest
            
            $
            -
            
            $
            -
            
            $
            -Income
      taxes
            
            $
            -
            
            $
            -
            
            $
            -





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


-
5 -


AMASYS
CORPORATION


(A
Development Stage Company)


NOTES
TO FINANCIAL STATEMENTS


(UNAUDITED)





NOTE
1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES





Basis of
Presentation — The accompanying financial statements have been prepared
in conformity with accounting principles generally accepted in the United States
of America.  All references to Generally Accepted Accounting
Principles (“GAAP”) are in accordance with The FASB Accounting Standards
Codification (“ASC”) and the Hierarchy of Generally Accepted Accounting
Principles.





The
unaudited financial statements have been prepared by us pursuant to the rules
and regulations of the Securities and Exchange Commission. The information
furnished herein reflects all adjustments (consisting of normal recurring
accruals and adjustments) which are, in the opinion of management, necessary to
fairly present the operating results for the respective periods. Certain
information and footnote disclosures normally present in annual financial
statements prepared in accordance with accounting principles generally accepted
in the United States of America have been omitted pursuant to such rules and
regulations. These financial statements should be read in conjunction with the
audited financial statements and footnotes for the year ended June 30, 2009
included in our Annual Report on Form 10-K. The results of the six month period
ended December 31, 2009 are not necessarily indicative of the results to be
expected for the full year ending June 30, 2010.





Going
Concern — The accompanying financial statements have been prepared
assuming that we will continue as a going concern.  We have suffered
recurring losses from operations since our inception and have an accumulated
deficit of $602,711 at December 31, 2009.  The financial statements do
not include any adjustments relating to the recoverability and classification of
recorded asset amounts or amounts and classifications of liabilities that might
be necessary should we be unable to continue our existence.





In
addition, our recovery is dependent upon future events, the outcome of which is
undetermined.  We intend to continue to attempt to raise additional
capital, but there can be no certainty that such efforts will be
successful.





Development Stage
Activities - Since we redeemed and converted all of the outstanding
Series A Preferred Stock of Comtex at the end of September 2006, starting
October 1, 2006 we have not conducted any business operations. All of our
operating results and cash flows reported in the accompanying financial
statements from October 1, 2006 are considered to be those related to
development stage activities and represent the cumulative amounts from its
development stage activities required to be reported.





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





Cash and Cash
Equivalents — We consider investments with original maturities of
90 days or less to be cash equivalents.





Income
Taxes — The Company accounts for income taxes in accordance with ASC
Topic 740.  Deferred tax assets and liabilities are recognized to reflect
the estimated future tax effects, calculated at currently effective tax rates,
of future deductible or taxable amounts attributable to events that have been
recognized on a cumulative basis in the financial statements. A valuation
allowance related to a deferred tax asset is recorded when it is more likely
than not that some portion of the deferred tax asset will not be
realized.





Stock-Based
Compensation — The Company accounts for stock based compensation in
accordance with ASC Topic 718.  ASC Topic 718 requires recognition of
the cost of employee services received in exchange for an award of equity
instruments in the financial statements over the period the employee is required
to perform the services in exchange for the award. Awards are measured at their
grant date fair value. Stock based compensation expense is to be recognized on
awards ultimately vested and expected to vest, therefore, the amount recognized
must be reduced for estimated forfeitures.  Forfeitures must be
estimated at the time of grant and revised, if necessary, in subsequent periods
if actual forfeitures differ from those original estimates.


-
6 -


Net Income (Loss)
Per Share — Basic net income (loss) and diluted loss per share is
calculated by dividing net income (loss) by the weighted-average number of
common shares outstanding during the period. Diluted net income per share is
calculated by dividing the net income by the weighted-average number of shares
and dilutive potential common shares outstanding during the period. Dilutive
potential shares consist of dilutive shares issuable upon the exercise of
outstanding stock options and warrants computed using the treasury stock
method.





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





Subsequent
Events - In
preparing the financial statements, the Company has reviewed, as determined
necessary by the Company’s management, events that have occurred after December
31, 2009, up until the issuance of the financial statements, which occurred on
February 11, 2010.





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





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





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





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





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





The
Company’s adoption of fair value measurements and disclosures did not have a
material impact on the financial statements and financial statement
disclosures.





Recent Accounting
Pronouncements -
Several new accounting pronouncements have been issued by the
FASB.  Each of these pronouncements, as applicable, has been or will
be adopted by the Company.  Management does not believe the adoption of any
of these accounting pronouncements has had or will have a material impact on the
Company’s financial position or operating results.





NOTE
2 – NOTE PAYABLE RELATED PARTIES





During
the year ended June 30, 2007, we received $10,000 from Private Capital Group,
L.L.C., a shareholder of the Company.  This note has an interest rate
of 10% per annum, is unsecured and had an original due date of December 31,
2007.  The note was extended with the same terms and a due date of
December 31, 2010.  As of December 31, 2009, accrued interest payable
totaled $2,606 and is due at maturity.  Accrued interest is included
in the notes payable, related parties balance.  As an inducement to
make the loan, we issued 1,000,000 shares of restricted common stock with a fair
market value of $10,000 (par value) and issued a warrant for an additional
1,000,000 shares of restricted common stock with an exercise price of $.01 per
share.  The warrants were estimated to have no significant fair market
value.





During
the year ended June 30, 2007, we received $10,000 from Dr. C.W. Gilluly, our
Chairman of the Board, President and Chief Executive Officer.  This
note has an interest rate of 10% per annum, is unsecured and had an original due
date of December 31, 2007.  The note was extended with the same terms
and a due date of December 31, 2010.  As of December 31, 2009, accrued
interest payable totaled $2,606 and is due at maturity.  Accrued
interest is included in the notes payable, related parties
balance.  As an inducement to make the loan, we issued 1,000,000
shares of restricted common stock with a fair market value of $10,000 (par
value) and issued a warrant for an additional 1,000,000 shares of restricted
common stock with an exercise price of $.01 per share.  The warrants
were estimated to have no significant fair market value.


-
7 -





During
the year ended June 30, 2008, we received an additional $15,000 from Dr. C.W.
Gilluly, our Chairman of the Board, President and Chief Executive
Officer.  This note has an interest rate of 12% per annum, is
unsecured and has a due date of December 31, 2010.  As of December 31,
2009, accrued interest payable totaled $3,831 and is due at
maturity.  Accrued interest is included in the notes payable, related
parties balance.





During
the year ended June 30, 2008, we received an additional $5,000 from Private
Capital Group, L.L.C., a shareholder of the Company.  This note has an
interest rate of 12% per annum, is unsecured and has a due date of December 31,
2010.  As of December 31, 2009, accrued interest payable totaled
$1,162 and is due at maturity.  Accrued interest is included in the
notes payable, related parties balance.





During
the year ended June 30, 2008, we received an additional $15,000 from Dr. C.W.
Gilluly, our Chairman of the Board, President and Chief Executive
Officer.  This note has an interest rate of 12% per annum, is
unsecured and has a due date of December 31, 2010.  As of December 31,
2009, accrued interest payable totaled $2,746 and is due at
maturity.  Accrued interest is included in the notes payable, related
parties balance.





During
the year ended June 30, 2009, we received an additional $25,000 from Dr. C.W.
Gilluly, our Chairman of the Board, President and Chief Executive
Officer.  This note has an interest rate of 12% per annum, is
unsecured and has a due date of December 31, 2010.  As of December 31,
2009, accrued interest payable totaled $3,877 and is due at
maturity.  Accrued interest is included in the notes payable, related
parties balance.





During
the year ended June 30, 2009, we received an additional $40,000 from Dr. C.W.
Gilluly, our Chairman of the Board, President and Chief Executive
Officer.  This note has an interest rate of 12% per annum, is
unsecured and has a due date of December 31, 2010.  As of December 31,
2009, accrued interest payable totaled $5,444 and is due at
maturity.  Accrued interest is included in the notes payable, related
parties balance.





During
the year ended June 30, 2009, we received an additional $10,000 from Dr. C.W.
Gilluly, our Chairman of the Board, President and Chief Executive
Officer.  This note has an interest rate of 12% per annum, is
unsecured and has a due date of December 31, 2010.  As of December 31,
2009, accrued interest payable totaled $930 and is due at
maturity.  Accrued interest is included in the notes payable, related
parties balance.





During
the quarter ended September 30, 2009, we received an additional $15,000 from Dr.
C.W. Gilluly, our Chairman of the Board, President and Chief Executive
Officer.  This note has an interest rate of 12% per annum, is
unsecured and has a due date of December 31, 2010.  As of December 31,
2009, accrued interest payable totaled $582 and is due at
maturity.  Accrued interest is included in the notes payable, related
parties balance.





During
the quarter ended December 31, 2009, we received an additional $5,000 from Dr.
C.W. Gilluly, our Chairman of the Board, President and Chief Executive
Officer.  This note has an interest rate of 12% per annum, is
unsecured and has a due date of December 31, 2010.  As of December 31,
2009, accrued interest payable totaled $109 and is due at
maturity.  Accrued interest is included in the notes payable, related
parties balance.





NOTE
3 – STOCK WARRANTS





During
the year ended June 30, 2007, we issued two warrants as part of an incentive for
two notes payable, related parties.  The warrants are for the purchase
of 2,000,000 shares of restricted common stock at an exercise price of
$.01.  The warrants have a fair market value of $-0- using the Black
Scholes method of calculation and the warrants expire in 2017.





NOTE
4 – SUBSEQUENT EVENTS





On
January 22, 2010 the Company executed a $5,000 note with C.W. Gilluly, pursuant
to which C.W. Gilluly advanced us $5,000 at a rate of 12% per annum. The note is
unsecured and has a due date of December 31, 2010.





-
8 -


ITEM 2.  MANAGEMENT’S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS





The
information contained in this Form 10-Q is intended to update the information
contained in our Annual Report on Form 10-K for the year ended June 30, 2009 and
presumes that readers have access to, and will have read, the “Management’s
Discussion and Analysis of Financial Condition and Results of Operations” and
other information contained in such Form 10-K.  The following
discussion and analysis also should be read together with our financial
statements and the notes to the financial statements included elsewhere in this
Form 10-Q.





The
following discussion contains certain statements that may be deemed
“forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995.  Such statements appear in a number of
places in this Report, including, without limitation, “Management’s Discussion
and Analysis of Financial Condition and Results of Operations.”  These
statements are not guarantees of future performance and involve risks,
uncertainties and requirements that are difficult to predict or are beyond our
control.  Forward-looking statements speak only as of the date of this
quarterly report. You should not put undue reliance on any forward-looking
statements.  We strongly encourage investors to carefully read the
factors described in our Annual Report on Form 10-K for the year ended June 30,
2009 in the section entitled “Risk Factors” for a description of certain risks
that could, among other things, cause actual results to differ from these
forward-looking statements. We assume no responsibility to update the
forward-looking statements contained in this quarterly report on Form 10-Q. The
following should also be read in conjunction with the unaudited Financial
Statements and notes thereto that appear elsewhere in this report.





Company
History





AMASYS
Corporation (“AMASYS”, the “Company,” us, we or our) 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 December 31, 2006 AMASYS no longer had an equity
interest in Comtex and no longer had an equity interest in Analex.





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





ASC Topic
815 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.





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.





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9 -


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





For the Three and Six Months
Ended December 31, 2009 and 2008





Results
of Operations





General
and Administrative Expenses





General
and administrative expenses were $7,070 and $55,624 for the three months ended
December 31, 2009 and 2008, respectively and $$24,430 and $86,463 for the six
months ended December 31, 2009 and 2008, respectively.  The decrease
in general and administrative expenses for the periods stated above was mainly
due to the reduction in professional fees associated with audit and accounting
fees for our various SEC filings.





Other
Income (Expense)





Other
income (expense) was $(4,389) and $(2,963) for the three months ended December
31, 2009 and 2008, respectively, and $(8353) and $(4,648) for the six months
ended December 31, 2009 and 2008, respectively.  The increase for the
periods stated above is due to the additional interest expense incurred on our
additional notes payable, related parties.





Liquidity
and Capital Resources





Net cash used in
operating activities was $19,830 and $64,463 in the six months ended December
31, 2009 and 2008, respectively.  The decrease was primarily due to
the reduction in our net loss for the six months ended December 31, 2009
compared to 2008 and the increase in our accounts payable and accrued
expenses.





Net cash
provided by investing activities was $-0- and $-0- in the six months ended
December 31, 2009 and 2008, respectively.





Net cash
provided by financing activities was $20,000 and $65,000 in the six months ended
December 31, 2009 and 2008, respectively.  The decrease in cash
provided by financing activities was due to the reduction in proceeds from notes
payable, related parties.





We
suffered recurring losses from operations and have an accumulated deficit of
$602,711 at December 31, 2009.  Currently, we are a non-operating
public company. We seek suitable candidates for a business combination with a
private company.  In the event we use all of our cash resources, C.W.
Gilluly has indicated the willingness to loan us funds at the prevailing market
rate, assuming we find a suitable candidate for a business combination, until
such business combination is consummated.  Even though this is Mr.
Gilluly's current intention, he has made no firm commitment and it is at his
sole discretion whether or not to fund us.  In the event Mr. Gilluly
does not fund us, we will not have the funds necessary to operate and will have
to dissolve.





Inflation and
Seasonality





Inflation
has not been material to us during the past five years. Seasonality has not been
material to us.








Off-Balance Sheet
Arrangements





We have
no off-balance sheet arrangements.





Risk
Factors





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


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10 -





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





We have a
history of incurring losses from operations. As of December 31, 2009, we had an
accumulated deficit of $602,711.  We are currently funding our
operations through loans. Our ability to continue may prove more expensive than
we currently anticipate and we may incur significant additional costs and
expenses.





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





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





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





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





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





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





Our auditors have expressed a going
concern opinion .





Primarily
as a result of our recurring losses and our lack of liquidity, we received a
report from our independent auditors that includes an explanatory paragraph
describing the substantial uncertainty as to our ability to continue as a going
concern for the year ended June 30, 2009.





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





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





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





The
market price of our stock is likely to be highly volatile because there has been
a relatively thin trading market for our stock, which causes trades of small
blocks of stock to have a significant impact on our stock price. You may not be
able to resell our common stock following periods of volatility because of the
market's adverse reaction to volatility.Other factors that could
cause such volatility may include, among other things are announcements
concerning our strategy, litigation and general market conditions.


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11 -


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





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





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





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


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12 -





ITEM
3 – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK





A smaller
reporting company is not required to provide the information required by
this Item.





ITEM
4T - CONTROLS AND PROCEDURES





EVALUATION OF DISCLOSURE CONTROLS AND
PROCEDURES.   Our management, with the participation of our
president and our chief financial officer, carried out an evaluation of the
effectiveness of our "disclosure controls and procedures" (as defined in
the Securities Exchange Act of 1934 (the "Exchange Act") Rules 13a-15(e)
and 15-d-15(e)) as of the end of the period covered by this report (the
"Evaluation Date"). Based upon that evaluation, our President and our
Chief Financial Officer concluded that, as of the Evaluation Date, our
disclosure controls and procedures are effective to ensure that information
required to be disclosed by us in the reports that we file or submit under
the Exchange Act (i) is recorded, processed, summarized and reported,
within the time periods specified in the SEC's rules and forms and (ii) is
accumulated and communicated to our management, including our President and
our Chief Financial Officer, as appropriate to allow timely decisions
regarding required disclosure.





CHANGES IN INTERNAL CONTROL OVER
FINANCIAL REPORTING.   There were no changes in our
internal controls over financial reporting that occurred during the
period covered by this report that has materially affected, or is
reasonably likely to materially affect, our internal control over financial
reporting.





PART
II - OTHER INFORMATION





ITEM
      6.
            
            Exhibits31
            Certification
      of President pursuant to Exchange Act Rule 13a-14 and 15d-14 as adopted
      pursuant to section 302 of the Sarbanes-Oxley Act of
  2002.32
            Certification
      of the Company’s Chief Executive Officer and Chief Financial Officer,
      pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002.


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13 -











SIGNATURES





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





AMASYS
      CORPORATIONDate:
      February 11, 2010
            /s/ 
      C.W. GillulyName:
      C.W. Gilluly, Ed.D.Title: President,
      Chief Executive Officer and Chief Financial Officer




















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14 -

















EXHIBIT
INDEX








Exhibit
            
            Description31
            
            Certification
      of President pursuant to Exchange Act Rule 13a-14 and 15d-14 as adopted
      pursuant to section 302 of the Sarbanes-Oxley Act of
  2002.32
            
            Certification
      of the Company’s Chief Executive Officer and Chief Financial Officer,
      pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002.