SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q



(Mark One)

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



For the quarterly period ended June 30, 2012



OR



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

For the transition period from       to



Commission file number 000-54426



PIVOTAL GROUP, INC.

(Exact name of registrant as specified in
its charter)





|Delaware                        |  | 45-1876246                          
|------------------------------- |  | ------------------------------------
|(State or other jurisdiction of |  | (I.R.S. Employer Identification No.)
|incorporation or organization)  |  |                                     





3145 Green Valley Road

Birmingham, Alabama 35243

(Address of principal executive offices)
(zip code)



205-977-7755

(Registrant's telephone number, including
area code)



Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements
for the past 90 days.

x Yes  ̈ No



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



|Large Accelerated filer    ̈                 | Accelerated filer    ̈        
|------------------------------------------- | -----------------------------
|Non-accelerated filer    ̈                   | Smaller reporting company   x
|(do not check if smaller reporting company) |                              



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



Indicate the number of shares outstanding
of each of the registrant's classes of common stock as of the latest practicable date.



|Class                           | Outstanding at August 1, 2012
|------------------------------- | -----------------------------
|Common Stock, par value $0.0001 | 6,950,000 shares             



|Documents incorporated by reference: | None
|------------------------------------ | ----











PART I



ITEM 1. FINANCIAL STATEMENTS





FINANCIAL STATEMENTS





|Balance Sheets as of June 30, 2012 (unaudited) and December 31, 2011                                                                                       | 1  
|---------------------------------------------------------------------------------------------------------------------------------------------------------- | ---
|                                                                                                                                                           |    
|Statements of Operations for the three and six Months ended June 30, 2012, and the period from
    April 20, 2011 (Inception) to June 30, 2012 (unaudited) | 2  
|                                                                                                                                                           |    
|Stat Statements of Cash Flows for the Six Months ended June 30, 2012 and the period from April 20, 2011 (Inception) to June 30, 2012 (unaudited)           | 3  
|                                                                                                                                                           |    
|Notes to  Financial Statements (unaudited)                                                                                                                 | 4-7













Pivotal Group, Inc.

(formerly known as DRIFTWOOD ACQUISITION
CORPORATION)

(A DEVELOPMENT STAGE COMPANY)

BALANCE SHEETS





|                                                                                                        |  | June 30, 2012 |        |   | December 31, 2011 |  
|------------------------------------------------------------------------------------------------------- |  | ------------- | ------ | - | ----------------- | -
|                                                                                                        |  | (unaudited)   |        |   |                   |  
|ASSETS                                                                                                  |  |               |        |   |                   |  
|Current Assets                                                                                          |  |               |        |   |                   |  
|Cash                                                                                                    |  | $             | 4,500  |   |                   | $
|TOTAL ASSETS                                                                                            |  | $             | 4,500  |   |                   | $
|                                                                                                        |  |               |        |   |                   |  
|                                                                                                        |  |               |        |   |                   |  
|LIABILITIES AND STOCKHOLDERS' EQUITY                                                                    |  |               |        |   |                   |  
|                                                                                                        |  |               |        |   |                   |  
|Current Liabilities                                                                                     |  |               |        |   |                   |  
|Accrued liabilities                                                                                     |  |               |        |   |                   | $
|                                                                                                        |  |               |        |   |                   |  
|Total Liabilities                                                                                       |  |               | -      |   |                   |  
|                                                                                                        |  |               |        |   |                   |  
|                                                                                                        |  |               |        |   |                   |  
|Stockholders' Equity                                                                                    |  |               |        |   |                   |  
|Preferred stock, $0.0001 par value, 20,000,000 shares authorized; none issued and outstanding           |  |               | -      |   |                   |  
|Common stock, $0.0001 par value, 100,000,000 shares authorized; 6,950,000 shares issued and outstanding |  |               | 695    |   |                   |  
|Additional paid-in capital                                                                              |  |               | 8,498  |   |                   |  
|Accumulated deficit                                                                                     |  |               | (4,693 | ) |                   |  
|                                                                                                        |  |               |        |   |                   |  
|Total Stockholders' Equity                                                                              |  |               | 4,500  |   |                   |  
|TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                                              |  | $             | 4,500  |   |                   | $



The accompanying notes are an integral part
of these financial statements



1









Pivotal Group, Inc.

(formerly known as DRIFTWOOD ACQUISITION
CORPORATION)

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF OPERATIONS

(unaudited)







|                                            |  | For the three 
    months ended  June 30,  2012 |           |   |  | For the six 
months
    ended  June 30, 2012 |   |           |   | For the period from 
    April 20, 2011  (inception) to 
June 30,  2012 | 
|------------------------------------------- |  | ----------------------------------------------- | --------- | - |  | -------------------------------------------- | - | --------- | - | ----------------------------------------------------------------------- | 
|                                            |  |                                                 |           |   |  |                                              |   |           |   |                                                                         | 
|Revenue                                     |  |                                                 | -         |   |  |                                              |   | -         |   |                                                                         | 
|Cost of revenue                             |  |                                                 | -         |   |  |                                              |   | -         |   |                                                                         | 
|Gross Profit                                |  |                                                 | -         |   |  |                                              |   | -         |   |                                                                         | 
|                                            |  |                                                 |           |   |  |                                              |   |           |   |                                                                         | 
|Operating expenses                          |  | $                                               | 2,600     |   |  |                                              | $ | 3,350     |   |                                                                         | 
|Loss before income tax                      |  |                                                 | -         |   |  |                                              |   | (3,350    | ) |                                                                         | 
|Income taxes                                |  |                                                 | -         |   |  |                                              |   | 0         |   |                                                                         | 
|Net loss                                    |  | $                                               | (2,600    | ) |  |                                              | $ | (3,350    | ) |                                                                         | 
|                                            |  |                                                 |           |   |  |                                              |   |           |   |                                                                         | 
|                                            |  |                                                 |           |   |  |                                              |   |           |   |                                                                         | 
|Loss per share - basic and diluted          |  | $                                               | (0.00     | ) |  |                                              | $ | (0.00     | ) |                                                                         | 
|                                            |  |                                                 |           |   |  |                                              |   |           |   |                                                                         | 
|                                            |  |                                                 |           |   |  |                                              |   |           |   |                                                                         | 
|Weighted average shares - basic and diluted |  |                                                 | 9,112,637 |   |  |                                              |   | 9,112,637 |   |                                                                         | 



The accompanying notes are an integral part of these
financial statements



2









Pivotal Group, Inc.

(formerly known as DRIFTWOOD ACQUISITION
CORPORATION)

(A DEVELOPMENT STAGE COMPANY)

STATEMENTS OF CASH FLOWS

(unaudited)





|                                                       |  | For the six  months ended June 30, 2012 |        |   | For the period from April 
    20, 2011 (inception) to  June 30, 2012 |  
|------------------------------------------------------ |  | --------------------------------------- | ------ | - | --------------------------------------------------------------------- | -
|CASH FLOWS FROM OPERATING ACTIVITIES                   |  |                                         |        |   |                                                                       |  
|Net loss                                               |  | $                                       | (3,350 | ) |                                                                       | $
|Changes in Operating Assets and Liabilities            |  |                                         |        |   |                                                                       |  
|Accrued liabilities                                    |  |                                         | -      |   |                                                                       |  
|Net Cash Used in Operating Activities                  |  |                                         | (3,350 | ) |                                                                       |  
|                                                       |  |                                         |        |   |                                                                       |  
|CASH FLOW FROM FINANCING ACTIVITIES                    |  |                                         |        |   |                                                                       |  
|Proceeds from the issuance of common stock             |  |                                         | 5,100  |   |                                                                       |  
|Cash paid for redeemed shares                          |  |                                         | (1,950 | ) |                                                                       |  
|Proceeds from stockholders' additional paid-in capital |  |                                         | 2,700  |   |                                                                       |  
|Net Cash Provided by Financing Activities              |  |                                         | 5,850  |   |                                                                       |  
|                                                       |  |                                         |        |   |                                                                       |  
|Net Increase in Cash                                   |  |                                         | 2,500  |   |                                                                       |  
|                                                       |  |                                         |        |   |                                                                       |  
|Cash at Beginning of Period                            |  |                                         | 2,000  |   |                                                                       |  
|                                                       |  |                                         |        |   |                                                                       |  
|Cash at End of Period                                  |  | $                                       | 4,500  |   |                                                                       | $



The accompanying notes are an integral
part of these financial statements





3







Pivotal Group, Inc.

(formerly known as DRIFTWOOD ACQUISITION
CORPORATION)

(A DEVELOPMENT STAGE COMPANY)

Notes
to the Financial Statements

(unaudited)



NOTE 1 – NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES



NATURE OF OPERATIONS



Pivotal Group, Inc. ("Pivotal”
or “the Company”), formerly known as Driftwood Acquisition Corporation (“Driftwood’), was incorporated
on April 20, 2011 under the laws of the State of Delaware to engage in any lawful corporate undertaking, including, but not limited
to, selected mergers and acquisitions. The Company has been in the developmental stage since inception and its operations to date
have been limited to issuing shares to its original shareholders. The Company will attempt to locate and negotiate with a business
entity for the combination of that target company with Pivotal. The combination normally will take the form of a merger, stock-for-stock
exchange or stock-for-assets exchange. In most instances the target company will wish to structure the business combination to
be within the definition of a tax-free reorganization under Section 351 or Section 368 of the Internal Revenue Code of 1986, as
amended. No assurances can be given that the Company will be successful in locating or negotiating with any target company. The
Company was formed to provide a method for a foreign or domestic private company to become a reporting company with a class of
securities registered under the Securities Exchange Act of 1934.



On January 30, 2012, the shareholders of
the Company and the Board of Directors unanimously approved the change of the Company’s name to Pivotal Group, Inc. and filed
such change with the State of Delaware. On February 1, 2012, new officers and directors were appointed and elected and the prior
officers and directors resigned, resulting in the change of control of the Company.



BASIS OF PRESENTATION



The
accompanying unaudited financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange
Commission (SEC) for interim financial information. Accordingly, they do not include all of the information and notes required
by U.S. GAAP for complete financial statements. The accompanying unaudited financial statements include all adjustments, composed
of normal recurring adjustments, considered necessary by management to fairly state our results of operations, financial position
and cash flows. The operating results for interim periods are not necessarily indicative of results that may be expected for any
other interim period or for the full year. These unaudited financial statements should be read in conjunction with the financial
statements and notes thereto included in our Annual Report on Form 10-K for the year ended December 31, 2011 (2011 Form 10-K) as
filed with the SEC.



USE OF ESTIMATES



The preparation of financial statements
in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities
and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues
and expenses during the reporting periods.  Actual results could differ from those estimates.



CONCENTRATION OF RISK



Financial instruments that potentially
subject the Company to concentrations of credit risk consist principally of cash. The Company places its cash with high quality
banking institutions. The Company did not have cash balances in excess of the Federal Deposit Insurance Corporation limit as of
June 30, 2012 and December 31, 2011.



4







Pivotal Group, Inc.

(formerly known as DRIFTWOOD ACQUISITION
CORPORATION)

(A DEVELOPMENT STAGE COMPANY)

Notes
to the Financial Statements

(unaudited)



INCOME TAXES



Under ASC 740, "Income Taxes",
deferred tax assets and liabilities are recognized for the future tax consequences attributable to temporary differences between
the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets
and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. Valuation allowances are established when it is more likely than not that
some or all of the deferred tax assets will not be realized. As of June 30, 2012 and December 31, 2011, there were no deferred
taxes.



LOSS PER COMMON SHARE



Basic loss per common share excludes dilution
and is computed by dividing net loss by the weighted average number of common shares outstanding during the period. Diluted loss
per common share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised
or converted into common stock or resulted in the issuance of common stock that then shared in the loss of the entity. As of June
30, 2012, there are no outstanding dilutive securities.



Fair Value of Financial
Instruments



The Company follows guidance for accounting
for fair value measurements of financial assets and financial liabilities and for fair value measurements of nonfinancial items
that are recognized or disclosed at fair value in the financial statements on a recurring basis. Additionally, the Company adopted
guidance for fair value measurement related to nonfinancial items that are recognized and disclosed at fair value in the financial
statements on a nonrecurring basis. The guidance establishes a fair value hierarchy that prioritizes the inputs to valuation techniques
used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical
assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs
(Level 3 measurements). The three levels of the fair value hierarchy are as follows:



• Level 1 inputs are quoted prices
(unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement
date.



• Level 2 inputs are inputs other
than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.



• Level 3 inputs are unobservable
inputs for the asset or liability.



The level in the fair value hierarchy within
which a fair measurement in its entirety falls is based on the lowest level input that is significant to the fair value measurement
in its entirety.



5







Pivotal Group, Inc.

(formerly known as DRIFTWOOD ACQUISITION
CORPORATION)

(A DEVELOPMENT STAGE COMPANY)

Notes
to the Financial Statements

(unaudited)



NOTE 2 - GOING CONCERN



The Company sustained losses from its inception
on April 20, 2011 to June 30, 2012. The Company had a net loss of $3,350 for the six months ended June 30, 2012 and has an accumulated
deficit of $4,693 as of June 30, 2012. The Company’s continuation as a going concern is dependent on its ability to generate
sufficient cash flows from operations to meet its obligations, which it has not been able to accomplish to date, and /or obtain
additional financing from its stockholders and/or other third parties.



These financial statements have been prepared
on a going concern basis, which implies the Company will continue to meet its obligations and continue its operations for the next
fiscal year. The continuation of the Company as a going concern is dependent upon financial support from its stockholders, the
ability of the Company to obtain necessary equity financing to continue operations, successfully locating and negotiate with a
business entity for the combination of that target company with the Company.



The Company’s management plans to
pay for all expenses incurred by the Company in 2012. There is no assurance that the Company will ever be profitable. The
financial statements do not include any adjustments to reflect the possible future effects on the recoverability and classification
of assets or the amounts and classifications of liabilities that may result should the Company be unable to continue as a going
concern.



NOTE 3 - RECENT ACCOUNTING PRONOUNCEMENTS



Adopted



In May 2011, the FASB issued ASU 2011-04,
“Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and International Financial
Reporting Standards (IFRS) of Fair Value Measurement – Topic 820.” ASU 2011-04 is intended to provide a consistent
definition of fair value and improve the comparability of fair value measurements presented and disclosed in financial statements
prepared in accordance with U.S. GAAP and IFRS. The amendments include those that clarify the FASB’s intent about the application
of existing fair value measurement and disclosure requirements, as well as those that change a particular principle or requirement
for measuring fair value or for disclosing information about fair value measurements. This update is effective for annual and interim
periods beginning after December 15, 2011. This ASU did not have a material impact on the Company’s financial statements.



Not Adopted



In December 2011, the FASB issued ASU No.
2011-11: Balance Sheet (topic 210): Disclosures about Offsetting Assets and Liabilities, which requires new disclosure requirements
mandating that entities disclose both gross and net information about instruments and transactions eligible for offset in the statement
of financial position as well as instruments and transactions subject to an agreement similar to a master netting arrangement.
In addition, the standard requires disclosure of collateral received and posted in connection with master netting agreements or
similar arrangements. This ASU is effective for annual reporting periods beginning on or after January 1, 2013, and interim periods
within those annual periods. Entities should provide the disclosures required retrospectively for all comparative periods presented.
We are currently evaluating the impact of adopting ASU 2011-11 on the consolidated financial statements.



6







Pivotal Group, Inc.

(formerly known as DRIFTWOOD ACQUISITION
CORPORATION)

(A DEVELOPMENT STAGE COMPANY)

Notes
to the Financial Statements

(unaudited)



The FASB
issued Accounting Standards Update (ASU) No. 2012-02—Intangibles—Goodwill and Other (Topic 350): Testing Indefinite-Lived
Intangible Assets for Impairment, on July 27, 2012, to simplify the testing for a drop in value of intangible assets such as
trademarks, patents, and distribution rights. The amended standard reduces the cost of accounting for indefinite-lived intangible
assets, especially in cases where the likelihood of impairment is low. The changes permit businesses and other organizations to
first use subjective criteria to determine if an intangible asset has lost value. The amendments to U.S. GAAP will be effective
for fiscal years starting after September 15, 2012. Early adoption is permitted. We are currently
evaluating the impact of adopting ASU 2012-02 on the consolidated financial statements.



Other recent accounting pronouncements
issued by the FASB (including its Emerging Issues Task Force), the American Institute of Certified Public Accountants, and the
United States Securities and Exchange Commission did not or are not believed by management to have a material impact on the Company’s
present or future financial statements.



NOTE 4 – STOCKHOLDERS’ EQUITY



The Company is authorized to issue 100,000,000
shares of common stock and 20,000,000 shares of preferred stock. As of June 30, 2012, 6,950,000 shares of common stock were issued
and outstanding and no preferred stock was issued and outstanding.



On April 25, 2011, the Company issued 20,000,000
common shares to two directors and officers for $2,000 in cash.



On February 1, 2012, the Company redeemed
an aggregate of 19,500,000 of the then 20,000,000 shares of outstanding stock at a redemption price of $.0001 per share for an
aggregate redemption price of $1,950.



On February 2, 2012, the Company issued
6,000,000 shares of its common stock at par for an aggregate of $600.



On March 12, 2012, the Company issued 450,000
shares of its common stock at $0.01 per share for an aggregate of $4,500 to various investors.



7









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



As of June 30, 2012,
Pivotal Group Inc. (formerly Driftwood Acquisition Corporation ("Pivotal" or the "Company") had not generated
revenues and had no income or cash flows from operations since inception and had accumulated a deficit of $4,693 and a net loss
of $3,350 for the six months ended June 30, 2012.



Pivotal has no operations
nor does it currently engage in any business activities generating revenues. Pivotal's principal business objective is to achieve
a business combination with a target company.



A combination will
normally take the form of a merger, stock-for-stock exchange or stock-for-assets exchange. In most instances the target company
will wish to structure the business combination to be within the definition of a tax-free reorganization under Section 351 or Section
368 of the Internal Revenue Code of 1986, as amended.



Pivotal is in discussions
with PKCCR, LLC, a limited liability company organized on December 19, 2011 under the laws of the State of Florida. PKCCR has been
in the developmental stage since inception. PKCCR intends to participate in the development of a conference center and resort in
Perdido Key, Florida. PKCCR, LLC intends to acquire and manage all goods and services pertaining to this project. PKCCR plans to
partner with travel agencies to help promote and schedule tour groups, align with local convention and visitors bureaus to assist
in targeting new and existing business travel opportunities and work closely with meeting and event planners to attract conferences,
tradeshows, association meetings, tournaments and special events.



No agreement has been
executed at the time of this Report, but the parties are in discussion of an exchange of all the membership interests in PKCCR
for stock of the Company thereby making the Company the sole member interest in PKCCR, LLC.



The members of PKCCR
are also the officers of the Company and the transaction would not be considered an arms--length transaction.



The Company's independent
auditors have issued a report raising substantial doubt about the Company's ability to continue as a going concern. At present,
the Company has no operations and the continuation of the Company as a going concern is dependent upon financial support from its
stockholders, its ability to obtain necessary equity financing to continue operations and/or to successfully locate and negotiate
with a business entity for the combination with a target company.



Management plans to
use their personal funds to pay all expenses incurred by the Company in 2012. There is no assurance that the Company will ever
be profitable. The financial statements do not include any adjustments to reflect the possible future effects on the recoverability
and classification of assets or the amounts and classifications of liabilities that may result should the Company be unable to
continue as a going concern.



8







Background



Pivotal was incorporated
on April 20, 2011 under the laws of the State of Delaware to engage in any lawful corporate undertaking, including, but not limited
to, selected mergers and acquisitions.



Pivotal has been in
the developmental stage since inception and its operations to date have been limited to filing a registration statement and issuing
shares of its common stock to the original shareholders and to the subsequent shareholders to whom control of the Company was transferred.
Pivotal has been formed to provide a method for a foreign or domestic private company to become a reporting company with a class
of securities registered under the Securities Exchange Act of 1934.



The Company registered
its common stock on a Form 10 registration statement filed pursuant to the Securities Exchange Act of 1934 (the "Exchange
Act") and Rule 12(g) thereof. The Company files with the Securities and Exchange Commission periodic and current reports under
Rule 13(a) of the Exchange Act, including quarterly reports on Form 10-Q and annual reports Form 10-K.



Tiber Creek Corporation,
a shareholder of the Company, entered into an agreement to assist the Company in locating a target company with which to enter
into a business combination and assist it in the preparation and filing of a registration statement for its securities and the
introduction to brokers and market makers.



It is anticipated that
any securities issued in a business combination would be issued in reliance upon exemption from registration under applicable federal
and state securities laws. In some circumstances, however, as a negotiated element of its transaction, the Company may agree to
register all or a part of such securities immediately after the transaction is consummated or at specified times thereafter. The
issuance of additional securities and their potential sale into any trading market which may develop in the Company's securities
may depress the market value of the Company's securities in the future if such a market develops, of which there is no assurance.



Revenues



The Company has received
no income, has had no operations nor expenses, other than Delaware state fees and legal and accounting fees as required for incorporation
and for the preparation of the Company's financial statements.



Results of Operations



As of June 30, 2012,
the Company had not generated revenues and had no income or cash flows from operations since inception and had accumulated a deficit
$4,693. The Company has no operations nor does it currently engage in any business activities generating revenues.



9







Off-Balance Sheet Arrangements



The Company has no
off-balance sheet arrangements that 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 deemed by our management to be material to investors.



Recent Accounting Policies



The recent material
accounting policies that may be the most critical to understanding of the financial results and conditions are discussed in the
unaudited financial statements.



ITEM 3. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK.



Information not required
to be filed by Smaller Reporting Companies.



ITEM 4. CONTROLS AND PROCEDURES.



Evaluation of Disclosure Controls and
Procedures.



Pursuant to Rule 13a-15(b)
under the Securities Exchange Act of 1934 ("Exchange Act"), the Company's management, under the supervision and with
the participation of the Chief Executive Officer and Chief Financial Officer, have evaluated the effectiveness of the Company's
disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) as of June 30, 2012, the end of the period
covered by this Quarterly Report on Form 10-Q.



Based upon that evaluation,
the Chief Executive Officer and Chief Financial Officer concluded that, as of June 30, 2012, the disclosure controls and procedures
were not effective. Disclosure controls and procedures means controls and other procedures that are designed to ensure that information
required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized
and reported within the time periods specified in the Securities and Exchange Commission's rules and forms. Disclosure controls
and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed
by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to management, including
the principal executive and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.



The Company's management
has identified material weaknesses in its internal control over financial reporting related to the following matters:





10









A lack of sufficient
segregation of duties. Specifically, this material weakness is such that the design over these areas relies primarily on defective
controls and could be strengthened by adding preventative controls to properly safeguard company assets.



A lack of sufficient
personnel in the accounting function due to the Company's limited resources with appropriate skills, training and experience to
perform certain tasks as it relates to financial reporting.



The Company's plan
to remediate those material weaknesses remaining is as follows:



Improve the effectiveness
of the accounting group by continuing to augment existing resources with additional consultants or employees to improve segregation
procedures and to assist in the analysis and recording of complex accounting transactions. The Company plans to mitigate the segregation
of duties issues by hiring additional personnel in the accounting department once it generates significantly more revenue,or raises
significant additional working capital.



Improve segregation
procedures by strengthening cross approval of various functions including quarterly internal audit procedures where appropriate.



Changes in Internal Control Over Financial
Reporting



Notwithstanding the
change in control there was no change in the Company's internal control over financial reporting that was identified in connection
with such evaluation that occurred during the period covered by this report that has materially affected, or is reasonably likely
to materially affect, the Company's internal control over financial reporting.



PART II



ITEM 1. LEGAL PROCEEDINGS



There are no pending,
threatened or actual legal proceedings in which the Company or any subsidiary is a party.



ITEM 2. UNREGISTERED SALES OF EQUITY
SECURITIES AND USE OF PROCEEDS



All shares of common
stock issued by the Company have been issued pursuant to an exemption from registration under Section 4(2) of the Securities Act
of 1933, as amended, as transactions by an issuer not involving any public offering.



11









During the past three
years, the Company has issued the following common shares:



|DATE             |  | NAME                    |  | SHARES |                               |  | CONSIDERATION |  
|---------------- |  | ----------------------- |  | ------ | ----------------------------- |  | ------------- | -
|                 |  |                         |  |        |                               |  |               |  
|April 25, 2011   |  | Tiber Creek Corporation |  |        | 10,000,000                    |  |               | $
|                 |  | (1)                     |  |        | (9,750,000 of which redeemed) |  |               |  
|                 |  |                         |  |        |                               |  |               |  
|April 25, 2011   |  | MB Americus LLC (2)     |  |        | 10,000,000                    |  |               | $
|                 |  |                         |  |        | (9,750,000 of which redeemed) |  |               |  
|                 |  |                         |  |        |                               |  |               |  
|February 2, 2012 |  | M. Duane Lewis          |  |        | 1,500,000                     |  |               | $
|                 |  |                         |  |        |                               |  |               |  
|                 |  |                         |  |        |                               |  |               |  
|February 2, 2012 |  | Tom Moore               |  |        | 1,500,000                     |  |               | $
|                 |  |                         |  |        |                               |  |               |  
|Feruary 2, 2012  |  | Robert Ritch            |  |        | 1,500,000                     |  |               | $
|                 |  |                         |  |        |                               |  |               |  
|February 2, 2012 |  | P. K. Smartt            |  |        | 1,500,000                     |  |               | $
|                 |  |                         |  |        |                               |  |               |  
|March 12, 2012   |  | Various investors       |  |        | 450,000                       |  |               | $



(1) James M. Cassidy is the sole shareholder
and director of Tiber Creek Corporation, a Delaware corporation, and Mr. Cassidy may be deemed to be the beneficial owner of the
shares of stock owned by Tiber Creek Corporation.



(2) James McKillop is the sole principal
of MB Americus LLC, a California limited liability corporation. Mr. McKillop is deemed to be the beneficial owner of the shares
of stock owned by MB Americus LLC.



ITEM 3. DEFAULTS UPON SENIOR SECURITIES



Not applicable.



ITEM 4. SUBMISSION OF MATTERS TO A VOTE
OF SECURITY HOLDERS



There were no matters
submitted to a vote of the security holders during the quarter covered by this report.



ITEM 5. OTHER INFORMATION



(a) 	Robert Ritch,
a member of the Company's Board of Directors, resigned his position as a director of the Company. Mr. Ritch resigned for personal
reasons and there was no disagreement with the Company. No replacement has been named for Mr. Ritch.



(b) Item 407(c)(3)
of Regulation S-K:



During the quarter
covered by this Report, there have not been any material changes to the procedures by which security holders may recommend nominees
to the Board of Directors.



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ITEM 6. EXHIBITS



|(a)  | Exhibits                                                                                                                           
|---- | -----------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                    
|31.1 | Certification of the Chief Executive Officer and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 
|32.1 | Certification of the Chief Executive Officer and Chief Financial Officer \pursuant to Section 906 of the Sarbanes-Oxley Act of 2002



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.



|                       | PIVOTAL GROUP, INC.       
|---------------------- | --------------------------
|                       |                           
|                       | By:    /s/ Mr. Duane Lewis
|                       | President                 
|                       |                           
|Dated: August 10, 2012 |                           



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