10-K 1 0001.txt U.S SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-KSB (Mark One) [x] Annual report under Section 13 or 15 (d) of the Securities Exchange Act of 1934 (Fee required) For the fiscal year ended April 30, 2000 [ ] Transition report under Section 13 or 15 (d) of the Securities Exchange Act of 1934 (No fee required) For the transition period from to Commission file number 0-8299 CAMELOT CORPORATION (Name of Small Business Issuer in Its Charter) Colorado 84-0691531 (State or other jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) PMB 249, 6757 Arapaho Road, Suite 711, Dallas, Texas 75248 (Address of Principal Executive Office) (Zip Code) (Former Address of Principal Executive Office) (Zip Code) (972) 458-1767 (Issuer's Telephone Number, Including Area Code) Securities registered under Section 12(b) of the Exchange Act: Name of Each Exchange Title of Each Class on Which Registered None None Securities registered under Section 12(g) of the Exchange Act: None Check whether the issuer: (1) 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. [x] Yes [ ] No Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B contained in this form, and no disclosure will be contained, to the best of registrant's knowledge, in a definitive proxy or information statements incorporated by reference in Part III of this Form 10- KSB or any amendment to this Form 10-KSB. [x]Yes [ ] No Issuer's revenues for its most recent fiscal year is $ - . As of July 27, 2000, the aggregate market value of the voting stock held by non-affiliates was $60,000. The number of shares outstanding of the Registrant's common stock $0.01 par value was 6,293,740 at July 27, 2000. Documents Incorporated by Reference. NONE PART 1 Item 1. Business Camelot Corporation (_ Registrant_ or _ the Company_ ) is a holding company with one inactive subsidiary. All its other subsidiaries have been dissolved by its state of incorporation. During the fiscal year ended April 30, 1999 the Company had no operations. All previous business operations have been discontinued. The Company's primary assets are preferred shares in OTC Bulletin Board companies. The Company was incorporated in Colorado on September 5, 1975, and completed a $500,000 public offering of its common stock in March 1976. The Company has made several acquisitions and divestments of businesses (see Discontinued Activities - Acquisition and Divestment History). The Company was delisted from NASDAQ's Small Cap Market on February 26, 1998. Subsequently it was unable to raise additional capital required to continue the trading activities of its operating subsidiaries. Its principle subsidiary, Third Planet Publishing, Inc. sold all rights, title and interests to its software and hardware products on March 31, 1998 and has since been dissolved by the state of Florida. Its remaining operating subsidiary mrcdrom.com, inc. liquidated its inventory and ceased trading in July, 1998. In July, 1998 all employees of Camelot and its subsidiaries were terminated. Its directors and officers have since provided unpaid services on a part-time basis to the Company. Discontinued Activities - Acquisition and Divestment History The Company's activities were conducted through subsidiaries, all of which are now discontinued or have been sold. Third Planet Publishing, Inc., (`Third Planet_) (established in January 1995) was a research and development company developing hardware and software solutions for audio and video conferencing over the Internet. mrcdrom.com, inc. (_ mrcdrom.com_ ), (established in March 1998) was an Internet catalog retailer of software. Camelot Internet Access Services, Inc. (_CIAS_ ), (established in June 1996) was a provider of Internet access services. Alexander Mark Investments (USA), Inc. (_ AMI_) (80% acquired in May 1997) was a U.S. public holding company whose only investment was a shareholding in Meteor Technology plc (_ Meteor_ ) a U.K. public company. Third Planet was a research and development company focusing on the development of VideoTalk, a video conferencing system for the Internet. Approximately $7,000,000 was expended by Third Planet in developing VideoTalk and its ancilliary software product DigiPhone since inception. VideoTalk was successfully demonstrated at COMDEX in the later part of 1997. However, a lack of funds for marketing the product was experienced in 1998. Following the Company's delisting from NASDAQ Small Cap Market in February, 1998 Third Planet sold on March 31, 1998 all rights, title and interest in VideoTalk and its ancilliary products to Wincroft, Inc. a US public company traded on the OTC Bulletin Board. The consideration was $7,002,056 payable by the issuance of 5,000,000 Preferred Shares, Series A and 1,028,000 Common Shares in Wincroft together with a $2,000,000 note. Subsequently, on June 29, 1998 the $2,000,000 note was converted into 2,000,000 Preferred Shares, Series B in Wincroft. The Company made other acquisitions as follows: Date Name Business Cost March 1991 Vesta Land Title Company Titles $120,000 July 1991 Business Investigations Investigations $312,231 July 1992 McKee-Blanchard Appraisals $ 32,203 September 1992 First Appraisal Group Appraisals $ 15,000 June 1994 Maxmedia Distributing Software Distribution $168,500 These companies ceased doing business in July 1994, July 1994, November 1993, November 1993, and May 1995, respectively. On September 16, 1988, the Company acquired Stock Transfer Company of America, Inc. ("STCA"), a transfer agent, for 6,666 newly issued common shares of the Company (post reverse split). In connection with this transaction, Daniel Wettreich was appointed a Director, Chairman and Chief Executive Officer and Jeanette Fitzgerald was appointed a Director. On April 11, 1994, following a decision by the Directors of the Company to discontinue financial services activities, STCA was sold to a company affiliated with Mr. Wettreich for book value, $13,276. (See Item 12. Certain Relationships and Related Transactions). On March 2, 1990, the Company's subsidiary, Beecher Energy, Ltd. ("Beecher") was listed on the Vancouver Stock Exchange in an initial public offering. The Company sold its 69% shareholdings in Beecher on July 6, 1994 for C$400,000, (US $288,293). In January 1991, the Company acquired for cash an 80% majority interest in Forme Capital, Inc. ("Forme") a publicly traded real estate company from the wife of Mr. Wettreich. In September 1993, the Company sold to Forme two office properties and then sold all its investment in Forme for cash (approximately $40,000) to Mrs. Wettreich. These transactions were approved by the shareholders of the Company at the Annual Meeting held on February 15, 1994. In July, 1993, Registrant acquired approximately 40% of the issued share capital of Goldstar Video Corporation ("GVC"), a video marketing company for a net price of $92,432. Registrant also made a $150,000 secured loan to GVC. Further, Goldstar Entertainment, Inc. ("GEI") a subsidiary of Registrant acquired certain licenses and other assets from GVC for $375,000. Thereafter Registrant's subsidiary Camelot Entertainment, Inc. commenced business as a video marketing company. On October 20, 1993, GVC filed for protection from creditors under Chapter 11 of the Bankruptcy Code which was converted to Chapter 7 on February 4, 1994. Registrant was not a controlling shareholder of GVC. The Company's subsidiary Camelot Entertainment, Inc. filed under Chapter 7 of the US Bankruptcy laws in January 1995. In November 1995, Registrant appointed Firecrest Group plc a public company, as exclusive distributor for DigiPhone in the United Kingdom and Ireland in consideration for $1,950,575 payable by shares equal to approximately 10% of Firecrest. (_Digiphone Rights_ ) In March 1996 all relations with Firecrest were terminated and Registrant sold all its shares in Firecrest in market transactions. Subsequently, Firecrest sold its DigiPhone Rights to Meteor. In July 1996, Registrant sold the European rights to distribute DigiPhone to DigiPhone Europe Ltd which became a subsidiary of Meteor. The consideration was #5,000,000 of loan stock which was subsequently converted into Meteor shares. In November 1996 Registrant sold the international DigiPhone rights to Meteor for #1,000,000 of loan stock which subsequently was converted into Meteor shares. In May 1998, DigiPhone International, Ltd. a Meteor subsidiary, became the exclusive marketing company for all Third Planet products on a worldwide basis. In May 1997, Registrant acquired approximately 80% of AMI whose principle asset was approximately 57% of Meteor. The consideration (post reverse split) payable to the seller, Adina, Inc. (_ Adina_ ) was 892,015 Preferred Shares, Series J of Registrant and 453,080 Preferred Shares, Series J in deferred consideration. Following the transaction Adina had 49% of the voting rights attributable to the issued and outstanding common and preferred shares of Registrant. Mr. Wettreich is a director of Adina and did not participate in any directors' votes in relation to this transaction. Registrant, through its acquisition of 80% of AMI in May 1997 obtained control of Meteor, a U.K. listed public company which was subsequently renamed Constable Group plc. Meteor's two operational subsidiaries, were DigiPhone International Ltd. and Meteor Payphones Ltd. DigiPhone International was the worldwide distributor for all products developed by Third Planet and was sold to Registrant in January, 1998 for cancellation of #500,000 loan stock owed to Camelot by Meteor. All rights owned by DigiPhone International were transferred to Third Planet Publishing prior to the sale of VideoTalk to Wincroft. Registrant sold all its shareholding in AMI for $38,063 on March 20, 1998. Meteor Payphones and its sister payphone companies were placed into liquidation on 30th March 1998. Constable Group plc (formerly Meteor Technology plc) was placed into liquidation on 31st July 1998. mrcdrom.com began operations in April, 1997 as an Internet shopping company selling software titles over the World Wide Web. It also announced the filing of a registration statement to raise up to $12,000,000 through an initial public offering (_IPO_ ) over the Internet, however such registration was withdrawn and no funds were raised. mrcdrom.com had losses throughout its trading history and due to the inability of Registrant to fund such continuing losses ceased doing business in July, 1998, liquidated all its inventory, and terminated all its employees. The Company is now inactive. Camelot Internet Access Services, Inc. was an Internet services provider formed in January 1996 using the UUNet backbone. This subsidiary's principle activities were the provision of support services for Registrant and the provision of Internet access to users of DigiPhone who would otherwise be unable to access the Internet. The Company became inactive during 1997. In February 1997, Registrant acquired from Meteor the U.S.A. and Canadian rights to PCAMS software, a payphone contract and management system originally developed for Meteor's payphone subsidiary. The consideration was cancellation of $2,000,000 unsecured convertible loan stock owed by Meteor to Camelot, and the issuance by Camelot of 3,238,400 restricted common shares of Camelot. Management intended to utilize PCAMS software both by offering such software to independent providers and by seeking acquisitions of payphone businesses. Registrant's limited resources precluded active marketing of this product and in March 1998 the product was sold back to Meteor for $70,000. Employees As of July 14, 1998, the Company ceased having any employees. Its directors and officers have since provided unpaid services on a part-time basis as needed to the Company. Item 2. Properties Company previously leased, approximately 25,700 square feet of warehouse and office space in Carrollton, Texas on a lease expiring on December 31, 2000. As of July 24, 1998 this lease was terminated by the payment of $39,781 by the Company to the landlord and the Company has no further liability under the terms of the lease. The Company rents an accommodation address in Dallas, Texas on a month to month basis for a nominal fee. Item 3. Legal Proceedings No material legal proceedings to which the Company is a party is subject or pending and no such proceedings are known by the Company to be contemplated. There are no proceedings to which any director, officer or affiliate of the Company, or any owner of record (or beneficiary) of more than 5% of any class of voting securities of the Company is a party adverse to the Company. Item 4. Submission of Matters to a Vote of Security Holders No matters were submitted to a vote of the security holders during the final quarter of the fiscal year or subsequent to the end of the fiscal year. Part II Item 5. Market for Registrant's Common Equity and Related Stockholder Matters The Company's common stock trades on the OTC Bulletin Board. The following table sets forth the quarterly high and low prices of the common stock for the last two years. They reflect inter- dealer prices, without retail mark-up, mark-down or commission, and may not necessarily represent actual transactions. High Low 2000 First July 31, 1999 0.01 0.01 Second October 31, 1999 0.01 0.01 Third January 31, 2000 0.01 0.01 Fourth April 30, 2000 0.01 0.01 1999 First July 31, 1998 0.14 0.14 Second October 31, 1998 0.31 0.20 Third January 31, 1999 0.50 0.10 Fourth April 30, 1999 0.20 0.20 As of July 27, 2000, the Company had approximately 1,175 shareholders of record of Company's common stock. No dividends have been declared on the stock in the last two fiscal years and the Board of Directors does not presently intend to pay dividends in the near future. Item 6. Management Discussion and Analysis 2000 The Company's revenue for the period ended April 30, 2000 was $0 compared with $0 in the comparable period. Net loss for the three month period was $508,840 compared with a loss for the previous year of $994,305. The loss was due to a write off of accounts receivable, and to the cancellation of a note in exchange for Wincroft stock previously sold in consideration for such note. The Wincroft stock was written down to nil to reflect market value. Further a loss was incurred from the sale of Forme Capital preferred stock to Forme for par value. The company is now inactive. The consolidated balance sheets for the period show total assets of $3,631 compared with $586,315 for the comparable period. 1999 The Company's revenue for the period was $0 compared with $275,435 in 1998. Net loss for the period was $994,305 compared with a loss for the previous year of $6,074,163. These results are due to the lack of operations as the subsidiaries ceased doing business. The consolidated balance sheets for the period show stockholders' equity of $586,315 compared with $1,707,668 for the financial year ended April 30, 1998. Total assets were $633,883 compared with $1,968,294 for the comparable period. The decrease in stockholders' equity and total assets was due to the loss attributable to closing of the operating subsidiaries. The Company failed to make its dividend payment on the Preferred Shares, Series E and paid off the dividend due and redeemed the Preferred Shares by transferring 125,000 restricted common shares in Wincroft, Inc. at market value. A majority of the subsidiaries have been dissolved by their state of incorporation due to a lack of funding. The following subsidiaries were dissolved by their respective states: Third Planet Publishing, Inc. Kids University, Inc. Maxmedia Distributing, Inc. Atlantic Media, Inc. Camelot Creative Designs, Inc. Business Investigations, Inc. SAC Distributing, Inc. Mr. CD-ROM Stores, Inc. Camelot Distributing, Inc. Camelot Internet Access Services, Inc. Camelot Energy, Inc. On June 29, 1998, Registrant agreed with Wincroft, Inc., at the request of Wincroft, to satisfy the outstanding Promissory Note payable to Camelot by Wincroft in the amount of $2,000,000 of Wincroft Non-Voting Preferred Stock, Series B. These Preferred Shares pay a dividend of 10% when and as declared by the board of directors and will pay an additional yield equivalent to 10% of any revenues derived by Wincroft on sale of VideoTalk. The Preferred Shares also call for redemption by Wincroft in the event VideoTalk is sold. Wincroft requested this action in order to assist in its fund raising capabilities. Wincroft is seeking funds to pay for working capital and marketing expenditures. On February 15, 1999, the Registrant settled outstanding litigation with Audio Visual Group dba AIMS Media (_AIMS_ ) in order to eliminate the expense of further litigation and without admitting any liability by the transference of 200,000 restricted common shares of Wincroft, Inc., owned by the Registrant to AIMS. The Company issued 275,192 shares and transferred 3,000 shares of Wincroft to its attorney's in settlement of legal fees in relation to this litigation. On February 24, 1999 in order to provide cash and future stream of cash flow the Company sold to Texas Country Gold Development, Inc., a company affiliated with its President, 700,000 shares of Wincroft for $87,500 payable $1,000 in cash and $86,500 in a note yielding 6%. Liquidity and Capital Resources 2000 Net cash used in operating activities for the period ended April 30, 2000 was $(2,292) compared with $(148,299) in 1999. Net cash used by investing activities was $0 compared with $1,000 in 1999. Net cash provided by financing activities was $0 compared with $(4,800) in 1999. Cash of $3,631 compared with $666 at April 30, 1999. 1999 Net cash used by operating activities for the 1999 was $148,299 compared with $3,757,870 in 1998. Net cash supplied by investing activities was $1,000 compared with net cash used of $730,884 in 1998. Net cash used by financing activities was $4,800 compared with $1,611,520 provided in 1998. Cash of $666 compares with $152,765 at April 30, 1998. The Company does not have any plans for capital expenditures. The Company has negligible cash resources and will experience liquidity problems over the next twelve months due to its lack of revenue unless it is able to raise funds from outside sources. There are no known trends, demands, commitments, or events that would result in or that is reasonably likely to result in the Company's liquidity increasing or decreasing in a material way. Item 7. Financial Statement and Supplementary Data Index to Consolidated Financial Statements Page Report of Independent Auditors F-1 Consolidated Financial Statements Balance Sheet - April 30, 2000 F-2 Statements of Operations and Other Comprehensive Income for the years ended April 30, 2000 and 1999 F-3 Statements of Stockholders' Equity for the years ended April 30, 2000 and 1999 F-4 Statements of Cash Flows for the years ended April 30, 2000 and 1999 F-5 and F-6 Notes to Consolidated Financial Statements F-7 through F-18 Larry O'Donnell, CPA, P.C. Telephone (303) 745-4545 2280 South Xanadu Way Suite 370 Aurora, Colorado 80014 REPORT OF INDEPENDENT AUDITOR Board of Directors and Stockholders Camelot Corporation and Subsidiaries I have audited the accompanying consolidated balance sheet of Camelot Corporation and Subsidiaries as of April 30, 2000 and the related consolidated statements of operations, stockholders' equity, and cash flows for the two years then ended. These financial statements are the responsibility of the Company's management. My responsibility is to express an opinion on these financial statements based on my audit I conducted my audit in accordance with generally accepted auditing standards. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe my audit provides a reasonable basis for my opinion. In my opinion, the financial statements referred to above present fairly, in all material respects, the consolidated financial position of Camelot Corporation and Subsidiaries as of April 30, 2000, and the consolidated results of their operations and their consolidated cash flows for the years ended April 30, 2000 and 1999, in conformity with 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 10 to the financial statements, the Company's significant operating losses raise substantial doubt about its ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. Larry O'Donnell, CPA, PC May 8, 2000 CAMELOT CORPORATION AND SUBSIDIARIES Consolidated Balance Sheet April 30, 2000 ASSETS CURRENT ASSETS Cash and cash equivalents $ 3,755 Total current assets $ 3,755 $ 3,755 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 37,849 Total current liabilities $ 37,849 STOCKHOLDERS' EQUITY Common stock, $.01 par value, 50,000,000 shares authorized, 6,293,740 shares issued and outstanding 62,937 Preferred stock, $.01 par value, 100,000,000 shares authorized, 1,345,305 shares issued and outstanding 13,453 Additional paid-in capital 35,597,921 Accumulated deficit (32,871,708) Less treasury stock at cost, 29,245 shares (2,836,697) Total stockholders' equity (34,094) $ 3,755
See accompanying notes to consolidated financial statements F-2 CAMELOT CORPORATION AND SUBSIDIARIES Consolidated Statements of Operations Years Ended April 30, 2000 1999 REVENUES $ - $ - OPERATING EXPENSES General and administrative 8,484 59,498 Total costs and expenses 8,484 59,498 LOSS FROM OPERATIONS (8,484) (59,498) OTHER INCOME (EXPENSE) Interest and miscellaneous 5,912 3,282 Loss on investment in affiliate (525,536) (83,388) Note receivable allowance (92,300) Realized gain (loss) on sale of marketable securities (851,419) Total other income (expense) (611,924) (934,807) NET LOSS (620,408) (994,305) DIVIDENDS ON PREFERRED STOCK (4,800) TOTAL COMPREHENSIVE INCOME ATTRIBUTAL TO COMMON STOCKHOLDERS $ (620,408)$ (999,105) INCOME (LOSS) PER SHARE: Income (loss) from continuing operations $ (.098) $ (.188) Dividends on preferred stock (.000) (.000) Net Loss Net loss attributable to common stockholders $ (.098) $ (.188) Weighted average number of common stock and common stock equivalent shares 6,293,740 5,308,453
See accompanying notes to consolidated financial statements F-3 CAMELOT CORPORATION AND SUBSIDIARIES Consolidated Statements of Stockholders' Equity For the Period from May 1, 1998 through April 30, 2000 Common Common Preferred Preferred Additional Stock Stock Stock Stock Paid in Shares Amount Shares Amount Capital Balance at 1,784,200 17,842 1,453,400 14,534 35,768,983 April 30, 1998 Exchange of Series - (108,095) (1,081) (123,919) L Preferred Stock for shares of Wincroft Adjustment 4,234,348 42,343 (42,343) to correct shares Issuance of Common 275,192 2,752 Stock for services Cancellati on of Common Stock subscripti on for treasury stock Change in unrealized loss on available for sale securities Preferred Stock (4,800) dividends to related party Net Loss _______ _______ _______ ___________ Balance at 6,293,740 $62,937 1,345,305 $13,453 $35,597,921 April 30, 1999 ________ _______ _________ ________ __________ _ Balance at 6,293,740 $62,937 1,345,305 $13,453 $35,597,921 April 30, 2000 ======= ====== ======== ======= ========= See accompanying notes to consolidated financial statements F-4 Accumulated Treasury Stock Total Deficit Stock Subscription Stockholders' Receivable Equity (Deficit) Balance at (31,256,995) (2,755,638) (81,059) 1,707,667 April 30, 1998 Exchange of Series L (125,000) Preferred Stock for shares of Wincroft Adjustment to correct shares Issuance of Common 2,752 Stock for services Cancellatio n of Common Stock (81,059) 81,059 subscriptio n for treasury stock Change in unrealized loss on available for sale securities Preferred Stock (4,800) dividends to related party Net Loss (994,305) __________ (994,305) Balance at $(32,251,300) $(2,836,697) - $586,314 April 30, 1999 (620,408 ) __________ ________ (620,408) Balance at $(32,871,708) $(2,836,697) $(34,094) April 30, 2000 ========= ======== ========= ======
CAMELOT CORPORATION AND SUBSIDIARIES Consolidated Statements of Cash Flows Years Ended April 30, 2000 1999 CASH FLOWS FROM OPERATING ACTIVITIES: Net (Loss) $(620,408) $(994,305) Adjustments to reconcile net loss to net cash used in operating activities: Non cash transactions for services 4,415 Loss on disposal of securities 525,536 931,807 Provision for inventory obsolescence 50,000 Note receivable allowance 92,300 Change in assets and liabilities Accounts receivable 10,000 32,356 Prepaid expenses 40,486 Accounts payable and accrued expenses (9,720) (213,058) Net cash used in operating activities (2,292) (148,299) CASH FLOW FROM INVESTING ACTIVITIES: Proceeds from sale of securities 5,381 1,000 Net cash provided by (used in) investing activities 5,381 1,000 CASH FLOWS FROM FINANCING ACTIVITIES: Dividends paid (4,800) Net cash provided by (used in) financing activities (4,800) (4,800) NET INCREASE (DECREASE) IN CASH 3,089 (152,099) Cash at beginning of year 666 152,765 Cash at ending of year $3,755 $666
See accompanying notes to consolidated financial statements F-5 CAMELOT CORPORATION AND SUBSIDIARIES Consolidated Statements of Cash Flows (Continued) Years Ended April 30, 2000 1999 Supplemental information: Cash paid for interest $ - $ - Cash paid for income taxes $ - $ - NONCASH INVESTING AND FINANCING ACTIVITIES In fiscal 1999, The Company sold shares of Wincroft, Inc. to a related party for $1,000 cash and a note receivable of $86,500. In fiscal 1999, the Company exchanged 1,081 shares of preferred stock for shares of Wincroft, Inc. During the nine months ended January 31, 2000 the Company wrote off 700,000 shares of Wincroft, Inc. received in cancellation of a demand note from a company affiliated with the President of the Company totaling $86,500. See accompanying notes to consolidated financial statements F-6 CAMELOT CORPORATION AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Business Activity and Principles of Consolidation The consolidated financial statements include the Company and its majority owned subsidiaries (collectively the "Company"). The Company is now inactive and all its operating subsidiaries have discontinued operations. The Company was primarily engaged in research and development of Internet software and hardware and the retailing of computer software over the Internet. Discontinued operations of subsidiaries were involved in selling software products through retail stores located in the Dallas metroplex, the provision of Internet services, video marketing and distribution, financial services, real estate rentals, and oil and gas development. Significant intercompany accounts and transactions have been eliminated. Cash and Cash Equivalents The Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The company and its subsidiaries maintain cash balances at several financial institutions and a brokerage firm in Carrollton, Texas. Cash equivalents are composed primarily of investments in a money market account. The Company believes it is not exposed to any significant credit risk on cash and cash equivalents. Inventories Inventories of computer software held for resale, are stated at the lower of cost or market using the weighted average cost method. An allowance for inventory obsolescence is maintained to provide for an estimate of inventory items that have declined in value. Property and Equipment Property and equipment are carried at cost, less accumulated depreciation. Major additions and betterments are capitalized while replacements and maintenance and repairs that do not improve or extend the life of the respective assets are expensed. Leasehold improvements are amortized over the lesser of the term of the related lease or the estimated useful lives of the assets. When property is retired or otherwise disposed of, the related costs and accumulated depreciation are removed from the accounts and any gain or loss is reflected in operations. F-7 Depreciation and amortization of property and equipment is provided on the straight-line method over the following estimated useful lives of the assets Loss Per Share Loss per common share is computed on the basis of the weighted average number of common shares outstanding during the respective periods. Outstanding stock warrants, options and preferred shares are excluded from the computations as their effect would be anti-dilutive. During 1999, common shares were issued upon conversion of preferred shares. Had this conversion of preferred stock occurred on May 1, 1998, net loss per common share would have been $16.71 for 1999. Income Taxes Deferred income taxes are determined using the liability method under which deferred tax assets and liabilities are determined based upon differences between financial and tax basis of assets and liabilities. Fair Value of Financial Instruments Fair value of financial instruments are estimated to approximate the related book value, unless otherwise indicated, based on market information available to the Company. Impairment of Long-Lived Assets Impairment losses are recorded on long-lived assets and certain identifiable intangible assets held and used in operations whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Use of Estimates In preparing financial statements in conformity with generally accepted accounting principles, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the 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. F-8 2. ACCOUNTS RECEIVABLE AND CREDIT RISK The Company's trade receivables at April 30, 2000 and 1999 are primarily due from an ex-employee unsecured loan and from major computer software distributors. The Company believes it is not exposed to significant credit risk. 3. INVENTORIES Included in the accompanying April 30, 1998 balance sheet is inventory of computer software at a carrying value of $50,000 which was management's estimate of its net realizable value. At April 30, 1999, the entire amount of unsold inventory was written off. 4. NOTE RECEIVABLE-RELATED PARTY During fiscal 1999, the Company sold shares of Wincroft, Inc. to a Company affiliated with the President and Chief Executive Officer. The note is unsecured, due on demand and bears interest at 6%. The note was written off during fiscal 2000. 5. INVESTMENT IN AFFILIATE In May, 1997, the Company acquired 80% of the outstanding stock of Alexander Mark Investments, USA, Inc. (which later changed its name to Wincroft, Inc.). In March, 1998, the Company exchanged its shares in Alexander Mark Investments, USA, Inc. for 8% preferred shares of Forsam Venture Funding, Inc. An officer of the Company is a director of Forsam. The carrying amount of the investment is $80,388. The investment was written off during fiscal 1999. On March 31, 1998, the Company's wholly owned subsidiary, Third Planet Publishing, Inc. sold all right, title and interest in VideoTalk product for $7,002,056 which was paid by issuance of common and preferred stock valued at $5,002,056 and a promissory note for $2,000,000. On June 29, 1998, the Company agreed to satisfy the promissory note for preferred stock and the Company is treating the transaction as if it accrued at year end. This investment was accounted for using the equity method because the Company owned 20% of Wincroft, Inc. The investment had been valued at the net book value of the assets transferred, which is $1,065,582. During fiscal 1999, the Company sold its shares at a loss of $841,419. F-9 6. INCOME TAXES The Company had no current State or Federal income tax expense for each of the years ended April 30, 2000 and 1999. Deferred tax assets and liabilities are determined based on the difference between currently enacted tax rates. Deferred tax expense or benefit is the result of the changes in deferred tax assets and liabilities. Deferred income taxes arise principally from the temporary differences between financial statement and income tax recognition of allowance for doubtful accounts, note receivable allowance, investment valuation adjustments, inventory reserve and from net operating losses. The components of deferred taxes at April 30, in the accompanying balance sheets are summarized below: 2000 1999 Note receivable allowance 680,000 651,000 Investment valuation adjustment 123,000 Capital loss carryforward 32,000 323,000 Net operating loss carryforward 11,900,000 9,520,000 Less valuation allowance 12,900,000)(10,617,000) Deferred tax asset-net $ - $ - At April 30, 2000, the Company has approximately $26,000,000 of unused Federal net operating loss carryforwards, which expire in the years 2003 through 2013. Approximately $640,000 of the net operating loss carryforwards for tax purposes are limited due to statutory changes in the tax law in connection with the change in more than 50% ownership of the Company in 1988. Because of statutory requirements in the law, that portion of the net operating loss carryforward applicable to the period prior to the ownership change is limited to use of approximately $35,800 per year until it expires. As the net operating losses expire, at a minimum, approximately $425,000 of the tax net operating loss carryforward will not be available for the Company's future use. F-10 7. STOCKHOLDERS' EQUITY Preferred Stock The Company has 100,000,000 authorized shares of $.01 par value preferred stock with rights and preferences as designated by the board of directors at the time of issuance. The Company has the following series of preferred stock issued and outstanding at April 30, 2000: Number of Shares Series of Authorized Issued and Preferred Stock Outstanding A 2,000 - B 75,000 - C 50,000 - D 66,134 - E 108,056 - F 15,000 - BB 1,000,000 - G 5,333,333 - H 17,000,000 - I 10,000,000 - J 60,000,000 - K 412,000 - L 500,000 - TOTAL 94,061,523 - Series E preferred shares owned by a trust affiliated with the President of the Company are entitled to receive a cumulative dividend equivalent to $1,600 per month. Dividends in the amount of $4,800 were declared and paid each during the years ended April 30, 1999. Series H preferred shares ("Series H") are entitled to receive a dividend of 9% payable quarterly. The Series H are convertible to common shares at twenty percent off the closing price of the common shares. Series L preferred shares ("Series L") are entitled to receive a cumulative dividend of 7%, payable in common shares of the Company. The Series L are convertible to common shares at twenty percent off the closing price of the common shares. All shares will automatically be converted into common shares two years after issuance. Any split or combination of common shares requires a simultaneous split or combination of each series of preferred shares and visa versa. Upon liquidation or dissolution of the Company, holders of each series of preferred shares are entitled to receive, to the extent of their par value, pro rata with other preferred shareholders and before holders of common shares, all assets legally available for distribution to stockholders. Each series of preferred shares issued as of fiscal year-end is nonvoting. F-11 8. STOCK OPTIONS The Company adopted the 1991 Employee Stock Option Plan (the Plan) in April 1992, reserving 3,750 shares of the Company's common stock for issuance upon the exercise of options granted under the Plan. On April 30, 1993, the board amended and the shareholders approved to increase the number of common shares to 16,250 available for issuance under this plan. The options may be purchased as Incentive Stock Options at 100% of fair market value of the common stock or as supplemental stock options at not less than 85% of the fair market value of the common stock at the date of grant. The terms of the options under the Plan may not exceed 10 years. No options may be granted under the Plan after April, 2002. The Company has determined to use the 1991 Employee Stock Option Plan for non-employee directors and has amended the Plan to specifically cover directors. Other than a name change to the 1991 Outside Director Stock Option Plan and as set out above, the Plan will otherwise stay the same. In October 1996 the Company adopted the 1996 Stock Option Plan. At that time the Company canceled all outstanding options from the 1991 plan and granted the equal number of options from the 1996 plan. The plan reserves 200,000 shares of the Company's common stock upon exercise of the options granted under the plan. The exercise price for the options is equal to the Fair Market Value of a share of Common Stock on the Grant Date. The per share exercise price of any option granted to a person who at the time of grant owns stock possessing more than 10% of the total combined voting power of all classes of stock of the Company or any parent or subsidiary corporation of the Company must be at least 110% of the fair market value of a share of the Company's common stock on the date of grant, and the term of such option cannot exceed five years. The term of the options under the 1996 plan may not exceed 10 years. No options may be granted under the Plan after October 2006. During 1997, the exercise price of the options granted under the 1991 and 1996 plans was changed to $5.00 per share. Under the 1996 plan, 175,000 options were granted to the President of the Company, however he was not eligible for options under the 1991 plan. An additional 3,500 options were granted to officers during fiscal 1997. Outstanding stock options outside the Plan were nil and 86,250 at April 30, 2000 and 1999, F-12 The following schedule summarizes the changes in the Plans: 2000 1999 Options outstanding at 282,375 282,375 beginning at year Granted Exercised Canceled (86,250) Options outstanding at end of year 196,125 282,375 Options execrable at end of year 196,125 282,375 9. RELATED PARTY TRANSACTIONS On February 24, 1999 in order to provide cash and future stream of cash flow the Company sold to Texas Country Gold Development, Inc., a company affiliated with its President, 700,000 shares of Wincroft for $87,500 payable $1,000 in cash and in a note yielding 6%. The Company owned 21,495 shares of Forme Capital's Series A, 10% Noncumulative Preferred Stock, 50,000 shares of Series B, 10% Non-cumulative Preferred Stock and 466,571 shares of Series C, 10% Non-cumulative Preferred Stock. The preferred shares have no voting rights, pay dividends at the discretion of Forme's board of directors, and have priority for payment upon dissolution of Forme over Forme's common stock. The Company received dividends of $4,800 from Forme Capital during fiscal year 1999. During fiscal year 2000, the Company returned the shares to Forme Capital for $5,812. 10. CONTINGENCIES Litigation During the ordinary course of business, the Company is involved in legal proceedings and regulatory inquiries which management does not expect to have a material effect on the financial position of the Company. Going Concern The accompanying financial statements have been prepared assuming that the company will continue as a going concern. The company has had recurring operating losses for the past several years and is dependent upon financing to continue operations. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. It is management's plan to find an operating company to merge with, thus creating necessary operating revenue. F-13 Item 8. Disagreements on Accounting and Financial Disclosure Lane Gorman Trubitt, L.L.P. was dismissed as the Company's independent auditors effective May 22, 1998. During the past three years, and the interim period ending May 22, 1998, there were no disagreements between the Company and the auditors regarding any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure. Larry O'Donnell, CPA has been appointed effective May 22, 1998 to act as the auditor for the Registrant. The change was made to save the Company money. PART III Item 9. Directors and Executive Officers of the Registrant The following persons serve as directors and/or officers of the Company as of July 28, 1999: Name Age Position Period Served Term Expires Daniel Wettreich 48 Chairman, September 16, 1988 Next Annual President, Meeting Director Allan S. Wolfe 67 Director May 24, 1993 Next Annual Meeting Daniel Wettreich Daniel Wettreich is Chairman, President and Director of the Company(1) since September 1988. Additionally, he currently holds directors positions in the following public companies: Forme Capital, Inc., Wincroft, Inc., and Malex, Inc. which are dormant companies seeking merger opportunities. From July 1996 to July 1998, he was a Director of Constable Group plc (formerly Meteor Technology plc), a United Kingdom public company(3). In July 1993, he was appointed Director of Goldstar Video Corporation(2) following an investment by the Company. Mr. Wettreich has a Bachelor of Arts in Business Administration from the University of Westminster, London, England. Allan S. Wolfe Allan S. Wolfe has been a Director of the Company since May, 1993. He is a director of Palm Desert Art, Inc., formerly Database Technologies, Inc., a public company now involved with art galleries, from May 1986 to the present. He is also, since 1984, a director and Chief Executive Officer of Pathfinder Data Group ("PDG"), a database company. A subsidiary of PDG, Pathfinder Data, Inc., filed for protection from creditors under Chapter 11 and has since been converted to Chapter 7. (1) A subsidiary, Camelot Entertainment, Inc., filed Chapter 7 liquidation in January 1995. (2) Goldstar Video filed for protection from creditors pursuant to Chapter 11 in October 1993, and has converted to a liquidation proceeding. (3) A subsidiary, Meteor Payphones Ltd and subsidiaries filed for voluntary liquidation in March 1998. Constable Group plc filed for voluntary liquidation in July 1998. Item 10. Executive Compensation The following table lists all cash compensation exceeding $100,000 paid to Company's executive officers for services rendered in all capacities during the fiscal year ended April 30, 1999. No bonuses were granted to any officer, nor was any compensation deferred. SUMMARY COMPENSATION TABLE Annual Long-Term Compensation Compensation Awards Pa YOUTS Restr Name and Othe icted Options/ LT All Principal Year Salary B r Stock SARs IP Other Position o Annu Award Pa Compen n al (s) yo sation u Comp ut s ensa s tion Daniel 1997 $250,000 - - - 175,000 $(1) Wettreich 1998 $250,000 - - - 100,000 - $(1) Chairman and 1999 $ 52,083 - - - (275,000 - $(1) 2000 $ - - $ - CEO (1) - - - - (1) In July 1995, Mr. Wettreich became an employee of Company and Mr. Wettreich entered into an employment contract with Company. In July 1998 Mr. Wettreich agreed to terminate his contract with no cost to the Company. In April 1999 he surrendered his options to the Company with no cost to the Company. Directors of the Company are reimbursed for reasonable expenses incurred in attending meetings of the Board of Directors. Company has no compensatory plans or arrangements whereby any executive officer would receive payments from the Company or a third party upon his resignation, retirement or termination of employment, or from a change in control of Company or a change in the officer's responsibilities following a change in control. On July 1, 1995, Company entered into an employment contract with Mr. Wettreich whereby he was employed as Chairman, Chief Executive Officer and President of the Company for a period of ten years at an annual salary of $250,000 and a cash bonus equal to 5% of the Company's annual profits before taxation. In the event of Mr. Wettreich's death during the term of the agreement, Company will pay annual death benefits of $250,000 for a period of four years. Mr. Wettreich may terminate his employment after the date of a change in control of the Company. A change in control is defined as any person other than Mr. Wettreich or his family interests becomes beneficial owner, directly or indirectly of common stock of the Company representing 30% or more of the Company's issued and outstanding common stock or if the Incumbent Board as defined, ceases to constitute a majority of the board of directors. If Mr. Wettreich terminates his employment after a change of control in the company, he shall be paid (i) the base salary and any bonuses payable to him under the agreement or (ii) an amount equal to the product of the annual base salary and bonus paid to Mr. Wettreich during the year preceding the termination date multiplied by five whichever of (i) or (ii) is more. In the circumstances whereby Mr. Wettreich terminates his employment for good reason, as defined, he will receive payments in accordance with the payments received if termination occurs after a change of control of the Company. In July 1998 Mr. Wettreich was terminated along with all the other employees of the Company and Mr. Wettreich agreed to waive any outstanding obligations owed by Registrant to him under his employment contract. Item 11. Security Ownership of Certain Beneficial Owners and Management The following table sets forth as of July 16, 1999 information known to the management of the Company concerning the beneficial ownership of Common Stock by (a) each person who is known by the Company to be the beneficial owner of more than five percent of the shares of Common Stock outstanding, (b) each director at that time, of the Company (including principal directors of subsidiaries) owning Common Stock, and (c) all directors and officers of the Company (including principal directors of subsidiaries) as a group (2 persons). Name and Address of Amount and Nature of Percent Beneficial Owner Beneficial Ownership of Class Daniel Wettreich 1,345,295 (1) 21.4% 6959 Arapaho Road, Suite 122 Dallas, Texas 75248 Allan Wolfe 10,250 (2) * 390 South River Road Suite 5 Bedford, NH 03110 All Officers and Directors 1,345,295 (1)(2) 21.4% as a group (2 persons) * Under 0.1% Forsam Venture Funding, Inc. 1,345,295 (1) 21.4% 6959 Arapaho Road, Suite 122 Dallas, Texas 75248 (1) 1,345,295 of these are Preferred Stock , Series J, which have voting rights, and are owned by Forsam Venture Funding, Inc., (_Forsam_ ) a Delaware corporation of which, Mr. Wettreich is a director and officer. Mr. Wettreich has disclaimed any beneficial interest in the shares owned by Forsam. (See Item 13. Certain Relationships and Related Transactions). (2)Includes an option to purchase 6,625 shares granted to Allan Wolfe, which option is not exercised. Item 12. Certain Relationships and Related Transactions On February 24, 1999 in order to provide cash and future stream of cash flow the Company sold to Texas Country Gold Development, Inc., a company affiliated with its President, 700,000 shares of Wincroft for $87,500 payable $1,000 in cash and in a note yielding 6%. On May 20, 1997 Adina, Inc. subscribed for (post reverse) 1,345,295 restricted Preferred Shares, Series J of the Company with payment by the transfer of 6,029,921 restricted common shares of Alexander Mark Investments (USA), Inc. to the Company. 892,215 of the Preferred Shares were issued upon execution of the Agreement and 453,080 were subsequently issued as deferred consideration. The Preferred Shares have one vote per share and vote with the common shares, are non convertible, non-yielding and are subordinate to outstanding preferred shares but have a liquidation preference over common shares. On April 18, 1998 Adina sold the Preferred Shares, Series J to Forsam Venture Funding, Inc., a company of which Mr. Wettreich is a director and officer. Stock Transfer Company of America, Inc., (_ STCA_ ) a company affiliated with the President of the Company provided services during the year ended April 1999, and 1998 as a securities transfer agent. A total of $1,000, and $18,855 were paid by Company for these services. In the opinion of the Board of Directors, the terms of these transactions were as fair to the company as could have been made with an unaffiliated party. Additionally, STCA received management services from the Company and paid $6,000 per month starting in November 1997 until April 30, 1998. Until March 1998 the Company leased 10,000 square feet of offices from Forme Capital, Inc., a company affiliated with the President of the Company. Total rent paid during fiscal 1998 and 1997 was $135,383 and $80,000, respectively. The lease agreement and transactions related thereto were approved by a vote of Company's shareholders. In September 1997 the lease was terminated by mutual consent and the Company paid approximately $17,000 on a month to month basis thereafter. In February, 1998 the Company vacated the premises and consolidated its offices at 2415 Midway Road. The Company surrendered the Midway lease to the landlord in July 1998 for $39,781. During fiscal 1998 and 1997, Company received dividend payments from Forme Capital, Inc., Preferred Shares Series C in the amount of $46,657 for 1998 and $46,657 for 1997. On January 17, 1996, the Company's disinterested directors approved a secured loan to the Corporate Secretary in the amount of $75,156to exercise options to purchase Company stock. This loan bears interest at a rate 6% per annum. The Company agreed to accept Company stock in settlement of the loan. On August 1, 1996, the Company's disinterested directors approved a secured loan to the Corporate Secretary in the amount of $14,000. This loan bears interest at a rate of 6% per annum and was repaid as of January 31, 1997. On September 25, 1996 the Company's disinterested directors approved a secured loan to the President of the Company in the amount of $1,800,000. This loan bears interest at a rate of 6% per annum. On March 4, 1997, the Company acquired the US and Canadian rights to PCAMS software a payphone contract and management system software from Meteor Technology, plc payable by the cancellation of #2,000,000 of loan stock owed to the Company by Meteor and #500,000 by the issuance by the Company to Meteor of 80,960 restricted common shares. Mr. Wettreich and Ms. Fitzgerald who were directors of both companies at the time did not participate in any directors votes in relation to this transaction. On May 11, 1998 the PCAMS software was sold back to Meteor for #70,000 as the Company did not have sufficient funds to market the software and was restricted in its ability to sublicense the software. On May 20, 1997, the Company's subsidiary Third Planet amended the terms of its existing distribution agreement with DigiPhone International a subsidiary of Meteor Technology plc, to market exclusively all TPP products on a worldwide basis. Mr. Wettreich and Ms. Fitzgerald who were directors of these companies at the time did not participate in any directors votes in relation to this transaction. In May, 1997, the Company accepted a Preferred Share, Series J stock subscription by Adina, Inc., a public company of which Mr. Wettreich is a director and officer. Mr. Wettreich did not participate in any directors vote in respect to this transaction. The consideration for the issuance of the Preferred Shares was the transfer of eighty (80%) percent of Alexander Mark Investments (USA), Inc. a public company whose major asset is fifty-seven (57%) percent of the outstanding ordinary shares of Meteor. The Preferred Shares, Series J have one vote per share voting with the common shares, have a liquidation preference over the common shares but are subordinate to the outstanding Preferred Shares, are not convertible and pay no dividends. They also are subject to a forward or reverse split in any instances for which the common shares are subject to a forward or reverse split on the exact same basis. On May 30, 1997, the Company subscribed for #500,000 1997-2007 10% unsecured redeemable loan stock of Meteor by paying cash. Mr. Wettreich and Ms. Fitzgerald who were directors of both companies at the time, did not participate in any directors votes in relation to this transaction. On March 20, 1998 Registrant sold to Forsam Venture Funding, Inc.3,837,706 shares in AMI for its then net asset value per share of $24,233 payable by the issuance by Forsam of 8% Preferred Shares. Mr. Wettreich is a director of Forsam and did not participate in any director vote relating to this transaction. At the same time Registrant sold to Abuja Consultancy, Ltd. 2,192,265 shares in Alexander Mark Investments (USA), Inc. for $13,830 cash. These transactions represented Registrants total shareholding in Alexander Mark Investments (USA), Inc. On March 20, 1998 Registrant sold to Abuja Consultancy, Ltd. 1,149,464 shares in Meteor Technology plc representing its total shareholding in that company for a price calculated at the then pro rata net asset value of Meteor amounting to $16,187 cash. On March 23, 1998, Registrant acquired from Alexander Mark Investments (USA), Inc. 43,000 Preferred Shares, Series B of Forsam Venture Funding for $43,000 cash. The Company has no compensatory plans or arrangements whereby any executive officer would receive payments from the Company or a third party upon his resignation, retirement or termination of employment, or from a change in control of the Company or a change in the officer's responsibilities following a change in control. Under the 1996 Stock Option Plan or under the Company's 1991 Outside Directors Stock Option Plan options granted under these plans contain provisions pursuant to which the unvested portions of outstanding options become immediately exercisable and fully vested upon a merger of the Company in which the Company's stockholders do not retain, directly or indirectly, at least a majority of the beneficial interest in the voting stock of the Company or its successor, if the successor corporation fails to assume the outstanding options or substitute options for the successor corporation's stock to replace the outstanding options. The outstanding options will terminate to the extent they are not exercised as of consummation of the merger, or assumed or substituted for by the successor corporation. PART IV Item 13.Exhibits, Financial Statement Schedules, and Reports on Form 8-K (a) (1) The following financial statements are included herein for fiscal year ended April 30, 1999. Index to Consolidated Financial Statements Page Report of Independent Auditors - 1999 and 1998 F-1 Consolidated Financial Statements Balance Sheet - April 30, 1999 F-2 Statements of Operations and Other Comprehensive Income for the years ended April 30, 1999 and 1998 F-3 Statements of Stockholders' Equity for the years ended April 30, 1999 and 1998 F-4 Statements of Cash Flows for the years ended April 30, 1999 and 1998 F-5 and F-6 Notes to Consolidated Financial Statements F-7 through F-18 (a) (2) Consolidated Schedule - (a) (3) Exhibits included herein: 3(a) Articles of Incorporation Incorporated by reference to Form 10 Registration Statement filed on June 23, 1976. 3(b) Bylaws Incorporated by Reference as immediately above. 10 (b) 1991 Outside Directors' Stock Option Plan Incorporated by reference to the Proxy Statement for April 13, 1992 Annual Meeting of Shareholders and the Proxy Statement for January 3, 1998 Annual Meeting of Shareholders. 1996 Employee Stock Option Plan Incorporated by reference to the Proxy Statement for January 3,1998 Annual Meeting of Shareholders 22(a) Subsidiaries (7) Reports on Form 8-K: Report filed on February 15, 1999 reporting Item 8. EXHIBIT 22(a) SUBSIDIARIES AS OF MAY 14, 1999 mrcdrom.com, inc. 100% SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. CAMELOT CORPORATION (Company) By: /s/Daniel Wettreich President Date: July 31, 2000 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Company and in the capacities and on the dates indicated. By: /s/Daniel Wettreich Director; President (principal executive officer and principal financial officer) Date: July 31, 2000 By: /s/Allan Wolfe Director Date: July 31, 2000