UNITED
      STATES


SECURITIES
      AND EXCHANGE COMMISSION


WASHINGTON,
      D.C. 20549





FORM
      10-KSB





[X]
            ANNUAL
              REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
              1934For
              the fiscal year ended October
              31, 2007[  ]
            TRANSITION
              REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
              ACTFor
                the transition period from _________ to ________Commission
                file number 333-140806





CAPITAL
                CITY ENERGY
                GROUP, INC.(Name
                of small business issuer in its charter)  Nevada
              20-5131044(State
                  or other jurisdiction of incorporation or organization)
              (I.R.S.
                  Employer Identification No.)11741
                  Costa Blanca
                  Ave.  Las Vegas, NV
              89135(Address
                  of principal executive offices)
              (Zip
                  Code)Issuer’s
                  telephone number:  (702)
                  592-8737Securities
                registered under Section 12(b) of the Exchange Act:Title
                  of each class
              Name
                  of each exchange on which registeredNone
              Not
                  ApplicableSecurities
                registered under Section 12(g) of the Exchange Act:None
                (Title
                  of class)


Check
      whether the Issuer (1) filed all reports required to be filed by Section 13
      or
      15(d) of the Securities Exchange Act during the past  12 months (or
      for such shorter period that the registrant was required to file such reports),
      and (2) has been subject to such filing requirements for the past 90
      days.    Yes
      [X]       No
      [   ]





Check
      if
      disclosure of delinquent filers in response to Item 405 of Regulation S-B is
      not
      contained in this form, and no disclosure will be contained, to the best of
      registrant’s knowledge, in definitive proxy or information statements
      incorporated by reference in Part III of this Form 10-KSB or any amendment
      to
      this Form 10-KSB [   ]





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





State
      issuer’s revenue for its most recent fiscal year.  $1,893





State
      the
      aggregate market value of the voting and non-voting common equity held by
      non-affiliates computed by reference to the average bid and asked price of
      such
      common equity, as of a specified date within the past 60
      days.    Not Available





State
      the
      number of shares outstanding of each of the issuer’s classes of common equity,
      as of the latest practicable date.   9,960,000 Common Shares as
      of October
      31, 2007





Transitional
      Small Business Disclosure Format (Check One):  Yes: __; No X


Table
          of Contents





TABLE
      OF
      CONTENTS





PagePART
                IItem
                1.
            Description
                of Business
            3Item
                2.
            Description
                of Property
            4Item
                3.
            Legal
                Proceedings
            4Item
                4.
            Submission
                of Matters to a Vote of Security
                Holders
            4PART
                IIItem
                5.
            Market
                for Common Equity and Related Stockholder Matters and
                Small Business Issuer Purchases of Equity Securities
            5Item
                6.
            Management’s
                Discussion and Analysis or Plan of
                Operation
            7Item
                7.
            Financial
                Statements
            10Item
                8.
            Changes
                In and Disagreements With Accountants on Accounting and
                Financial Disclosure
            11Item
                8A.
            Controls
                and Procedures
            11Item
                8B.
            Other
                Information
            12PART
                IIIItem
                9.
            Directors,
                Executive Officers, Promoters and Control Persons;
                Compliance With Section 16(a) of the Exchange Act
            12Item
                10.
            Executive
                Compensation
            15Item
                11.
            Security
                Ownership of Certain Beneficial Owners and Management
                and Related Stockholder Matters
            17Item
                12.
            Certain
                Relationships and Related Transactions, and Director
                Independence
            18Item
                13.
            Exhibits
            19Item
                14.
            Principal
                Accountant Fees and Services
            19


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          of Contents


PART
      I


Item1.   Description of Business





Overview





We
      were
      formed on June 27, 2006 to engage in the business of designing, marketing and
      distributing handcrafted baby blankets and other accessories made from quality
      fabrics. Our business operations have been conducted through our wholly owned
      subsidiary, Baby Dot LLC, a limited liability company incorporated under the
      laws of the State of Nevada. On August 15, 2006, we acquired Baby Dot, LLC
      from
      Ms. Jennie Slade, our officer and director, in exchange for 2,000,000 shares
      of
      our common stock. In that acquisition, we acquired all assets of the limited
      liability company, including our website, an existing but limited inventory
      of
      products, and all rights to the BabyDot designs.





Through
      our subsidiary, we introduced our blanket products in November of 2005, starting
      with our large 40” by 40” blanket, and later with our smaller 30” by 30”
blanket. Our business strategy was to sell quality blankets to the premium
      market in order to generate higher gross margins and offer significant growth
      potential. We have sought to indentify a brand image based on superior fabric
      designs, quality and style. We have carefully selected stylish modern prints
      and
      fabrics that we manufactured into a comfortable line of baby blankets. To make
      our products stand out from others, we have labeled our blankets with a BabyDot
      logo and design and hand-wrapped them with a satin ribbon prior to
      delivery.





Because
      we have not had enough product demand to necessitate large scale manufacturing,
      our strategy has been to hire talented woman to handcraft each blanket, the
      majority of which are stay-at-home moms. Every product has been made with great
      care and attention to detail. Our top priority was a happy
      consumer.





Since
      our
      inception, we have sought to diversify our product line. We have added several
      products, including children’s clothing, bibs, burp cloths, hats, and other baby
      accessories. We have also expanded our business to include baby announcements
      of
      births, blessings, birthdays, and other important events. Yet despite our
      efforts to grow, we have only achieved limited sales to date. Our limited sales
      since November 2005 have largely been the result of the personal efforts of
      our
      President, CEO and Director, Ms. Jennie Slade. We developed a website and blog
      to promote our products, but the bulk of our sales were the result of word
      of
      mouth marketing and small vendor shows.





Because
      demand for our products has been very limited, we have put a hold on our search
      to develop large-scale manufacturing from third party sources. In order to
      reserve needed capital to survive, we have also halted specific plans to
      implement our business plan, including expanding the creativity and
      functionality of our website, attending the ABC Kids Expo, and other
      plans.





As
      of the
      date of this annual, we are unsure whether our business will continue as a
      going
      concern. We have very limited revenues, and the bulk of our cash is from
      investor funds, which is slowly being depleting with operating expenses
      associated with running our business and fulfilling our reporting obligations
      as
      a public company.




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With
        these obstacles, our board of directors has rethought moving forward with
        the
        company’s current line of business and is considering other
        options.  Our management is now actively looking for other business
        opportunities for us to pursue. We have entered into negotiations to acquire
        the
        business operations of Capital City Petroleum, Inc., a Delaware corporation
        (“CCP”). Moving forward in this direction, on January 21, 2007, we changed our
        name to Capital City Energy Group, Inc., a Nevada corporation. On January
        24,
        2008, we also filed a Certificate of Designation with the Nevada Secretary
        of
        State relating to the establishment of Series A Preferred Stock. The Certificate
        of Designation sets forth the voting powers, designations, preferences,
        limitations and relative rights of the Series A Preferred Stock. A copy of
        the
        Certificate of Designation is attached to this Annual Report as Exhibit 3.1
        and
        is incorporated herein by reference.
 
 Notwithstanding
        the name change, the establishment of a series of preferred stock and extensive
        negotiations with CCP, we still have not finalized an acquisition transaction
        with that company. We anticipate that should such an opportunity arise, our
        business direction will change. There can be no assurance that our efforts
        to
        acquire such an opportunity will be successful.





Item2.   Description of Property





We
      own no real property.We maintain our corporate
      office at11741 Costa Blanca
      Ave.  Las Vegas, NV. Our President, CEO
      and Director, Ms.
      Jennie Slade, provides this space to our company free of
      charge.





Item3.   Legal Proceedings





We
      are
      not a party to any pending legal proceeding. We are not aware of any pending
      legal proceeding to which any of our officers, directors, or any beneficial
      holders of 5% or more of our voting securities are adverse to us or have a
      material interest adverse to us.





Item4.   Submission of Matters to a Vote of Security
      Holders





No
      matters have been submitted to our security holders for a vote, through the
      solicitation of proxies or otherwise, during the fourth quarter of the fiscal
      year ended October 31, 2007.


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          of Contents


PART
      II





Item5.    Market for Common Equity and Related Stockholder
      Mattersand Small Business Issuer Purchases of Equity
      Securities





Market
      Information





Our
      common stock is currently quoted on
      the OTC Bulletin Board(“OTCBB”),
      which is sponsored by the
      NASD.  The OTCBBis
      a network of security dealers who buy
      and sell stock.  The dealers are connected by a computer network that
      provides information on current "bids" and "asks", as well as volume
      information.  Our shares are quoted on the OTCBBunder
      the symbol “BBYD.OB.”





The
      following table sets forth the range of high and low bid quotations for our
      common stock for each of the periods indicated as reported by the
      OTCBB.  These quotations reflect inter-dealer prices, without retail
      mark-up, mark-down or commission and may not necessarily represent actual
      transactions.





Fiscal
                Year Ending October 31, 2007Quarter
                Ended
            
            High
                $
            
            Low
                $October
                31, 2007
            
            n/a
            
            n/aJuly
                31, 2007
            
            $0
            
            $0





Penny
      Stock





The
      SEC
      has adopted rules that regulate broker-dealer practices in connection with
      transactions in penny stocks. Penny stocks are generally equity securities
      with
      a market price of less than $5.00, other than securities registered on certain
      national securities exchanges or quoted on the NASDAQ system, provided that
      current price and volume information with respect to transactions in such
      securities is provided by the exchange or system. The penny stock rules require
      a broker-dealer, prior to a transaction in a penny stock, to deliver a
      standardized risk disclosure document prepared by the SEC, that: (a) contains
      a
      description of the nature and level of risk in the market for penny stocks
      in
      both public offerings and secondary trading; (b) contains a description of
      the
      broker's or dealer's duties to the customer and of the rights and remedies
      available to the customer with respect to a violation of such duties or other
      requirements of the securities laws; (c) contains a brief, clear, narrative
      description of a dealer market, including bid and ask prices for penny stocks
      and the significance of the spread between the bid and ask price; (d) contains
      a
      toll-free telephone number for inquiries on disciplinary actions; (e) defines
      significant terms in the disclosure document or in the conduct of trading in
      penny stocks; and (f) contains such other information and is in such form,
      including language, type size and format, as the SEC shall require by rule
      or
      regulation.





The
      broker-dealer also must provide, prior to effecting any transaction in a penny
      stock, the customer with (a) bid and offer quotations for the penny stock;
      (b)
      the compensation of the broker-dealer and its salesperson in the transaction;
      (c) the number of shares to which such bid


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and
      ask
      prices apply, or other comparable information relating to the depth and
      liquidity of the market for such stock; and (d) a monthly account statement
      showing the market value of each penny stock held in the customer's
      account.





In
      addition, the penny stock rules require that prior to a transaction in a penny
      stock not otherwise exempt from those rules, the broker-dealer must make a
      special written determination that the penny stock is a suitable investment
      for
      the purchaser and receive the purchaser's written acknowledgment of the receipt
      of a risk disclosure statement, a written agreement as to transactions involving
      penny stocks, and a signed and dated copy of a written suitability
      statement.





These
      disclosure requirements may have the effect of reducing the trading activity
      for
      our common stock. Therefore, stockholders may have difficulty selling our
      securities.





Holders
      of Our Common Stock





As
      of
      October 31, 2007, we had approximately thirty (30) holders of record of our
      common stock.





Dividends





There
      are
      no restrictions in our articles of incorporation or bylaws that restrict us
      from
      declaring dividends. The Nevada Revised Statutes, however, do prohibit us from
      declaring dividends where, after giving effect to the distribution of the
      dividend:





1.
            We
                would not be able to pay our debts as they become due in the usual
                course
                of business; or





2.
            Our
                total assets would be less than the sum of our total liabilities,
                plus the
                amount that would be needed to satisfy the rights of shareholders
                who have
                preferential rights superior to those receiving the distribution.





Recent
      Sales of Unregistered Securities





None.





Securities
      Authorized for Issuance Under Equity Compensation Plans





We
      have
      no equity compensation plans.


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Item6.Management’s
        Discussion and Analysisor Plan of
        Operation





Forward-Looking
      Statements


Certain
      statements, other than purely historical information, including estimates,
      projections, statements relating to our business plans, objectives, and expected
      operating results, and the assumptions upon which those statements are based,
      are “forward-looking statements” within the meaning of the Private Securities
      Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933
      and Section 21E of the Securities Exchange Act of
      1934.   These forward-looking statements generally are identified
      by the words “believes,” “project,” “expects,” “anticipates,” “estimates,”
“intends,” “strategy,” “plan,” “may,” “will,” “would,” “will be,” “will
      continue,” “will likely result,” and similar expressions.  We intendsuch
      forward-looking statements to
      be covered by the
      safe-harbor provisions for forward-looking statements contained in the Private
      Securities Litigation Reform Act of 1995, andareincluding
      this statement for purposes of
      complying with those safe-harbor provisions.Forward-looking
      statements are based on current expectations and assumptions that are subject
      to
      risks and uncertainties which may cause actual results to differ materially
      from
      the forward-looking statements. Ourability to predict results or the
      actual effect of future
      plans or strategies is inherently uncertain.Factors
      which could have a material
      adverse affect onouroperations and future prospects on a
      consolidated basis include, but are not limited to: changes in economic
      conditions, legislative/regulatory changes, availability
      of capital,
      interest rates, competition,and
      generally accepted accounting
      principles. These risks and uncertainties shouldalsobe
      considered in evaluating
      forward-looking statements and undue reliance should not be placed onsuch
      statements.We
      undertake no obligation to update or revise publicly any forward-looking
      statements, whether as a result of new information, future events or
      otherwise.  Further
      information concerningourbusiness, including additional factors
      that could materially
      affectourfinancial results, is included herein
      and inourother filings withthe SEC.





Plan
      of Operation in the Next 12 Months





We
      currently have limited business activities. While we still plan to offer our
      products to purchasing consumers, our long term plan is to identify and evaluate
      other business opportunities and make arrangements to acquire one that is
      consistent with our expertise and income needs. At the present time, we have
      not
      identified any other business opportunities that management believes is
      consistent with our expertise and income needs.





We
      can
      provide no assurance that we will be successful in finding other business
      opportunities due to our limited working capital. We anticipate that if we
      are
      successfully able to identify a business opportunity, we will require additional
      financing in order to enable us to complete the acquisition. However, we can
      provide no assurance that if we pursue additional financing we will receive
      any
      financing.





We
      currently have forecasted the expenditure of approximately $20,000 during the
      next six to twelve months in order to remain in compliance with the reporting
      requirements of the Securities Exchange Act of 1934 and to identify additional
      businesses for acquisition. The completion of our business plan for the next
      12
      months is contingent upon us obtaining additional financing. If




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we
      are
      unable to obtain additional financing, our business plan will be significantly
      impaired. We do not have any formal commitments or arrangements for the sales
      of
      stock or the advancement or loan of funds. Without the necessary cash flow,
      we
      will not be able to pursue our plan of operations until such time as the
      necessary funds are raised in the equity securities market. If we are successful
      and identify a business to acquire, we will need additional financing to
      complete this acquisition.





We
      do not
      anticipate purchasing any real property or significant equipment during the
      next
      12 months.





At
      the
      present time we have no employees other than our sole officer and director,
      Ms.
      Jennie Slade. We do not anticipate hiring any employees until such time as
      we
      are able to acquire any additional businesses.





Results
      of Operations for the Years Ended October 31, 2007 and 2006





We
      generated $1,893 in revenue for the year ended October 31, 2007, compared with
      $
      1,880 for the same period ended October 31, 2006. Our revenue during both
      periods was generated by sales of our BabyDot blankets and baby-accessory
      products.





Our
      cost
      of goods sold was $1,863 for the year ended October 31, 2007, as opposed to
      $1,016 for the same period ended 2006. Our gross profits were negligible for
      both periods and suggest that our business plan may not be viable in the long
      term.





We
      incurred operating expenses in the amount of $17,412 for the year ended October
      31, 2007, compared to $6,489 for the same period ended 2006. These operating
      expenses are primarily attributable to general and administrative expenses
      associated with the development of our business, legal expenses, and consulting
      fees.





The
      drastic increase in operating expenses for the year ended October 31, 2007,
      compared with the same period in 2006 is a result of management’s use of
      proceeds, acquired in our private equity offering in late 2006, to grow and
      develop our business. Increased funds were also used to pay for the increased
      expenses associated with being a reporting company under the Securities Exchange
      Act of 1934.





We
      incurred a loss in the amount of $17,382 for the year ended October 31, 2007,
      compared to $5,625 for the same period ended 2006.





Liquidity
      and Capital Resources





As
      of
      October 31, 2007, we had total current assets of $7,131. Our total current
      liabilities as of October 31, 2007 were $8,999. Thus, we had a working capital
      deficit of $1,868 as of October 31, 2007. As demonstrated above, we expect
      to
      spend upwards of $20,000 during the next six to twelve months in order to remain
      in compliance with the reporting requirements of the Securities Exchange Act
      of
      1934 and to identify additional businesses for acquisition.


We
      currently do not have enough cash to satisfy our minimum cash requirements
      for
      the next twelve months. This raises substantial doubt about our ability to
      continue as a going concern. Our ability to continue as a going concern is
      dependent on our ability to raise additional capital based upon the company’s
      desired plan of operation. Our financial statements do not include any
      adjustments that might be necessary if we are unable to continue as a going
      concern.





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          of Contents




As
      discussed above, the completion of our business plan for the next 12 months
      is
      contingent upon us obtaining additional financing. We do not anticipate meeting
      the financing requirements of our current business plan. Thus, we are currently
      negotiating to acquire other business opportunities, unrelated to our current
      business operations. We anticipate that we will also need additional financing
      to acquire another business. If we are unable to obtain additional financing,
      our business plan and our ability to acquire another business and continue
      as a
      going concern will be significantly impaired. We do not have any formal
      commitments or arrangements for the sales of stock or the advancement or loan
      of
      funds. Without the necessary cash flow, we will not be able to pursue our plan
      of operations or any plan of operations until such time as the necessary funds
      are raised in the equity securities market.





Off
      Balance Sheet Arrangements





As
      of
      October 31, 2007, there were no off balance sheet arrangements.





Going
      Concern





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





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





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


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          of Contents


Item7.   Financial Statements





Index
      to
      Financial Statements:





Audited
                Financial Statements:F-1
            Report
                of Independent Registered Public Accounting
                FirmF-2
            Consolidated
                Balance Sheets as of October 31, 2007 and
                2006F-3
            Consolidated
                Statements of Operations – Year Ended October 31,
                2007 and 2006 and period from November 1, 2005 (Inception) to October
                31,
                2007F-4
            Consolidated
                Statement of Stockholders’ Equity (Deficit) and
                Comprehensive Loss for period from November 1, 2005 (Inception) to
                October
                31, 2007F-5
            Consolidated
                Statements of Cash Flows - Year Ended October 31,
                2007 and 2006 and period from November 1, 2005 (Inception) to October
                31,
                2007F-6
            Notes
                to Consolidated Financial
                Statements





10
 Table
            of Contents


MOORE&
ASSOCIATES,
        CHARTERED
 ACCOUNTANTS
        AND
        ADVISORS
 PCAOB
        REGISTERED
 
 REPORT
        OF
        INDEPENDENT REGISTERED PUBLIC ACCOUNTINGFIRM
 
 The
        Board of
        Directors
 Capital
        City Energy Group,
        Inc.
 (fka
        The Baby Dot
        Company)
 Las
        Vegas,Nevada
 
 We
        have audited the accompanying balance
        sheet ofCapital City
        Energy Group, Inc. (fka The Baby Dot Company)as ofOctober
        31, 2007
        and 2006and the relatedstatements
        of operations, stockholders'equity (deficit)and
        cashflows
        forthe years ended October
        31, 2007
        and 2006 and from inception on
        November 1, 2005 through October 31, 2007. These financial statements
        are the
        responsibility of the Company's management. Ourresponsibility
        is to express an opinion
        on these financialstatements
        based on our
        audit.
 
 We
        conducted our audit in accordance
        with the standards of the Public CompanyAccounting
        Oversight Board in theUnited States of
        America. Those
        standardsrequire
        that we plan and perform the
        audit to obtain reasonable assurance aboutwhether
        the financial statements are
        free of material misstatement.An
        audit includes examining, on a test
        basis, evidence supporting the amountsand
        disclosures in the financial
        statements. An audit also includesassessing
        the accounting principles used
        and significant estimates made bymanagement,
        as well as evaluating the
        overall financial statement presentation.We
        believe that our audit provides a
        reasonable basis for our opinion.
 
 In
        our opinion, the financial statements
        referred to above presentfairly,
        in all material respects, the
        financial position ofCapital City Energy
        Group, Inc. (fka The
        Baby Dot Company)as ofOctober
        31, 2007and
        2006and the results of
        its
        operationsand
        its cash flowsfor the years ended
        October 31,
        2007and
        2006 and from inception on November
        1, 2005 through October 31, 2007in conformitywith
        accounting principles generally
        accepted in the United States of America.
 
 The
        accompanying financial statements
        have been prepared assuming the Company will continue as a going concern.
        However, in order for the Company to continue as a going concern,the
        Company will need, among other things, additional capital resourcesand developing a consistent
        source of revenues. Management's
        plans regarding those matters are described in Note 3. The financial statements
        do not include any adjustments that might result from the outcome of this
        uncertainty.
 
 /s/
        Moore & Associates,
        Chartered
 Las
        Vegas,Nevada
 January
        28, 2008
 
 2675
        S. Jones Blvd. Suite
        109, Las Vegas, NV 89146 (702) 253-7511 Fax (702) 253-7501
  Table
            of Contents
 CAPITALCITY
            ENERGY
            GROUP, INC.
 (FKA
            THE BABY DOT
            COMPANY)
 (A
            Development Stage
            Company)
 Balance
            Sheets
 ASSETSOctober
                          31,
                        2007
                    
                    
                    October
                          31,
                        2006CURRENT
                        ASSETSCash
                    $
                    7,131
                    
                    
                    $
                    5,014Prepaid
                        expenses
                    
                    -
                    
                    
                    
                    5Inventory
                    
                    -
                    
                    
                    
                    1,147Total
                        Current
                        Assets
                    
                    7,131
                    
                    
                    
                    6,166PROPERTY
                        AND EQUIPMENT,
                        net
                    
                    661
                    
                    
                    
                    -TOTAL
                        ASSETS
                    $
                    7,792
                    
                    
                    $
                    6,166LIABILITIES
                        AND STOCKHOLDERS' EQUITY (DEFICIT)CURRENT
                        LIABILITIESAccounts
                        payable
                    $
                    1,250
                    
                    
                    $
                    2,303Advances
                        from related
                        parties
                    
                    7,749
                    
                    
                    
                    2,488Total
                        Current
                        Liabilities
                    
                    8,999
                    
                    
                    
                    4,791STOCKHOLDERS'
                        EQUITY
                        (DEFICIT)Common
                        stock: $0.001 par value;
                      90,000,000
                        shares authorized, 9,960,000 and7,000,000
                        shares issued and outstanding, respectively
                    
                    9,960
                    
                    
                    
                    7,000Additional
                        paid-in
                        capital
                    
                    11,840
                    
                    
                    
                    -Deficit
                        accumulated during the
                        development stage
                    
                    (23,007)
                    
                    
                    
                    (5,625)Total
                        Stockholders' Equity (Deficit)
                    
                    (1,207)
                    
                    
                    
                    1,375TOTAL
                        LIABILITIES AND
                        STOCKHOLDERS' EQUITY (DEFICIT)
                    $
                    7,792
                    
                    
                    $
                    6,166
  The
                accompanying
                notes are an integral part of these financial
                statements.
 Table
                of Contents
 CAPITALCITY
                  ENERGY
                  GROUP, INC.
 (FKA
                  THE BABY DOT
                  COMPANY)
 (A
                  Development Stage
                  Company)
 Statements
                  of
                  Operations
  For
                            the Year
                            Ended
                          October
                            31,
                      
                      From
                                Inception
                              on
                                November 1,
                              2005
                                Through
                              October
                                31,2007
                      
                      2006
                      
                      2007REVENUES
                      $
                      1,893
                      
                      $
                      1,880
                      
                      $
                      3,773COST
                          OF
                          SALES
                      
                      1,863
                      
                      
                      1,016
                      
                      
                      2,879GROSS
                          MARGIN
                      
                      30
                      
                      
                      864
                      
                      
                      894OPERATING
                          EXPENSESGeneral
                          and
                          administrative
                      
                      17,412
                      
                      
                      6,489
                      
                      
                      23,901Total
                          Operating
                          Expenses
                      
                      17,412
                      
                      
                      6,489
                      
                      
                      23,901NET
                          LOSS
                      $
                      (17,382)
                      
                      $
                      (5,625)
                      
                      $
                      (23,007)BASIC
                          LOSS PER
                          SHARE
                      $
                      (0.00)
                      
                      $
                      (0.00)WEIGHTED
                          AVERAGESHARES OUTSTANDING
                      
                      8,986,849
                      
                      
                      2,797,260
 The
                  accompanying
                  notes are an integral part of these financial
                  statements.
 Table
                    of Contents
 CAPITALCITY
                      ENERGY
                      GROUP, INC.
 (FKA
                      THE BABY DOT
                      COMPANY)
 (A
                      Development Stage
                      Company)
 Statements
                      of Stockholders' Equity
                      (Deficit)
  Common
                                  Stock
                              
                              Additional
                                  Paid-In
                              
                              Deficit
                                      Accumulated
                                      During
                                        the
                                        Development
                              
                              Total
                                  Stockholders'Shares
                              
                              
                              Amount
                              
                              Capital
                              
                              Stage
                              
                              EquityBalance,
                                  November 1,
                                  2005
                              
                              -
                              
                              
                              $
                              -
                              
                              $
                              -
                              
                              $
                              -
                              
                              $
                              -Shares
                                  issued for
                                  cashat $0.001 per share
                              
                              5,000,000
                              
                              
                              
                              5,000
                              
                              
                              -
                              
                              
                              -
                              
                              
                              5,000Shares
                                    issued for services at
                                    $0.001 per share
                              
                              2,000,000
                              
                              
                              
                              2,000
                              
                              
                              -
                              
                              
                              -
                              
                              
                              2,000Net
                                  loss since
                                  inceptionthrough October 31, 2006
                              
                              -
                              
                              
                              
                              -
                              
                              
                              -
                              
                              
                              (5,625)
                              
                              
                              (5,625)Balance,
                                  October 31,
                                  2006
                              
                              7,000,000
                              
                              
                              
                              7,000
                              
                              
                              -
                              
                              
                              (5,625)
                              
                              
                              1,375Shares
                                  issued for
                                  cashat $0.005 per share
                              
                              2,960,000
                              
                              
                              
                              2,960
                              
                              
                              11,840
                              
                              
                              -
                              
                              
                              14,800Net
                                  loss for the
                                  yearended October 31, 2007
                              
                              -
                              
                              
                              
                              -
                              
                              
                              -
                              
                              
                              (17,382)
                              
                              
                              (17,382)Balance,
                                  October 31,
                                  2007
                              
                              9,960,000
                              
                              
                              $
                              9,960
                              
                              $
                              11,840
                              
                              $
                              (23,007)
                              
                              $
                              (1,207)
 The
                      accompanying
                      notes are an integral part of these financial
                      statements.
 Table
                        of Contents
 CAPITALCITY
                          ENERGY
                          GROUP, INC.
 (FKA
                          THE BABY DOT
                          COMPANY)
 (A
                          Development Stage
                          Company)
 Statements
                          of Cash
                          Flows
  For
                                        the Year
                                        Ended
                                      October
                                        31,
                                  
                                  From
                                            Inception
                                          on
                                            November 1,
                                          2005
                                            Through
                                          October
                                            31,2007
                                  
                                  2006
                                  
                                  2007CASH
                                      FLOWS FROMOPERATING
                                      ACTIVITIESNet
                                      loss
                                  $
                                  (17,382)
                                  
                                  $
                                  (5,625)
                                  
                                  $
                                  (23,007)Adjustments
                                      to reconcile net loss
                                      tonet
                                      cash used by operating
                                      activities:Depreciation
                                      expense
                                  
                                  11
                                  
                                  
                                  -
                                  
                                  
                                  11Common
                                      stock issued for
                                      services
                                  
                                  -
                                  
                                  
                                  2,000
                                  
                                  
                                  2,000Changes
                                      in operatingassets
                                      and
                                      liabilities:(Increase)
                                      decrease in
                                      inventory
                                  
                                  1,147
                                  
                                  
                                  (1,147)
                                  
                                  
                                  -(Increase)
                                      decrease in prepaid
                                      expenses
                                  
                                  5
                                  
                                  
                                  (5)
                                  
                                  
                                  -Increase
                                      (decrease) in accounts
                                      payable
                                  
                                  (1,053)
                                  
                                  
                                  2,303
                                  
                                  
                                  1,250Net
                                      Cash Used by Operating Activities
                                  
                                  (17,272)
                                  
                                  
                                  (2,474)
                                  
                                  
                                  (19,746)CASH
                                      FLOWS FROM INVESTING
                                      ACTIVITIESProperty
                                      and equipment
                                      purchased
                                  
                                  (672)
                                  
                                  
                                  -
                                  
                                  
                                  (672)Net
                                      Cash Used byOperating
                                      Activities
                                  
                                  (672)
                                  
                                  
                                  -
                                  
                                  
                                  (672)CASH
                                      FLOWS FROM FINANCING
                                      ACTIVITIESProceeds
                                      from common stock
                                      issued
                                  
                                  14,800
                                  
                                  
                                  5,000
                                  
                                  
                                  19,800Increase
                                      in advances from related
                                      parties
                                  
                                  5,261
                                  
                                  
                                  2,488
                                  
                                  
                                  7,749Net
                                      Cash Provided by Financing Activities
                                  
                                  20,061
                                  
                                  
                                  7,488
                                  
                                  
                                  27,549NET
                                      DECREASE IN
                                      CASH
                                  
                                  2,117
                                  
                                  
                                  5,014
                                  
                                  
                                  7,131CASH
                                      AT BEGINNING OF
                                      PERIOD
                                  
                                  5,014
                                  
                                  
                                  -
                                  
                                  
                                  -CASH
                                      AT END OF
                                      PERIOD
                                  $
                                  7,131
                                  
                                  $
                                  5,014
                                  
                                  $
                                  7,131SUPPLIMENTAL
                                      DISCLOSURES OF
                                      CASH FLOW INFORMATIONCASH
                                      PAID
                                      FOR:Interest
                                  $
                                  -
                                  
                                  $
                                  -
                                  
                                  $
                                  -Income
                                      Taxes
                                  $
                                  -
                                  
                                  $
                                  -
                                  
                                  $
                                  -
 The
                          accompanying
                          notes are an integral part of these financial
                          statements.
 Table
                            of
                            Contents
 CAPITALCITY
            ENERGY GROUP, INC.
 (FKA
            THE BABY DOT COMPANY)
 (A
            Development Stage Company)
 Notes
            to
            Financial Statements
 October
            31, 2007 and 2006


1.           
        SUMMARY OF SIGNIFICANT
        ACCOUNTING POLICIES
 Nature
        of
        Business
 The
        Capital City Energy Group, Inc. (fka BabyDot Company) was incorporated in
        the
        State of Nevada on June 27, 2006. The Company’s fiscal year end is October
        31.  The Company is engaged in the business of designing, marketing
        and distributing handcrafted baby blankets and other accessories made from
        quality fabrics.  On August 15, 2006, the Company acquired its
        operating entity, Baby Dot, LLC, a Nevada limited liability company, from
        Ms.
        Jennie Slade in consideration for 2,000,000 shares of the Company’s common
        stock. In that acquisition, the Company acquired all assets of the limited
        liability company, including a website, an existing but limited inventory
        of
        products, and all rights to the BabyDot designs.
 
 Use
        of
        Estimates
 The
        preparation of financial statements in conformity with accounting principles
        generally accepted in the United States of America requires management to
        make
        estimates and assumptions that affect the reported amounts of assets and
        liabilities at the date of the financial statements and the reported amounts
        of
        revenue and expenses during the reporting period. Actual results could differ
        from those estimates.
 
 Basic
        (Loss) per Common
        Share
 Basic
        (loss) per share is calculated by dividing the Company’s net loss applicable to
        common shareholders by the weighted average number of common shares during
        the
        period. Diluted earnings per share is calculated by dividing the Company’s net
        income available to common shareholders by the diluted weighted average number
        of shares outstanding during the year. The diluted weighted average number
        of
        shares outstanding is the basic weighted number of shares adjusted for any
        potentially dilutive debt or equity. There are no such common stock equivalents
        outstanding as of October 31, 2007 and 2006.
 
 For
                  the
                Year
                  Ended
                October
                  31,
                2007
              
              For
                  the
                Year
                  Ended
                October
                  31,
                2006Loss
                  (numerator)
              $
              (17,382)
              
              $
              (5,625)Shares
                  (denominator)
              
              8,986,849.
              
              
              2,797,260Per
                  share amount
              $
              (0.00)
              
              $
              (0.00)
 
 Revenue
        Recognition
 The
        Company recognizes revenue when products are fully delivered or services
        have
        been provided and collection is reasonably assured.
  Table
            of Contents
 CAPITAL
        CITY ENERGY GROUP, INC.
 (FKA
        THE BABY DOT COMPANY)
 (A
        Development Stage Company)
 Notes
        to
        Financial Statements
 October
        31, 2007 and 2006
 
 1.           
        SUMMARY OF SIGNIFICANT
        ACCOUNTING POLICIES (Continued)
  Advertising
        Costs
 The
        Company’s policy regarding advertising is to expense advertising when incurred.
        The Company had not incurred any advertising expense as of October 31,
        2007.
 
 Cash
        and Cash
        Equivalents
 For
        purposes of the Statement of Cash Flows, the Company considers all highly
        liquid
        instruments purchased with a maturity of three months or less to be cash
        equivalents to the extent the funds are not being held for investment
        purposes.
 
 Income
        Taxes
 The
        Company provides for income taxes under Statement of Financial Accounting
        Standards No. 109, Accounting for Income Taxes. SFAS No. 109
 Requires
        the use of an asset and liability approach in accounting for income taxes.
        Deferred tax assets and liabilities are recorded based on the differences
        between the financial statement and tax bases of assets and liabilities and
        the
        tax rates in effect when these differences are expected to reverse. The
        Company’s predecessor operated as entity exempt from Federal and State income
        taxes.
 
 SFAS
        No.
        109 requires the reduction of deferred tax assets by a valuation allowance
        if,
        based on the weight of available evidence, it is more likely than not that
        some
        or all of the deferred tax assets will not be realized.
 
 The
        provision for income taxes differs from the amounts which would be provided
        by
        applying the statutory federal income tax rate of 34% to the net loss before
        provision for income taxes for the following reasons:
  For
                  the Year Ended
                October
                  31,
                2007
              
              For
                  the Year Ended
                October
                  31,
                2006Income
                  tax expense at statutory rate
              $
              5,910.
              
              $
              1,913)Common
                  stock issued for services
              
              -
              
              
              (680)Valuation
                  allowance
              
              (5,910)
              
              
              (1,233)Income
                  tax expense per books
              $
              -.
              
              $
              -.
  Table
            of Contents
 CAPITAL
          CITY ENERGY GROUP, INC.
 (FKA
          THE BABY DOT COMPANY)
 (A
          Development Stage Company)
 Notes
          to
          Financial Statements
 October
          31, 2007 and 2006
 
 1.           
        SUMMARY OF SIGNIFICANT
        ACCOUNTING POLICIES (Continued)
  Income
        Taxes
        (Continued)
 
 Net
        deferred tax assets consist of the following components as of:
  October
                  31,
                2007
              
              October
                  31,
                2006Deferred
                  tax assets
              
              .
              
              
              )NOL
                  Carryover
              $
              7,143.
              
              $
              1,233Valuation
                  allowance
              
              (1,143)
              
              
              (1,233)Net
                  deferred tax assets
              $
              -.
              
              $
              -
 
 Due
        to
        the change in ownership provisions of the Tax Reform Act of 1986, net operating
        loss carry forwards of $21,007 for federal income tax reporting purposes
        are
        subject to annual limitations. Should a change in ownership occur net operating
        loss carry forwards may be limited as to use in future years.
 
 Impairment
        of Long-Lived
        Assets
 The
        Company continually monitors events and changes in circumstances that could
        indicate carrying amounts of long-lived assets may not be recoverable. When
        such
        events or changes in circumstances are present, the Company assesses the
        recoverability of long-lived assets by determining whether the carrying value
        of
        such assets will be recovered through undiscounted expected future cash flows.
        If the total of the future cash flows is less than the carrying amount of
        those
        assets, the Company recognizes an impairment loss based on the excess of
        the
        carrying amount over the fair value of the assets. Assets to be disposed
        of are
        reported at the lower of the carrying amount or the fair value less costs
        to
        sell.
 
 Accounting
        Basis
 The
        basis
        is accounting principles generally accepted in the United States of
        America.  The Company has adopted an October 31 fiscal year
        end.
 
 Inventory
 The
        Company accounts for inventory of raw materials and finished goods on a cost
        basis.  The inventory is maintained on a first in- first out (FIFO)
        basis. The Company recorded an impairment of the full value of its inventory
        as
        of October 31, 2007.
 
 Property
        and
        Equipment
 The
        Company currently has no property or equipment.  If the Company
        obtains property and equipment they will be depreciated over the estimated
        useful lives of the related assets.  Depreciation and amortization
        will be computed on the straight-line method.
  Table
            of Contents
 CAPITAL
          CITY ENERGY GROUP, INC.
 (FKA
          THE BABY DOT COMPANY)
 (A
          Development Stage Company)
 Notes
          to
          Financial Statements
 October
          31, 2007 and 2006
 1.           
        SUMMARY OF SIGNIFICANT
        ACCOUNTING POLICIES (Continued)
  Stock-based
        compensation.
 As
        of
        October 31, 2007, the Company has not issued any share-based payments to
        its
        employees.
 
 The
        Company adopted SFAS No. 123-R effective January 1, 2006 using the
        modified prospective method. Under this transition method, stock compensation
        expense includes compensation
        expense for all stock-based compensation awards granted on or after
        January 1,2006, based on the grant-date fair value estimated in accordance
        with the provisions of SFAS No. 123-R.
 
 Recent
        Accounting
        Pronouncements
 In
        September 2006, the Financial Accounting Standards Board issued Statement
        of
        Financial Accounting Standards No. 157, “Fair Value Measurements” which defines
        fair value, establishes a framework for measuring fair value in generally
        accepted accounting principles (GAAP), and expands disclosures about fair
        value
        measurements. Where applicable, SFAS No. 157 simplifies and codifies
        related guidance within GAAP and does not require any new fair value
        measurements. SFAS No. 157 is effective for financial statements issued for
        fiscal years beginning after November 15, 2007, and interim periods within
        those fiscal
 years. Earlier
        adoption is encouraged. The Company does not expect the adoption of SFAS
        No. 157 to have a significant effect on its financial position or results
        of operation.
 
 In
        June
        2006, the Financial Accounting Standards Board  issued FASB
        Interpretation No. 48, “Accounting for Uncertainty in Income Taxes – an
        interpretation of FASB Statement No. 109”, which prescribes a recognition
        threshold and measurement attribute for the financial statement recognition
        and
        measurement of a tax position taken or expected to be taken in a tax
        return.  FIN 48 also provides guidance on de-recognition,
        classification, interest and penalties, accounting in interim periods,
        disclosure and transition. FIN 48 is effective for fiscal years beginning
        after
        December 15, 2006.  The Company does not expect the adoption of FIN 48
        to have a material impact on its financial reporting, and the Company is
        currently evaluating the impact, if any, the adoption of FIN 48 will have
        on its
        disclosure requirements.
 
 In
        March
        2006, the Financial Accounting Standards Board issued Statement of Financial
        Accounting Standards No. 156, “Accounting for Servicing of Financial Assets—an
        amendment of FASB Statement No. 140.” This statement requires an entity to
        recognize a servicing asset or servicing liability each time it undertakes
        an
        obligation to service a financial asset by entering into a servicing contract
        in
        any of the following situations: a transfer of the servicer’s financial assets
        that
  Table
            of Contents
 CAPITAL
          CITY ENERGY GROUP, INC.
 (FKA
          THE BABY DOT COMPANY)
 (A
          Development Stage Company)
 Notes
          to
          Financial Statements
 October
          31, 2007 and 2006
 1.           
        SUMMARY OF SIGNIFICANT
        ACCOUNTING POLICIES (Continued)
  Recent
        Accounting
        Pronouncements (Continued)
 
 meets
        the
        requirements for sale accounting; a transfer of the servicer’s financial assets
        to a qualifying special-purpose entity in a guaranteed mortgage securitization
        in which the transferor retains all of the resulting securities and classifies
        them as either available-for-sale securities or trading securities; or an
        acquisition or assumption of an obligation to service a financial asset that
        does not relate to financial assets of the servicer or its consolidated
        affiliates. The statement also requires all separately recognized servicing
        assets and servicing liabilities to be initially measured at fair value,
        if
        practicable, and permits an entity to choose either the amortization or fair
        value method for subsequent measurement of each class of servicing assets
        and
        liabilities. The statement further permits, at its initial adoption, a one-time
        reclassification of available for sale securities to trading securities by
        entities with recognized servicing rights, without calling into question
        the
        treatment of other available for sale securities
 under
        Statement 115, provided that the available for sale securities are identified
        in
        some manner as offsetting the entity’s exposure to changes in fair value of
        servicing assets or servicing liabilities that a servicer elects to subsequently
        measure at fair value and requires separate presentation of servicing assets
        and
        servicing liabilities subsequently measured at fair value in the statement
        of
        financial position and additional disclosures for all separately recognized
        servicing assets and servicing liabilities. This statement is effective for
        fiscal years beginning after September 15, 2006, with early adoption permitted
        as of the beginning of an entity’s fiscal year. Management believes the adoption
        of this statement will have no immediate impact on the Company’s financial
        condition or results of operations.
 
 2.           
        COMMON
        STOCK
 On
        August
        4, 2006, the Company issued 5,000,000 shares of its common stock for $5,000
        from
        its founder, Ms. Jennie Slade.
 
 During
        the year ended October 31, 2007, the Company issued 2,960,000 shares of its
        common stock at $0.005 per share in a private placement.
 
 3.           
        RELATED PARTY
        TRANSACTIONS
 Ms.
        Jennie Slade, the Company’s officer and director, has advanced the Company
        $2,546 for operating capital.  There are no terms associated with the
        advance.
 
 On
        August
        15, 2006, the Company acquired its operating entity, Baby Dot, LLC, a Nevada
        limited liability company, from Ms. Jennie Slade in consideration for 2,000,000
        shares of the Company’s common stock. In that acquisition, the
  3.           
        RELATED PARTY
        TRANSACTIONS (Continued)
 Company
        acquired all assets of the limited liability company, including a website,
        an
        existing but limited inventory of products, and all rights to the
        BabyDot
 designs.  The
        consideration we paid for Baby Dot, LLC was arbitrarily determined by Ms.
        Jennie
        Slade and bears no relationship to the LLC’s assets, earnings, book value or any
        other objective criteria of value.
 
 The
        officers and directors of the Company are involved in other business activities
        and may, in the future, become involved in other business opportunities that
        become available.  They may face a conflict in selecting between the
        Company and other business interests. The Company has not formulated a policy
        for the resolution of such conflicts.
 
 4.           
        GOING
        CONCERN
 The
        accompanying financial statements have been prepared in conformity with
        generally accepted accounting principle, which contemplate continuation of
        the
        Company as a going concern.  However, the Company has accumulated
        deficit of $23,007 as of October 31, 2007.  The Company currently has
        limited liquidity, and has not completed its efforts to establish a stabilized
        source of revenues sufficient to cover operating costs over an extended period
        of time.
 
 Management
        anticipates that the Company will be dependent, for the near future, on
        additional investment capital to fund operating expenses The Company intends
        to
        position itself so that it may be able to raise additional funds through
        the
        capital markets. In light of management’s efforts, there are no assurances that
        the Company will be successful in this or any of its endeavors or become
        financially viable and continue as a going concern.


Table
          of Contents


Item8.   Changes
      In and Disagreements with
      Accountants on Accounting and Financial Disclosure





No
      events
      occurred requiring disclosure under Item 304(b) of Regulation S-B.





Item8A.  Controls and Procedures





We
      carried out an evaluation of the effectiveness of the design and operation
      of
      our disclosure controls and procedures (as defined in Exchange Act Rules
      13a-15(e) and 15d-15(e)) as of October 31, 2007.  This evaluation was
      carried out under the supervision and with the participation of our Chief
      Executive Officer and Chief Financial Officer, Mrs. Jennie Slade. Based upon
      that evaluation, our Chief Executive Officer and Chief Financial Officer
      concluded that, as of October 31, 2007, our disclosure controls and procedures
      are effective.  There have been no significant changes in our internal
      controls over financial reporting during the year ended October 31, 2007 that
      have materially affected or are reasonably likely to materially affect such
      controls.





Disclosure
      controls and procedures are controls and other procedures that are designed
      to
      ensure that information required to be disclosed in our reports filed or
      submitted under the Exchange Act are recorded, processed, summarized and
      reported, within the time periods specified in the SEC's rules and forms.
      Disclosure controls and procedures include, without limitation, controls and
      procedures designed to ensure that information required to be disclosed in
      our
      reports filed under the Exchange Act is accumulated and communicated to
      management, including our Chief Executive Officer and Chief Financial Officer,
      to allow timely decisions regarding required disclosure.





Limitations
      on the
      Effectiveness of Internal Controls





Our
      management does not expect that our disclosure controls and procedures or our
      internal control over financial reporting will necessarily prevent all fraud
      and
      material error. Our disclosure controls and procedures are designed to provide
      reasonable assurance of achieving our objectives and our Chief Executive Officer
      and Chief Financial Officer concluded that our disclosure controls and
      procedures are effective at that reasonable assurance level.  Further,
      the design of a control system must reflect the fact that there are resource
      constraints, and the benefits of controls must be considered relative to their
      costs. Because of the inherent limitations in all control systems, no evaluation
      of controls can provide absolute assurance that all control issues and instances
      of fraud, if any, within our company have been detected. These inherent
      limitations include the realities that judgments in decision-making can be
      faulty, and that breakdowns can occur because of simple error or mistake.
      Additionally, controls can be circumvented by the individual acts of some
      persons, by collusion of two or more people, or by management override of the
      internal control. The design of any system of controls also is based in part
      upon certain assumptions about the likelihood of future events, and there can
      be
      no assurance that any design will succeed in achieving its stated goals under
      all potential future conditions. Over time, control may become inadequate
      because of changes in conditions, or the degree of compliance with the policies
      or procedures may deteriorate.


11
 Table
          of Contents


Item8B.  Other
      information





The
      information in Part I, Item 1. is
      incorporated herein by reference.





PART
      III





Item9.  Directors, Executive Officers, Promoters and Control Persons;
      Compliance with Section
      16(a) of the Exchange
      Act





The
      following information sets forth the names of our current directors and
      executive officers, their ages and their present positions.





Name
            Age
            Position
                Held with the CompanyJennie
                Slade
              3071
                Wandering River Ct.
              Las
                Vegas, NV 89135
            29
            President,
                Secretary, Chief Executive Officer, Chief Financial Officer, Principal
                Executive Officer, Principal Accounting Officer, and
                DirectorJoey
                Jennings
              3101
                Susan Dr.
              Pahrump,
                NV 89060
            33
            Chief
                Strategic Officer





Set
      forth
      below is a brief description of the background and business experience of
      executive officers and directors.




Jennie
      Slade.Jennie Slade has been our President, Chief Executive
      Officer, Secretary and Director since our inception. Ms. Slade attended Brigham
      Young University for two years and graduated from the University of Nevada
      Las
      Vegas in 2000 with a Bachelor’s degree in Spanish.  Ms. Slade is the
      mother of three children.  In 2003, Ms. Slade worked in interior
      decorating and began selling upholstered furniture. From 2003 to 2005, Ms.
      Slade
      designed and furnished in the commercial and residential sector and established
      a profitable business.  In 2005, Ms. Slade started a business on Ebay
      selling children’s hair accessories called “Kate Taylor Hair
      Bowtique.”  Following her passion for creating and designing, Ms.
      Slade started a designer blanket business, called “Baby Dot LLC,” which is our
      wholly-owned subsidiary and operating business to date.





Joey
      Jennings.  Joey
      Jennings joined our business in September of 2006 as our Chief Strategic Officer
      to assist our marketing efforts and provide managerial support.  From
      2003 to the present, Mr. Jennings has been employed with Coldwell Banker
      Commercial Reno, to assist clients in the buying and selling of commercial
      property, primarily Multi-family projects.  From 2001 to 2003, Mr.
      Jennings was employed by Crest Budget Inn, LLC, as an In-House Leasing Manager
      of 300 unit weekly/monthly units.  Mr. Jennings also served the same
      company as a real estate agent to locate properties nationwide meeting certain
      investment criteria.  From 2000-2003, Mr. Jennings owned a company
      known as Blue Brainz, that wholesaled clothing to retail shops.





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Term
      of Office





Our
      Directors are appointed for a one-year term to hold office until the next annual
      general meeting of our shareholders or until removed from office in accordance
      with our bylaws.  Our officers are appointed by our board of directors
      and hold office until removed by the board.





Significant
      Employees





We
      do not
      currently have any significant employees aside from Ms. Slade and Mr.
      Jennings.





Family
      Relationships





There
      are
      no family relationships between or among the directors, executive officers
      or
      persons nominated or chosen by us to become directors or executive
      officers.





Involvement
      in Certain Legal Proceedings





To
      the
      best of our knowledge, during the past five years, none of the following
      occurred with respect to our present or former director, executive officer,
      or
      employee: (1) any bankruptcy petition filed by or against any business of which
      such person was a general partner or executive officer either at the time of
      the
      bankruptcy or within two years prior to that time; (2) any conviction in a
      criminal proceeding or being subject to a pending criminal proceeding (excluding
      traffic violations and other minor offenses); (3) being subject to any order,
      judgment or decree, not subsequently reversed, suspended or vacated, of any
      court of competent jurisdiction, permanently or temporarily enjoining, barring,
      suspending or otherwise limiting his or her involvement in any type of business,
      securities or banking activities; and (4) being found by a court of competent
      jurisdiction (in a civil action), the SEC or the Commodities Futures Trading
      Commission to have violated a federal or state securities or commodities law,
      and the judgment has not been reversed, suspended or vacated.





Audit
      Committee





We
      do not
      have a separately-designated standing audit committee.  The entire
      board of directors performs the functions of an audit committee, but no written
      charter governs the actions of the board of directors when performing the
      functions of that would generally be performed by an audit committee. The board
      of directors approves the selection of our independent accountants and meets
      and
      interacts with the independent accountants to discuss issues related to
      financial reporting. In addition, the board of directors reviews the scope
      and
      results of the audit with the independent accountants, reviews with management
      and the independent accountants our annual operating results, considers the
      adequacy of our internal accounting procedures and considers other auditing
      and
      accounting matters including fees to be paid to the independent auditor and
      the
      performance of the independent auditor.




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We
      do not
      have an audit committee financial expert because of the size of our company
      and
      our board of directors at this time.  We believe that we do not
      require an audit committee financial expert at this time because we retain
      outside consultants who possess these attributes.





For
      the
      fiscal year ending October 31, 2007, the board of directors:





1.
            Reviewed
                and discussed the audited financial statements with management,
                and





2.
            Reviewed
                and discussed the written disclosures and the letter from our independent
                auditors on the matters relating to the auditor's
                independence.





Based
      upon the board of directors’ review and discussion of the matters above, the
      board of directors authorized inclusion of the audited financial statements
      for
      the year ended October 31, 2007 to be included in this Annual Report on Form
      10-KSB and filed with the Securities and Exchange Commission.





Section
      16(a) Beneficial Ownership Reporting Compliance





Our
      officers, directors and shareholders owning greater than ten percent of our
      shares are not required to comply with Section 16(a) of the Securities Exchange
      Act of 1934 because we do not have a class of securities registered under
      Section 12 of the Securities Exchange Act of 1934.





Code
      of Ethics
      Disclosure





As
      of
      October 31, 2007, we have not adopted a Code of Ethics for Financial Executives,
      which include our principal executive officer, principal financial officer,
      principal accounting officer or controller, or persons performing similar
      functions.


14
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  Item10.  Executive Compensation





Summary
      Compensation Table





The
      table
      below summarizes all compensation awarded to, earned by, or paid to both to
      our
      officers and to our directors for all services rendered in all capacities to
      us
      for our fiscal years ended October 31, 2007 and 2006.





We
      do not
      pay to our directors or officers any salary or consulting fee. We anticipate
      that compensation may be paid to officers in the event our formula becomes
      marketable.





SUMMARY
                COMPENSATION TABLENameand
              principalposition
            Year
            Salary($)
            Bonus
              ($)
            Stock
              Awards
              ($)
            Option
              Awards
              ($)
            Non-Equity
              Incentive
                Plan
              Compensation
              ($)
            Nonqualified
              Deferred
              Compensation
              Earnings
                ($)
            All
                Other
              Compensation
              ($)
            Total
              ($)Jennie
                Slade, President, CEO, Secretary and Director
            2007
              2006
            $0
              $0
            $0
              $0
            $0
              $0
            $0
              $0
            $0
              $0
            $0
              $0
            $0
              $0
            $0
              $0Joey
                Jennings,
              Chief
                Strategic Officer
            2007
              2006
            $0
              $0
            $0
              $0
            $0
              $0
            $0
              $0
            $0
              $0
            $0
              $0
            $0
              $0
            $0
              $0





Narrative
      Disclosure to the Summary Compensation Table





We
      do not
      compensate our executive officers by the payment of salaries or bonus
      compensation.





Stock
      Option Grants





We
      have
      not granted any stock options to the executive officers or directors since
      our
      inception.


15
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Outstanding
      Equity Awards at Fiscal Year-End





The
      table
      below summarizes all unexercised options, stock that has not vested, and equity
      incentive plan awards for each named executive officer as of October 31,
      2007.





OUTSTANDING
                EQUITY AWARDS AT FISCAL YEAR-ENDOPTION
                AWARDS
            STOCK
                AWARDSName
            Number
                of
              Securities
              Underlying
              Unexercised
              Options
              (#)
              Exercisable
            Number
                of
              Securities
              Underlying
              Unexercised
              Options
              (#)
              Unexercisable
            Equity
              Incentive
              Plan
              Awards:
              Number
                of
              Securities
              Underlying
              Unexercised
              Unearned
              Options
              (#)
            Option
              Exercise
              Price
              ($)
            Option
              Expiration
              Date
            Number
              of
              Shares
              or
                Units
              of
              Stock
                That
              Have
              Not
              Vested
              (#)
            Market
              Value
              of
              Shares
              or
              Units
              of
              Stock
              That
              Have
              Not
              Vested
              ($)
            Equity
              Incentive
              Plan
              Awards:
              Number
              of
              Unearned
              Shares,
              Units
                or
              Other
              Rights
              That
                Have
              Not
              Vested
              (#)
            Equity
              Incentive
              Plan
              Awards:
              Market
                or
              Payout
              Value
                of
              Unearned
              Shares,
              Units
                or
              Other
              Rights
              That
              Have
                Not
              Vested
              (#)Jennie
                Slade
            -
            -
            -
            -
            -
            -
            -
            -
            -Joey
                Jennings
            -
            -
            -
            -
            -
            -
            -
            -
            -





Compensation
      of Directors





The
      table
      below summarizes all compensation of our directors as of October 31,
      2007.





DIRECTOR
                COMPENSATIONName
            Fees
                Earned or
              Paid
                in
              Cash
              ($)
            Stock
                Awards
              ($)
            Option
                Awards
              ($)
            Non-Equity
              Incentive
              Plan
              Compensation
              ($)
            Non-Qualified
              Deferred
              Compensation
              Earnings
              ($)
            All
              Other
              Compensation
              ($)
            Total
              ($)Jennie
                Slade
            -
            -
            -
            -
            -
            -
            -





Narrative
      Disclosure to the Director Compensation Table





We
      do not
      pay any cash compensation to our directors.


16
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Item11.  Security Ownership of Certain Beneficial Owners and
      Management and Related Stockholder
      Matters





The
      following table sets forth, as of October 31, 2007, certain information as
      to
      shares of our common stock owned by (i) each person known by us to beneficially
      own more than 5% of our outstanding common stock, (ii) each of our directors,
      and (iii) all of our executive officers and directors as a group:





Name
                and Address of Beneficial Owners of Common Stock1
            Title
                of Class
            Amount
                and Nature of
              Beneficial
                Ownership
            %
                of Common Stock2Jennie
                Slade
              3071
                Wandering River Ct.
              Las
                Vegas, NV 89135
            Common
                Stock
            7,000,000
            70.3%Joey
                Jennings
              3101
                Susan Dr.
              Pahrump,
                NV 89060
            Common
                Stock
            NONE
            NONEDIRECTORS
                AND OFFICERS – TOTAL
            
            7,000,000
            70.3%5%
                SHAREHOLDERSNONE
            Common
                Stock
            NONE
            NONE




1.
            As
                used in this table, "beneficial ownership" means the sole or shared
                power
                to vote, or to direct the voting of, a security, or the sole or shared
                investment power with respect to a security (i.e., the power to dispose
                of, or to direct the disposition of, a security).  In addition,
                for purposes of this table, a person is deemed, as of any date, to
                have
                "beneficial ownership" of any security that such person has the right
                to
                acquire within 60 days after such
                date.




2.
            The
                percentage shown is based on denominator of 9,960,000 shares of common
                stock issued and outstanding for the company as of October 31,
                2007.


17
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  Item12.   Certain Relationships and Related
      Transactions





Except
      as
      provided below, none of the following parties has, since our date of
      incorporation, had any material interest, direct or indirect, in any transaction
      with us or in any presently proposed transaction that has or will materially
      affect us:





·
            Any
                of our directors or officers;


·
            Any
                person proposed as a nominee for election as a
                director;


·
            Any
                person who beneficially owns, directly or indirectly, shares carrying
                more
                than 10% of the voting rights attached to our outstanding shares
                of common
                stock;


·
            Any
                of our promoters;


·
            Any
                relative or spouse of any of the foregoing persons who has the same
                house
                address as such person.





On
      August
      15, 2006, we acquired our operating entity, Baby Dot, LLC, a Nevada limited
      liability company, from Ms. Jennie Slade in consideration for 2,000,000 shares
      of our common stock. In that acquisition, we acquired all assets of the company,
      including our website, an existing but limited inventory of products, and all
      rights to the BabyDot designs.  The consideration we paid for Baby
      Dot, LLC was arbitrarily determined by Ms. Jennie Slade and bears no
      relationship to the LLC’s assets, earnings, book value or any other objective
      criteria of value.


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Item13.   Exhibits





Exhibit
                Number
            Description3.1
            Articles
                of Incorporation (1)3.2
            By-laws
                (1)3.3
            Certificate
              of Designation for Series A Preferred
              Stock31.1
            Certification
                of Chief Executive Officer pursuant to
                Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant
                to
                Section 302 of the Sarbanes-Oxley Act of 200231.2
            Certification
                of Chief Financial Officer pursuant to
                Securities Exchange Act Rule 13a-14(a)/15d-14(a), as adopted pursuant
                to
                Section 302 of the Sarbanes-Oxley Act of 200232.1
            Certification
                of Chief Executive Officer and Chief
                Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
                pursuant
                to Section 906 of the Sarbanes-Oxley Act of
                2002





(1)
            Incorporated
                by reference to our Form SB-2 filed with the Securities and Exchange
                Commission on February 21, 2007.





Item14.Principal Accountant
      Fees and
      Services





Audit
      Fees





The
      aggregate fees billed by our auditors for professional services rendered in
      connection with a review of the financial statements included in our quarterly
      reports on Form 10-QSB and the audit of our annual consolidated financial
      statements for the fiscal years ended October 31, 2007 and 2006 were
      approximately $8,250
      and $2,500 respectively.





Audit-Related
      Fees





Our
      auditors did not bill any additional
      fees for assurance and related services that are reasonably related to the
      performance of the audit or review of our financial
      statements.





Tax
      Fees





The
      aggregate fees billed by our
      auditors for professional services for tax compliance, tax advice, and tax
      planning were $0 and $0 for the fiscal years endedOctober 31, 2007 and
      2006.





All
      Other Fees





The
      aggregate fees billed by our
      auditors for all other non-audit services, such as attending meetings and other
      miscellaneous financial consulting, for the fiscal years endedOctober
      31, 2007 and 2006 were $0 and $0
      respectively.


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            of Contents




SIGNATURES





In
      accordance withSection 13or15(d)
      of the Exchange Act, theregistrantcaused
      this report to be signedon its behalf by the
      undersigned, thereunto duly authorized.





The
      BabyDot Company





By:
            /s/
                Jennie SladeJennie
                Slade
              President,
                Secretary, Chief Executive Officer, Chief Financial Officer, Principal
                Executive Officer, Principal Accounting Officer, and
                DirectorJanuary
                28, 2008





In
      accordance with the Exchange Act,
      this report has been signed below by the following persons on behalf of the
      registrant and in the capacities and on the dates indicated:





By:
            /s/
                Jennie SladeJennie
                Slade
              President,
                Secretary, Chief Executive Officer, Chief Financial Officer, Principal
                Executive Officer, Principal Accounting Officer, and
                DirectorJanuary
                28, 2008