Quarterly Report (10-q)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

x QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2014

o TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission File Number : 000-28847

FORMCAP CORP.

( Exact name of registrant as specified in its charter )

Nevada		1006772219
( State or other jurisdiction of incorporation or organization )		( I.R.S. Empl. Ident. No. )

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

( Address of principal executive offices ) ( Zip Code )

775-285-5775

( Issuer's telephone number )

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Exchange Act during the past 12 months (or for such 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 o NO x

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 mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or a small reporting company. See definitions of "large accelerated filer,” “accelerated filer,” and “small reporting company" in Rule 12B-2 of the Exchange Act.

Large accelerated filer	o	Non-accelerated filer	o
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 ExchangeAct). YES o NO x

The number of shares outstanding the issuer’s common stock, $0.001 par value, was 10,229,346 as of August 13, 2014.

FormCap Corp.
Form 10-Q
For the Quarter Ended June 30, 2014

TABLE OF CONTENTS

Contents

Item 1.	Financial Statements	3

	Condensed Balance Sheets	3

	Condensed Statements of Operations	4

	Condensed Statements of Cash Flows	5 - 6

Item 3.	Quantitative and Qualitative Disclosures about Market Risk	14

Item 4.	Controls and Procedures	14

PART II – OTHER INFORMATION		15

Item 1.	Legal Proceedings	15

Item 1A.	Risk Factors	15

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	15

Item 3.	Defaults upon Senior Securities	15

Item 4.	Mine Safety Disclosures	15

Item 5.	Other Information	15

Item 6.	Exhibits	16

SIGNATURES		17

PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

FormCap Corp.

(A Development Stage Company)

Condensed Balance Sheets

	June 30, 2014			December 31, 2013
	(Unaudited)
ASSETS
TOTAL ASSETS
Cash		334			910
Other receivable		367,000			-
Promissory note receivable		8,902			9,266
Total Current Assets		376,236			10,176

OTHER ASSETS
Exploration property lease		516,802			101,802
TOTAL ASSETS	$	893,038			111,978

LIABILITIES AND STOCKHOLDERS’ EQUITY

CURRENT LIABILITIES
Accounts payable and accrued liabilities	$	115,047			101,297
Notes payable - related parties		111,500			111,500
Notes payable		75,653			78,653
Convertible notes payable		182,800			111,800
Convertible notes payable – related party		105,990			48,990
Royalty and license fee payable		135,000			135,000

Total Current Liabilities		725,990			587,240

TOTAL LIABILITIES		725,990			587,240

STOCKHOLDERS’ EQUITY

Preferred stock, 50,000,000 shares authorized at par value of $0.001, no shares issued and outstanding		-
Common stock, 200,000,000 shares authorized at par value of $0.001, 10,229,346 shares issued and outstanding (9,223,824 shares issued and outstanding as at December 31, 2013)		10,224			9,224
Stock subscription receivable		(17,000	)		(17,000	)
Additional paid-in capital		16,197,388			13,888,388
Deficit accumulated during the development stage		(16,023,564	)		(14,355,874	)

Total Stockholders’ Deficit		167,048			475,262

TOTAL LIABLITIES AND STOCKHOLDERS’ DEFICIT	$	893,038			111,978

The accompanying notes are an integral part of these condensed financial statements.

FormCap Corp.

(A Development Stage Company)

Condensed Statements of Operations

(Unaudited)

	Three Months ended June 30,					Six Months ended June 30,						From Inception on April 10, 1991 to June30,
	2014		2013			2014			2013			2014
REVENUES	$	-	$	-		$	-		$	-		$	321,889
COST OF SALES		-		-			-			-			352,683

GROSS MARGIN		-		-			-			-			(30,794	)

OPERATING EXPENSES

Consulting fees		-		5,000			-			5,000			1,056,889
Loss on impairment of assets		-		-			-			-			1,146,206
Financing expenses		-		-			-			-			778,946
General and administrative expenses		11,974		14,752			29,689			24,886			5,692,043

Total Operating Expenses		11,974		19,752			29,689			29,886			8,674,084

LOSS FROM OPERATIONS		11,974		19,752			29,689			29,886			8,704,878

OTHER INCOME AND (EXPENSE)

Interest expense		-		-			-			-			(864,230	)
Gain on settlement of debt		-		-			-			-			286,855
Loss on settlement of debt		-		(2,274,000	)		(1,638,000	)		(2,274,000	)		(6,741,311	)

Total Other Expense		-		(2,274,000	)		(1,638,000	)		(2,274,000	)		(7,318,686	)

LOSS BEFORE INCOME TAXES	$	11,974	$	2,293,752		$	1,667,689		$	2,303,886		$	16,023,564
Provision for income taxes		-		-			-			-

NETLOSS	$	11,974	$	2,293,752		$	1,667,689		$	2,303,886		$	-16,023,564

BASIC AND DILUTED NET LOSS PER COMMON SHARE	$	0.00	$	0.52		$	0.17		$	0.98

BASIC AND DILUTED WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING		5,140,154		4,429,865			9,925,472			2,351,869

The accompanying notes are an integral part of these condensed financial statements .

FormCap Corp.

(A Development Stage Company)

Condensed Statements of Cash Flows

(Unaudited)

	For the Six Months Ended June 30,						From Inception on April 10, 1991 to June30,
	2014			2013			2014
CASH FLOWS FROM OPERATING ACTIVITIES

Net Loss	$	(1,667,689	)	$	(2,303,886	)	$	(16,023,564	)
Adjustments to reconcile net loss to net cash used by operating activities:
Amortization of prepaid expenses								324,262
Amortization of beneficial conversion feature								379,961
Expenses paid on behalf of the Company								3,569
Expenses paid by related parties								119,133
Depreciation and amortization								281,322
Gain on settlement of debt and extinguishing of oil and gas leases								(286,855	)
Common stock and options issued for services								943,977
Common stock and options issued for collateral and extension of debt								17,500
Loss on impairment of assets								1,174,833
Loss on settlement of debt		1,638,000			2,274,000			8,062,908
Interest expense in connection with induced conversion								262,032
Foreign currency exchange		364						(121,178	)
Changes to operating assets and liabilities:
Accounts receivable								3,203
Inventories								(66,200	)
Prepaid expenses and other current assets								(140,429	)
Prepaid royalties								(99,980	)
Accounts payable and accrued liabilities		3,749			6,485			145394
Bank overdraft								0
Royalty and license fees								196,765

Net Cash Used in Operating Activities		(25,576	)		(23,401	)		(4,835,884	)

CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of capital assets								(104,880	)
Acquisition deposits								(431,000	)
Extinguishment of oil and gas leases								-
Purchase of oil and gas lease								(256,802	)
Capitalized software expenditures								(135,181	)
Principal payments on notes receivable								44,117
Notes receivable advances					(11,194	)		(701,152	)
Convertible promissory note receivable								(9,266	)
Proceeds from sale of notes receivable								(350,000	)
		(110,000	)		(11,194	)		(1,224,164	)
Net Cash Used in Operating and Investing Activities		(25,576	)		(34,595	)		(6,060,048	)

The accompanying notes are an integral part of these condensed financial statements

FormCap Corp.

(A Development Stage Company)

Condensed Statements of Cash Flows (Continued)

(Unaudited)

	For the Six Months Ended June 30,						From Inception on April 10, 1991 to June 30,
	2014			2013			2014
Net Cash Used in Operating and Investing Activities	$	(25,576	)		(34,595	)			(6,060,048	)

CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from related party payables									2,065,177
Repayments of related party payables		21,000							(616,012	)
Proceeds from notes payable		7,000			34,967				938,919
Repayment of notes payable
Proceeds from the sale of preferred stock									3,000
Proceeds from Convertible notes payable		(3000	)						73,790
Net Cash Provided by Financing Activities		25,000			34,967				6,167,116

NET INCREASE (DECREASE) IN CASH		(576	)		372				334
CASH AT BEGINNING OF PERIOD		910			48				-

CASH AT END OF PERIOD	$	334		$	420			$	334

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION

CASH PAID FOR:
Interest	$	-		$	-			$	12,660

NON CASH FINANCING ACTIVITIES:
Common stock issued for rounding shares	$	-		$	-			$	12
Common stock issued for prepaid expenses	$	-		$	-			$	280,000
Common stock issued for purchase of oil and gas leases	$	1,638,000		$	-			$	1,658,000
Conversion of related party payables to common stock	$	-		$	-			$	3,984,999
Extinguishment of related party notes payable and Accounts Payable	$	-		$	-			$	2,699,000
Notes Payable Issued for Oil and Gas Lease	$	-		$	-			$	175,000

The accompanying notes are an integral part of these condensed financial statements.

FormCap Corp.

(A Development Stage Company)

Notes to the Condensed Financial Statements

June 30, 2014

(Unaudited)

NOTE 1 - CONDENSED FINANCIAL STATEMENTS

The accompanying financial statements have been prepared by the Company without audit. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows at June 30, 2014, and for all periods presented herein, have been made.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. It is suggested that these financial statements be read in conjunction with the financial statements and notes thereto included in the Company's December 31, 2013 audited financial statements. The results of operations for the periods ended June 30, 2014 and 2013 are not necessarily indicative of the operating results for the full years.

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.

Reclassification of Financial Statement Accounts

Certain amounts in the condensed financial statements have been reclassified to conform to the presentation adopted in the June 30, 2014 condensed financial statements.

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.

Development Stage Company

The Company is considered to be in the development stage as defined in Accounting Standards Codification (ASC) 915 “Development Stage Entities.” The Company is devoting substantially all of its efforts to development of business plans.

Basic 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 dilutive or potentially dilutive instruments outstanding as of June 30, 2014 and December 31, 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.

FormCap Corp.

(A Development Stage Company)

Notes to the Condensed Financial Statements

June 30, 2014

(Unaudited)

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 three and six months ended June 30, 2014 and the year ended December 31, 2013.

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.

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.

Recent Accounting Pronouncements

Except for rules and interpretive releases of the SEC under authority of federal securities laws and a limited number of grandfathered standards, the FASB Accounting Standards Codification™ (“ASC”) is the sole source of authoritative GAAP literature recognized by the FASB and applicable to the Company. Management has reviewed the aforementioned rules and releases and believes any effect will not have a material impact on the Company's present or future consolidated financial statements.

FormCap Corp.

(A Development Stage Company)

Notes to the Condensed Financial Statements

June 30, 2014

(Unaudited)

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.

NOTE 4 - PROMISSORY NOTE RECEIVABLE

On June 3, 2013 the Company advanced the sum of $11,194 to an unrelated Canadian company. The loan is secured by a promissory note which matures on December 31, 2014. On November 30, 2013 the borrower company repaid $1,928. As at June 30, 2014, the borrower company owed the Company $8,902.

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 borrower 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.

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 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 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 $671,938.90 (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 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 are 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 is 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 may 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 has agreed not to exercise any voting rights of the shares issued to it nor influence or cause any change in control of the Company.

FormCap Corp.

(A Development Stage Company)

Notes to the Condensed Financial Statements

June 30, 2014

(Unaudited)

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 2400 acres of the Cowley leases. Ironridge is obligated to provide $367,000 to the Company to fund the drilling of two test wells on the Cowley lands.

As at June 30, 2014 the Company has capitalized $516,802 toward the acquisition of the Cowley Leases. (December 31, 2013 - $101,802)

NOTE 6 - RELATED PARTY PAYABLES

The Company from time to time has borrowed funds from or has received services from several individuals and corporations related to the Company for operating purposes As of June 30, 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 7 - PROMISSORY NOTES PAYABLE

As at June 30, 2014 the Company owed $75,653 to several unrelated third parties (December 31, 2013 - $78,653). These amounts bear no interest, are not collateralized and are due on demand.

NOTE 8 - PROMISSORY NOTES PAYABLE – RELATED PARTIES

As at June 30, 2014 the Company owed $111,500 to several related parties (December 31, 2013 - $111,500) to several third parties. These amounts bear no interest, are not collateralized and are due on demand.

NOTE 9 - CONVERTIBLE PROMISSORY NOTES PAYABLE

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.

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

As at June 30, 2014, the Company owed $182,800 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 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.

FormCap Corp.

(A Development Stage Company)

Notes to the Condensed Financial Statements

June 30, 2014

(Unaudited)

NOTE 10 - CONVERTIBLE PROMISSORY NOTES PAYABLE – RELATED PARTY

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.

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.

As at June 30, 2014, the Company owed $105,990 to related party holders of Convertible Promissory notes (December 31, 2013 - $48,990)

NOTE 11 - COMMON STOCK

The Company has two classes of stock authorized as of June 30, 2014. The Company has 50,000,000 shares of preferred stock authorized with no shares outstanding as of June 30, 2014 and December 31, 2013. The Company also has 200,000,000 shares of common stock authorized with 10,229,346 shares issued and outstanding as of June 30, 2014 (December 31, 2013 – 9,823,824)

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.

During the six months ended June 30, 2014, the Company issued 1,000,000 shares of common stock in connection with the purchase of the Cowley leases.

The Company did not issue any shares of common stock during the three month periods ended June 30, 2014 and 2013, respectively.

NOTE 12 - SUBSEQUENT EVENTS

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 became effective on July 31, 2014.

Item 2. 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.

Overview

The Company does not currently engage in any business activities that provide cash flow. The Company is currently in the development stage.

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 agreed to pay 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.

On May 27, 2014 the Company announced that that a drilling contract had been executed between Val Energy Inc., Wichita, Kansas and FormCap’s operator; Tiger Oil & Gas LLC, Wichita, Kansas to commence drilling on the 2400 acres of prospective oil and gas leases owned by the Company in Cowley County, Kansas, and submitted a Notice of Intent to Drill the Kansas Corporation Commission. On July 10, 2014 the Company announced that, due to market conditions, the drilling program has been postponed. The Intent to Drill licence remains valid until August 1, 2014, at which date the Company intends to re-file for a further 60 days.

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.

Results of Operations for the Three and Six Months Ended June 30, 2014 and 2013.

Revenues. There was no revenue for the three and six months ended June 30, 2014 and 2013, respectively.

Operating Expenses. For the three months and six months ended June 30, 2014, we had total operating expenses of $11,974 and $29,689 respectively; as compared with operating expenses of $19,752 and $29,886 for the three months and six months ended June 30, 2013, respectively, representing a decrease in operating expenses of $2,778 for the three months ended June 30, 2014 and an increase of $4,803 for the six months ended on that date.

Accounting and Audit and review fees amounted to $8750 for the three ended June 30, 2014, as compared with $11,030 for the three months ended June 30, 2013 – a decrease of $2,280; and $23,750 for the six months ended June 30, 2014 as compared with $19,030 for the six months ended June 30, 2013 – an increase of $4720. The overall increase resulted from additional work related to the Ironridge financing.

Filing and Transfer agents’ expense decreased by $2,667 from $3,054 during the three months ended June 30, 2013 to $387 for the three months ended June 30, 2014. For the six months ended June 30, 2014 this category of expense amounted to $2,400, representing a decrease of $2,736 from the amount expended during the six months ended June 30, 2013. The decrease resulted from reduced corporate activity during the periods under review.

The Company recognized a gain on foreign exchange transactions of $264 for the three months ended June 30, 2014 and a loss on foreign exchange of $384 for the six months ended June 30, 2014, as compared with a loss of $588 for the three months ended June 30, 2013 and a loss of $604 for the six months ended June 30, 2013. These losses arose as a result of fluctuations in the exchange rates between the US Dollar and foreign currencies

Interest Expense: There was no interest expense for the three and six months ending June 30, 2014 and 2013, respectively, as the liabilities of the Company bear no interest.

Loss on settlement of Debt: During the six months ended June 30, 2014, the Company recognized a loss in the amount of $1,638,000 in connection with the Ironridge transaction. During the six months ended June 30, 2013 the Company recognized losses in the amount of $2,274,000 in connection with the settlement of certain debts.

Net Loss: The net losses for the three and six months ended June 30, 2014 were $11,974 and $1,667,689 respectively, as compared with net losses of $2,293,752 and $2,303,886 for the three and six months ended June 30, 2013, respectively, representing decreases of $2,281,778 for the three months ended June 30, 2014 and $636,197 for the six months ended on that date.

Liquidity and Capital Resources

As at June 30, 2014, our current assets were $376,236 (December 31, 2013 - $10,176) and our current liabilities were $725,989 (December 31, 2013 - $597,240), resulting in a working capital deficit of $349,753 as at June 30, 2014, as compared with a working capital deficit of $577,064 at December 31, 2013.

Total Stockholders’ Deficit decreased from $475,262 at December 31, 2013 to a Total Stockholders’ Surplus of $167,049 as at June 30, 2014.

Cash Flows Generated by Operating Activities

For the six months ended June 30, 2014, net cash flows used in operating activities was $25,576, consisting of cash expended for operations of $576, offset by an increase of $3,750 in Accounts Payable and Accrued Liabilities.

Cash Flow Provided by Financing Activities

We have financed our operations primarily from either advances from related parties or the issuance of equity and debt instruments. During the six months ended June 30, 2014, we issued convertible promissory notes to lenders in the amount of $128,000 and repaid $3,000 to holders of these notes. During the six months ended June 30, 2013 we issued notes payable in the amount of $34,967.

We expect that working capital requirements will continue to be funded through further issuances of securities.

Off-Balance Sheet Arrangements

We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to investors.

Recent Accounting Pronouncements

For the three month period ended March 31, 2014, there were no accounting standards or interpretations issued that are expected to have a material impact on our financial position, operations or cash flows.

Item 3. Quantitative and Qualitative Disclosures about Market Risk

As a “smaller reporting company” (as defined in Item 10(f)(1) of Regulation S-K), our Company is not required to provide information required by this Item.

Item 4. Controls and Procedures

As required by Rule 13a-15 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), we have carried out an evaluation of the effectiveness of the design and operation of our Company's disclosure controls and procedures as of the end of the period covered by this quarterly report, being June 30, 2014. This evaluation was carried out under the supervision and with the participation of our Company's management, including our President, Principal Executive Officer and Principal Financial Officer. Based upon that evaluation, our President, Principal Executive Officer and Principal Financial Officer concluded that our disclosure controls and procedures are not effective as of the end of the period covered by this report due to the material weaknesses described in Management's Report on Internal Control over Financial Reporting included in our annual report on Form 10-K for the year ended December 31, 2013.

There have been no significant changes in our Company's internal controls or in other factors, which could significantly affect internal controls subsequent to the date we carried out our evaluation. Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in our Company's reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our Company's reports filed under the Exchange Act is accumulated and communicated to management, including our Company's president and Principal Executive Officer as appropriate, to allow timely decisions regarding required disclosure.

There have been no changes in our internal controls over financial reporting during the most recently completed fiscal quarter that have materially affected or are reasonably likely to materially affect the Company’s internal control over financial reporting.

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 1A. Risk Factors

As a “smaller reporting company” (as defined in Item 10(f)(1) of Regulation S-K), our Company is not required to provide information required by this Item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The Company did not issue any additional shares during the year ended December 31, 2012.

On May 16, 2013, 50,000,000 common shares were issued under a debt settlement agreement with a related Party.

On May 20, 2013, 39,999,998 common shares were issued under a debt settlement agreement with a related Party.

On November 7, 2013, 200,000 common shares were issued in connection with the acquisition of exploration property leases.

On February 24, 2014, 10,000,000 common shares were issued in connection with the acquisition of exploration property leases.

Item 3. Defaults upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

None

Item 6. Exhibits

Exhibit No.		Description
31		Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.
32		Certification of Principal Executive Officer and Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, filed herewith.

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.

FORMCAP CORP.

/s/ Brad Moynes

Brad Moynes

President, Secretary, Treasurer and Director

(Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer)

Dated: August 13, 2014

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