Financial Statements

REPORT OF INDEPENDENT CERTIFIED PUBLIC
ACCOUNTANTS
Board of Directors and Stockholders
Camelot Corporation and Subsidiaries

We  have  audited  the  accompanying
consolidated balance   sheets   of  Camelot
Corporation                                    and
Subsidiaries as of April 30, 1997 and the
related consolidated     statements     of
operations, stockholders' equity, and cash
flows for  each  of the  two years in the
period ended April 30, 1997. These
financial statements are the responsibility
of  the  Company's management.  Our
responsibility is  to  express  an  opinion
on  these  financial statements based on
our audits.

We   conducted  our  audits  in  accordance
with
generally  accepted  auditing  standards.
Those standards  require that we plan  and
perform  the audit to obtain reasonable
assurance about whether the  financial
statements are  free  of  material
misstatement.  An audit includes examining,
on  a test  basis,  evidence supporting the
amounts  and disclosures in the financial
statements.  An audit also  includes
assessing the accounting principles used
and significant estimates made by
management, as                                 well  as  evaluating
the  overall  financial
statement  presentation.  We  believe  our
audits provide a reasonable basis for our
opinion.

In  our opinion, the financial statements
referred to above present fairly, in all
material respects, the  consolidated
financial position  of  Camelot Corporation
and Subsidiaries as of April 30, 1997, and
the  consolidated results of their
operations and  their consolidated cash
flows for each of the two  years in the
period ended April 30, 1997,  in conformity
with  generally  accepted  accounting
principles.

We  have  also  audited  Schedule  II  of
Camelot Corporation and Subsidiaries for
each of  the  two years in the period ended
April 30, 1997.  In  our opinion,  this
schedule presents fairly,  in  all material
respects, the information required to  be
set forth therein.

Lane Gorman Trubitt, L.L.P.



Dallas, Texas
July 7, 1997

AF-1
<PAGE>
  REPORT OF INDEPENDENT CERTIFIED PUBLIC
                ACCOUNTANT

Board of Directors and Stockholders
Camelot Corporation and Subsidiaries

      I  have  audited the accompanying
consolidated balance sheets of  Camelot
Corporation  and  Subsidiaries  as   of
April   30,   1998  and   the   related
consolidated statements of  operations,
stockholders'  equity, and  cash  flows
for   the   year   then  ended.   These
financial    statements     are     the
responsibility   of    the    Company's
management.   My responsibility  is  to
express  an opinion on these  financial
statements  based  on  my  audit    The
financial    statements   of    Camelot
Corporation  and  Subsidiaries  as   of
April  30,  1997 and the two years  for
the  period ended April 30, 1997,  were
audited by other auditors whose  report
dated   July  7,  1997,  expressed   an
unqualified    opinion     on     these
statements.

     I conducted my audit in accordance
with    generally   accepted   auditing
standards.   Those  standards   require
that  I  plan and perform the audit  to
obtain   reasonable   assurance   about
whether  the  financial statements  are
free  of  material  misstatement.    An
audit  includes examining,  on  a  test
basis,  evidence supporting the amounts
and   disclosures  in   the   financial
statements.   An  audit  also  includes
assessing   the  accounting  principles
used and significant estimates made  by
management,  as well as evaluating  the
overall       financial       statement
presentation.   I  believe   my   audit
provides  a  reasonable  basis  for  my
opinion.

       In  my  opinion,  the  financial
statements  referred to  above  present
fairly,  in all material respects,  the
consolidated  financial   position   of
Camelot Corporation and Subsidiaries as
of April 30, 1998, and the consolidated
results  of their operations and  their
consolidated  cash flows for  the  year
ended  April  30, 1998,  in  conformity
with   generally  accepted   accounting
principles.

     The accompanying financial statements
have been prepared assuming that the
Company will continue as a going concern.
As discussed in Note 15 to the financial
statements, the Company's significant
operating losses raise substantial doubt
about its ability to continue as a going
concern.  The financial statements do not
include any adjustments that might result
from the outcome of this uncertainty.

     I have also audited Schedule II of
Camelot  Corporation  and  Subsidiaries
for the year ended April 30, 1998.   In
my   opinion,  this  schedule  presents
fairly,  in all material respects,  the
information  required to be  set  forth
therein.  The  Schedule II  of  Camelot
Corporation and Subsidiaries  for  each
of  the  two years in the period  ended
April  30, 1997, were audited by  other
auditors  whose report  dated  July  7,
1997,  stated  this  schedule  presents
fairly,  in all material respects,  the
information  required to be  set  forth
therein.

Larry O'Donnell, CPA PC
Aurora, Colorado
July 17, 1998

                    F-1
                   <PAGE>
                   CAMELOT CORPORATION AND
                     SUBSIDIARIES
                     Consolidated Balance
                     Sheets
                        April 30,
<TABLE>
<S>                                               <C>            <C>
                                                  1998           1997
                         ASSETS
                            
CURRENT ASSETS
 Cash and cash equivalents                   $  152,765     $3,029,999
 Securities available for sale                        -        8,268
 Accounts receivable, net of allowance for
   doubtful accounts of $19,947
   at April 30, 1997                             48,156     162,592
 Prepaid expenses                                40,486     167,769
 Inventories, net of allowance for
   obsolescence of $808,581 and $494,744 at
   April 30,1998 and 1997,respectively           50,000     530,926
     Total current assets                       291,407    3,899,554
PROPERTY AND EQUIPMENT - AT COST
 Office equipment and fixtures                        -    1,534,173
 Leasehold improvements                               -       64,154

   Less accumulated depreciation                      -    (669,535)
    and amortization

OTHER ASSETS
 Investments -  in equity of Wincroft, Inc.
                                             7,002,056              -
    less allowance                          (5,936,474)
                                              1,065,582             -

 Note receivable - officer, net of allowance
 of $1,914,216 and $889,000 at April 30, 1998 and 1997
  respectively                                     -             968,189
   Preferred stock-related party                  611,305         530,917
Licenses, trademarks and product
   development, net of accumulated
   amortization of $31,000 at April 30, 1997          -           421,510
          Other                               ________-            23,114
          Total      other     assets         1,676,887         1,943,730

                                             $1,968,294  $  6,772,076
 </TABLE>

 See accompanying notes to consolidated financial statements





                                 F-2
<PAGE>
                   CAMELOT CORPORATION AND
                  SUBSIDIARIES Consolidated
                  Balance Sheets - Continued
                                 April 30,
<TABLE>
<S>                                                 <C>          <C>
                                                   1998          1997
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
 Accounts payable                           $   179,473       $ 470,577
 Accrued expenses                                81,153         222,990
                                                      -            -
     Total current liabilities                  260,626         693,567


STOCKHOLDERS' EQUITY
 Common stock, $.01 par value, 50,000,000 shares
  authorized, 1,784,200 and 881,763 shares
  issued at April 30, 1998 and 1997, respectively   17,842         8,818
 Preferred stock, $.01 par value, 100,000,000 shares
  authorized, and 1,453,400 and 2,438,056 shares issued
  and outstanding at April 30, 1998 and 1997, 
  respectively                                       14,534        24,381
 Additional paid-in capital                      35,768,983    34,021,361
 Accumulated deficit                            (31,256,995)  (25,182,832)
 Less treasury stock, at cost,48,745 and 28,745
            shares at April 30, 1998 and 1997,
            respectively                         (2,755,637)   (2,714,575)
 Less note receivable from officer related to
   purchase of common stock                        (81,059)       (78,644)
     Total stockholders' equity                   1,707,668      6,078,509

                                            $ 1,968,294          $6,772,076
 </TABLE>

See accompanying notes to consolidated financial statements



F-3<PAGE>

<PAGE>

                   CAMELOT CORPORATION AND SUBSIDIARIES
             Consolidated Statements of Operations
                     Years Ended April 30,
                               
  <TABLE>
  <S>                                     <C>            <C>         <C>

                                      1998             1997          1996

  REVENUES                        $   275,435 $  1,887,617     $  3,002,049

  COSTS  AND EXPENSES
     Cost of sales                    143,656       1,559,189      645,127
    General and administrative     3,084,321       7,164,354     6,233,501
    Provision for inventory
     obsolescence                     363,837        495,942      198,000 
      Depreciation and amortization   279,295      1,462,459      354,419
    
     Total costs and expenses       3,871,109     10,681,944     7,431,047

  LOSS FROM OPERATIONS            (3,595,674)    (8,794,327)    (4,428,998)
  OTHER INCOME (EXPENSE)
    Interest and miscellaneous       100,491         426,490        152,278
    Dividend income - related party   46,657            46,657      46,657
   Loss on disposition of assets    (796,664)        (509,292)    (126,931)
   Loss on investment in affiliate  (811,433)   (2,693,087)             -
 Note receivable allowance        (1,025,216)      (889,000)            -
    Realized gain (loss) on sale 
    of marketable securities           7,676    (583,810)              -
    Unrealized gain on marketable
    securities                           -            -              53,821
    Interest expense - related party     -            -            (11,615)

      Total other income (expense)  (2,478,489)   (4,202,042)      114 ,210
   DISCONTINUED OPERATIONS
    Loss from operations                    -           -              -
    Loss on disposals                        -          -        (250,925)
    Loss from discontinued operations      -            -         (250,925)

  NET LOSS                           (6,074,163)  (12,996,369)   (4,565,713)

  LOSS FROM CONTINUING OPERATIONS (6,074,163)   (12,996,369)     (4,314,788)
                               
  DIVIDENDS ON PREFERRED STOCK       (19,200)       (95,234)       (575,414)

  NET INCOME (LOSS) ATTRIBUTABLE TO
      COMMON STOCKHOLDERS        $(6,093,363)  $(13,091,603) $(5,141,127)

    INCOME (LOSS) PER SHARE:
    (LOSS) FROM CONTINUING OPERATIONS   (3.88 )      (20.45)     (12.54) 
  GAIN (LOSS) FROM DISCONTINUED
   OPERATIONS                             (.00)        (.00)       (.73)
    DIVIDENDS ON PREFERRED STOCK        (.01)          (.15)     (1.67)
    NET LOSS PER  COMMON SHARE$        (3.89)$        (20.60)    (14.94)

  WEIGHTED AVERAGE NUMBER OF
     COMMON STOCK AND COMMON STOCK
     EQUIVALENT SHARES OUTSTANDING  1,565,543         635,467   344,119 
 
</TABLE>
  
  See accompanying notes to consolidated financial statements


                              F-4
                               
<PAGE>

                      CAMELOT CORPORATION AND SUBSIDIARIES
           Consolidated Statements of Stockholders' Equity
             - continued For the Period from May 1, 1995
             through April 30, 1998
<TABLE>
<S>            <C>       <C>       <C>          <C>           <C>

               Common  Common Preferred Stock  Preferred  Additional
               Stock    Stock    Shares         Stock     Paid in
               Shares   Amount                 Amount     Capital
               
               
Balance at    290,721  $2,907   189,190        $1,892  $7,750,897 
April 30,
1995

Conversion of
preferred
stock to                
Common stock:   
  Series BB     8,608    86     (888,000)    (8,880)        8,794
  Series G     56,844   569     (5,333,333)  (53,333)       52,764
  Series H     53,709   537     (3,525,000)  (35,250)       34,713

Sale of        54,844     548         -       -          3,281,001
common stock                                            
for cash


Sale of             -       -  19,766,666      197,666  18,850,999
preferred                           
stock for
cash

Common stock
issued for      5,079      51         -       -   737,341
services

Common stock
issued to       1,500      15         -       -    75,141
officers for
note
receivable

Change in net
unrealized          -       -         -       -         -
losses on
available-for-
sale
securities

Retirement of
Series D            -       -  (66,134)      (661)  (65,473)
preferred
stock

Common stock
issued to pay  15,000     150         -       -   449,850
note payable
to related
party

Purchase of         -       -         -       -         -
treasury
stock

Preferred
stock               -       -         -       -  (19,200)
dividends to:       -       -         -       -  (556,214)
  Related                                               
parties
  Other
parties
Net loss            -       -         -       -         -

Balance at
April 30,        486,305 $4,863  $10,143,389 $101,434 $30,600,613
1996 

 See accompanying notes to consolidated financial
statements
                                       F-5
                      CAMELOT CORPORATION AND SUBSIDIARIES
           Consolidated Statements of Stockholders' Equity
           - continued
             For the Period from May 1, 1995 through April
             30, 1998

</TABLE>
<TABLE>
<S>                 <C>       <C>       <C>       <C>       <C>
               Accumul     Unrealize  Treasu     Stock    Total
                ated       d Losses     ry       Subscr  Stockhol
               Deficit         on      Stock      iption   ders'
                           Available             Receiv   Equity
                            For Sale              able    (Deficit)
                           Securities                     
                       
                       
Balance at   $(7,620,750)  $(51,553)  $(170,442)   $-      $(87,049)
April 30,    
1995

Conversion of
preferred
stock to             -          -       -       -         -
common stock:        -          -       -       -         -
  Series BB          -          -       -       -         -
  Series G
  Series H

Sale of
common stock         -          -       -       -  3,281,549
for cash                                                  

Sale of
preferred            -          -       -       -  19,048,665
stock for                                                
cash

Common stock
issued for           -          -       -       -   737,392
services

Common stock
issued to
officers for         -          -       -   (75,156)         -
note
receivable

Change in net
unrealized           -      1,005       -       -     1,005
losses on
available-for-
sale
securities

Retirement of
Series D             -          -       -       -  (66,134)
preferred
stock

Common stock
issued to pay        -          -       -       -   450,000
note payable
to related
party

Purchase of
treasury             -          -  (2,544,133)   -  (2,544,133)
stock                               

Preferred
stock                -          -       -       -     (19,200)
dividends to:        -          -       -       -     (556,214)
 
 Related
parties
  Other
parties

Net loss       (4,565,713)      -       -       -  (4,565,713)

Balance at
April 30,      (12,186,463)  $(50,548) $(2,714,575) $(75,156) $15,680,168
1996             

</TABLE>

     See accompanying notes to consolidated financial statements

                             

                                       F-5

<PAGE>

<PAGE>

                      CAMELOT CORPORATION AND SUBSIDIARIES
             Consolidated Statements of Stockholders'
       Equity - Continued For the Period from May 1,1995 through April 30, 1998
<TABLE>
<S>            <C>         <C>         <C>      <C>       <C>

               Common     Common    Preferred Preferred  Additional
               Stock      Stock       Stock    Stock     Paid in        
               Shares     Amount     Shares    Amount    Capital
                                                 
Balance at     486,305   $4,863     10,143,389 $101,434 $30,600,613
April 30,
1996     

Conversion of
preferred
stock to       
common stock:  
 Series BB     1,922        19         (112,000) (1,120)   1,101
 Series H     165,920     1,659      (9,908,333) (99,083)  97,424
 Series I     144,688     1,447      (1,260,000) (12,600)  11,153
                           

Sale of             -       -         3,590,000  35,900  3,374,600
preferred                         
stock for
cash

Common stock
issued for      1,968      20           -         -            (20)
services

Common stock   80,960     810            -         -         31,574 
issued for
software
acquisitions

Accrued
interest on         -       -       -       -       -
stock
subscription
receivable

Change in net
unrealized          -       -       -       -       -
losses on
available-for-
sale
securities

Retirement of
Series F            -       -  (15,000)     (150)     150
preferred                         
stock

Preferred
stock               -       -       -       -  (19,200)
dividends to:       -       -       -       -  (76,034)    
  Related                                      
parties                                        
  Other
parties

Net loss            -       -       -       -       -

Balance at     
April 30,      881,763   $8,818  2,438,056 $24,381  34,021,361
1997           
</TABLE>


See accompanying notes to consolidated financial
statements



                                       F-6


                      CAMELOT CORPORATION AND SUBSIDIARIES
           Consolidated Statements of Stockholders' Equity
           - Continued
             For the Period from May 1, 1995 through April
             30, 1998
             
<TABLE>
<S>            <C>       <C>           <C>    <C>       <C>
               Accumu      Unreal    Treasu   Stock   Total
               lated        ized       ry     Subscr  Stockh
              Deficit      Losses     Stock  iption  olders 
                             on               Receiv    
                          Availa                able   Equity
                            ble
                            For
                          Sale
                          Securi
                           ties
                    
Balance at  $(12,186,463) $(50,548) $ (2,714,575) $ (75,156) $15,680,168
April 30,  
1996

Conversion of
preferred
stock      to       -       -       -       -       -
common stock:       -       -       -       -       -
  Series BB         -       -       -       -       -
  Series H
  Series I

Sale of             -       -       -       -  3,410,500
preferred                                        
stock for
cash

Common stock
issued for          -       -       -       -       -
services

Common stock        -       -       -       -  32,384
issued for
software
acquisitions

Accrued
interest on         -       -       -  (3,488)  (3,488)
stock                                      
subscription
receivable

Change in net
unrealized          -  50,548       -       -  50,548
losses on
available-for-
sale
securities

Retirement of
Series F            -       -       -       -       -
preferred
stock

Preferred
stock               -       -       -       -  (19,200)
dividends to:       -       -       -       -  (76,034)    
  Related                                      
parties                                        
  Other
parties

Net loss       (12,996,369)  -       -       -  (12,996,369)
              

Balance at   (25,182,832)  $       $(2,714,575  $(78,644) $6,078,509
April 30,    
1997        
</TABLE>


See accompanying notes to consolidated financial
statements



                                       F-6
<PAGE>

<PAGE>

                      CAMELOT CORPORATION AND SUBSIDIARIES
           Consolidated Statements of Stockholders' Equity
           - Continued
             For the Period from May 1, 1995 through April
             30, 1998
<TABLE>
<S>            <C>       <C>       <C>  <C>       <C>

               Common     Common  Preferred  Preferred   Additional
                Stock     Stock   Stock        Stock     paid in 
               Shares     Amount  Shares      Amount    Capital
                                                 

Balance at  881,763     $8,818   2,438,056 $24,381   $34,021,361
April 30, 
1997

Conversion of
preferred
stock to     662,437    6,624  (1,876,920) (18,769        15,270 
common stock:       
  Series L

Sale of                            50                    480,000
preferred                                           
stock for
cash


Sale of
common stock   240,000   2,400                        380,750
for             
cash


Series J
Preferred
stock issued                   892,214         8,922  85,295
for                                 
acquisitions

Accrued
interest on
stock
subscription
receivable

Purchase of
treasury
stock

Sale of                                        800,000
convertible                                         
debentures

Preferred                                      (19,200)    
stock                                              
dividends to:                                   5,507
  Related
parties
  Other
parties-
reverse
  uncleared
payments

Net loss

Balance at      1,784,200   17,842  1,453,400  $14,534  $35,768,983
April 30,       
1998
</TABLE>


See accompanying notes to consolidated financial
statements
                                       F-7
                      CAMELOT CORPORATION AND SUBSIDIARIES
           Consolidated Statements of Stockholders' Equity
           - Continued
             For the Period from May 1, 1995 through April
             30, 1998
<TABLE>
<S>            <C>           <C>        <C>       <C>

               Accumu    Treasury       Stock   Total
               lated     Stock        Subscrip  Stockholders
               Deficit                tion       Equity     
                                      Receivable  

Balance at  $(25,182,832   $ (2,714,575)  $(78,644)  $ 6,078,509
April 30, 
1997

Conversion of
preferred
stock      to                                            3,126
common stock:
  Series L


Sale of
preferred                                               480,000
stock for                                                    
cash


Sale of
common stock                                            383,150
for                                                          
cash
Series J
Preferred
stock issued                                            94,217
for
acquisitions

Accrued
interest on                                   (2,415)  (2,415)
stock
subscription
receivable

Purchase of                 (41,063)                  (41,063)
treasury                                   
stock

Sale of                                                 800,000
convertible                                                  
debentures

Preferred                                               (19,200)
stock
dividends to:
  Related
parties
  Other
parties-
reverse
  uncleared
payments

Net loss       (6,074,163)
               
Balance at     ($31,256,995)    $(2,755,638) $ (81,059)  $1,707,667
April 30,  
1998
</TABLE>

See accompanying notes to consolidated financial statements
                                       F-7
                                       
<PAGE>

                   CAMELOT CORPORATION AND
                   SUBSIDIARIES Consolidated
                   Statements of Cash Flows
                     Years Ended April 30,
     <TABLE>
     <S>                           <C>          <C>               <C>
                                  1998          1997           1996

CASH FLOWS FROM OPERATING ACTIVITIES:
   Net (Loss)                $(6,074,163) $ (12,996,369)  $(4,565,713)
  Adjustments to reconcile net  loss
     to net cash used in operating activities:
   Non  cash transactions for services            -         387,391 
 Accrued  interest  addition to
  related party note  receivable  (2,415)      (60,677)        -
  Securities received as revenue               (64,000)    (1,950,575)
  Depreciation and amortization    279,295    1,462,459       354,419 
  Loss on disposal of assets                    509,292       191,918
  Loss on sale of trading securities           313,896             -
   Gain  loss  on  sale of available for 
   sale securities                             269,914             -
  Write up of securities to market
   value                           (7,676)         -          (53,821) 
  Provision for uncollectible 
   accounts receivable                          8,532            10,887    
 Provision for inventory
   obsolescence                   363,837      495,942        198,000
  Note receivable allowance     1,025,216       889,000
  Loss on investment in affiliate               2,693,087         -
  Proceeds from trading securities  (738,480)   1,027,612        -
  Change in assets and liabilities, net of effect from
     purchase of subsidiaries:
     Accounts receivable              114,436       (68,987)  (212,107)
      Prepaid expenses                 127,283      47,304    (183,449)
Inventories                            87,664     246,105    (864,908)
      Other assets                      23,114        -            -
Accounts payable and accrued expenses (432,941)  (277,943)     88,151 
Obligations  -
discontinued
operations                           _________-   (50,185)    (140,266)
Net cash used in operating activities(3,757,870) (5,555,018) (6,740,073)
CASH FLOW FROM INVESTING ACTIVITIES:
  Purchases of property and equipment(84,583)      (636,364) (1,087,658)
  Investment in affiliate              13,829    (2,457,003)     -
  Collections received on notes receivable          14,000
   Proceeds from sale of property and equipment     -              11,500
   Proceeds from available for sales
    securities                       391,042        718,143        93,447
  Purchases available for sales
    securities                      (375,098)
  Proceeds from return of deposits                       -         14,765
   License, trademarks and product 
    development                     (619,047)      (412,510)      (608,800)
   Issuance of note receivable 
     - related party                (57,027)     (1,814,000)            -
  Issuance   of   note  receivable   ____-                        (312,400)
 Net cash  (used in) investing 
   activities                     ( 730,884)     (4,587,734)    (1,889,146)
CASH FLOWS FROM FINANCING ACTIVITIES:
  Sales of common stock              383,150               -      3,281,549
  Sale of preferred stock           1,283,125      3,410,500     19,048,665
  Redemption of preferred stock             -           -           (66,134)
  Deferred offering costs                           (13,114)            -
  Dividends paid                     (13,692)       (95,234)     (575,414)
  Purchase of treasury stock         (41,063)           -      (2,544,133)
  Payments on debt                                         -     (294,200)
   Proceeds  (payment)
    - notes payable -  related  parties                          (236,000)
   Redemptions  of  subsidiary
    preferred stock_________                                     (264,044)
   Net  cash provided by financing
   activities                        1,611,520      3,302,152    18,350,289
NET INCREASE (DECREASE) IN CASH  (2,877,234)     (6,840,600)      9,721,070
CASH  AT BEGINNING OF YEAR          3,029,999       9,870,599    149,529
CASH AT END OF YEAR             $    152,765    $  3,029,999   $ 9,870,599
</TABLE>

See accompanying notes to consolidated financial statements
                              F-8
                               
     <PAGE>

                   CAMELOT CORPORATION AND SUBSIDIARIES
                   Consolidated Statements of Cash Flows Years
                           Ended April 30,
     <TABLE>
     <S>                      <C>            <C>            <C>
                                   1998      1997          1996
     Supplemental information:
        Cash  paid for interest$   -     $       -    $   11,615

        Cash  paid for income taxes$  -  $    -       $       -
     </TABLE>

     NONCASH INVESTING AND FINANCING ACTIVITIES

 In fiscal 1998, the Company's Preferred Stock was converted to
                               the
     Company's restricted common stock as follows;

      24 Series L for 1,407,285 shares of restricted common
          453,080 Series I for 9,049,629 shares of common
   In fiscal 1998 as discussed in Note 7, the Company sold its
                            VideoTalk
  business for a note receivable and preferred and common stock
                              with
     assets valued at $1,065,582.

     In fiscal 1998, the Company acquired stock of Alexander
     Mark Investments (USA), Inc. (which later changed its name
     to Wincroft, Inc.) for issuance of preferred stock valued
     at $94,217.  In March, 1998 the Company exchanged its
     shares in Alexander Mark Investments (USA), Inc. for 8%
     Preferred Shares of  Forsam Venture Funding , Inc..
     
     As  discussed in Note 11, in fiscal 1997 the Company's
     Preferred  Stock was converted to the Company's restricted
     common stock as follows:
     
          112,000 Series BB Preferred for 1,922 shares of
           restricted common 9,908,333  Series  H Preferred for
           165,920 shares  of  restricted
     common
           1,260,000  Series  I Preferred for 144,688 shares  of
     restricted common
     In  fiscal  1997,  the Company received securities  in  the
     amount  of $139,700 in satisfaction of a trade account
     receivable.
     In  fiscal 1997, the Company issued 80,960 shares of
     restricted  common stock for software acquisition.
     As  discussed  in  Note 9, in fiscal 1996, the Company
     issued  15,000 shares  of  restricted  common  stock in
     settlement  of  $450,000  of promissory notes to a related
     party, Forme Capital, Inc.
     In  fiscal 1996, the Company issued 1,687 shares of
     restricted  common stock, with an agreed value of $350,000,
     for acquisition of software.
     As discussed in Note 11, in fiscal 1996, the Company's
     Preferred Stock was converted to the Company's  common
     stock as follows:
        888,000 Series BB Preferred for 8,608 shares of common
    5,333,333 Series G Preferred for 56,844 shares of common
    3,525,000 Series H Preferred for 53,709 shares of common
                                
     As  discussed  in Note 14, in fiscal 1996, an officer of
     the  Company executed a 6% interest bearing note in the
     principal amount of $75,156 to exercise stock options.
     
     In  fiscal 1996, the Company exercised its option to
     purchase  400,000 shares  of  stock  in  another  company
     in  satisfaction  of  a  note receivable in the amount of
     $312,400.
     
      In  fiscal  1996, the Company issued notes payable in the
amount  of $294,200 for acquisitions of software.

     During fiscal 1997 and  1996 there was a $50,548 and
     $1,005, change in net unrealized losses on available-for-
     sale securities.
     
     See accompanying notes to consolidated financial statements
                               F-9
<PAGE>
                   CAMELOT CORPORATION AND SUBSIDIARIES
                       NOTES TO FINANCIAL
STATEMENTS
1.   SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES

     Business Activity and Principles of
Consolidation

The  consolidated financial statements include the Company and
its majority owned subsidiaries (collectively the "Company").
      The  Company is now inactive and all its operating
subsidiaries  have discontinued  operations.  During the
financial  period  under  review  the Company  was  primarily
engaged in research and  development  of  Internet software
and  hardware  and the retailing of computer  software  over
the Internet.  Discontinued operations of subsidiaries were
involved in selling software  products  through retail stores
located in the Dallas  metroplex, the  provision  of  Internet
services, video marketing  and  distribution, financial
services,  real  estate rentals, and oil  and  gas
development. Significant intercompany accounts and transactions
have been eliminated.
     Cash and Cash Equivalents
      The  Company  considers all highly liquid investments
with  original maturities of three months or less to be cash
equivalents.  The company and its  subsidiaries maintain cash
balances at several financial  institutions and  a  brokerage
firm in Carrollton, Texas.  Cash equivalents are composed
primarily  of investments in a money market account.  The
Company  believes it  is  not  exposed  to  any significant
credit  risk  on  cash  and  cash equivalents.
     Inventories
      Inventories of computer software held for resale, are
stated  at  the lower                        of  cost  or
market  using the weighted  average  cost  method.  An
allowance  for  inventory  obsolescence is maintained  to
provide  for  an estimate of inventory items that have declined
in value.

     Property and Equipment

       Property  and  equipment  are  carried  at  cost,  less
accumulated depreciation.   Major  additions  and  betterments
are  capitalized  while replacements and maintenance and
repairs that do not improve or extend  the life  of  the
respective assets are expensed.  Leasehold improvements  are
amortized over the lesser of the term of the related lease or
the estimated useful lives of the assets.  When property is
retired or otherwise disposed of,  the  related costs and
accumulated depreciation are removed  from  the accounts and
any gain or loss is reflected in operations.

     Depreciation and amortization of property and equipment is
provided on the straight-line method over the following
estimated useful lives:

          Office furniture and fixtures           7 years
          Computer and office equipment          5 years 
          Computer software                      5 years
Leasehold Improvements    Length of lease  ranging to 5 years

     Software Development

       Certain   software  development  costs  are  capitalized
upon the
establishment of technological feasibility for each product or
process  and capitalization ceases when the product is
available for general release  to customers  or  is  put  into
service.  The establishment  of  technological feasibility  and
the ongoing assessment of recoverability  of  capitalized
software development costs require considerable judgment by
management with respect  to  certain  external  factors,
including,  but  not  limited  to, anticipated  future
revenues,  estimated  economic  life  and  changes  in software
and hardware technology.  Research and development costs
related to  software development that has not reached
technological feasibility are expensed as incurred.

F-10<PAGE>

             CAMELOT CORPORATION AND SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued
Software development costs are amortized utilizing the straight-
line method over the estimated economic lives of the related
products not to exceed two years.  Amortization of capitalized
software costs for April 30, 1998, 1997 and  1996  was
$86,703,  $1,105,021  and  $138,979,  respectively,   which
included  a  write down of $0 in 1998, and $646,408 in 1997 to
reflect  an impairment of net realizable value.  Capitalized
software development costs were $0 and $302,510 at April 30,
1998 and 1997, respectively.
Total  research and development costs charged to general and
administrative expenses  were  approximately $261,000,
$2,375,000 and $1,319,000  for  the years ended April 30, 1998,
1997 and 1996.
     Trademark and Licenses
      Trademarks  and  licenses  are stated at  cost,  net  of
accumulated amortization, which is provided using the straight-
line method over 5 to 10 years.
     Store Preopening Costs
      Store  preopening  costs are capitalized and  amortized
over  twelve months.
     Loss Per Share
Loss  per  common  share is computed on the basis of the
weighted  average number   of  common  shares  outstanding
during  the  respective  periods. Outstanding stock warrants,
options and preferred shares are excluded  from the
computations as their effect would be anti-dilutive.
During 1998, common shares were issued upon conversion of
preferred shares. Had this conversion of preferred stock
occurred on May 1, 1998 net loss per common shares would have
been $3.69 for 1998.
      During  1997,  312,530 common shares were issued upon
conversion  of preferred shares.  Had this conversion of
preferred stock occurred  on  May 1, 1996, net loss per common
share would have been $16.71 for 1997.


      During  1996,  119,161 common shares were issued upon
conversion  of preferred shares and 15,000 common shares were
issued to retire debt.   Had this  conversion of preferred
stock and the retirement of debt occurred  on May 1, 1995 net
loss per common share would have been $11.20 for 1996.


     Software Revenue Recognition

      Revenue  from sales of software is generally recognized
upon delivery of  the  software  provided  that  no significant
obligations  remain  and collection of the resulting receivable
is deemed probable.

     Advertising Costs

      Advertising  costs, included in general and
administrative  expenses, are  charged to operations when the
advertising first takes place and  were $27,924, $989,248, and
$1,648,071 for  1998, 1997 and 1996, respectively.

     Income Taxes

      Deferred income taxes are determined using the liability
method under which  deferred  tax  assets  and liabilities  are
determined  based  upon
differences between financial and tax basis of assets and
liabilities.
                                   F-11
     <PAGE>
                   CAMELOT CORPORATION AND SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
                               
                               
1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

     Fair Value of Financial Instruments

      Fair value of financial instruments are estimated to
approximate  the related book value, unless otherwise
indicated, based on market information available to the
Company.

     Impairment of Long-Lived Assets

      Impairment  losses  are  recorded on long-lived  assets
and  certain identifiable intangible assets held and used in
operations whenever  events or  changes in circumstances
indicate that the carrying amount of an  asset may not be
recoverable.

     Use of Estimates

      In  preparing  financial  statements  in  conformity
with  generally accepted  accounting principles, management is
required to  make  estimates and assumptions that affect the
reported amounts of assets and liabilities, the  disclosure  of
contingent assets and liabilities at the  date  of  the
financial  statements,  and the reported amounts of revenues
and  expenses during  the  reporting  period.  Actual results
could  differ  from  those estimates.

2.   ACQUISITIONS

      On  March  31,  1997, a wholly-owned subsidiary of  the
Company  was formed.   The  Company  acquired 100% of the
common stock  of  mrcdrom.com, inc.,  in exchange for $100,000
in cash, $511,428 of inventory, $30,464  of equipment  and
$26,000 of other assets.  mrcdrom.com, inc. is  engaged  in
selling  software products through an Internet web page
catalog.  In  March 1997,  the  Board  of  Directors  approved
the  filing  of  a  registration statement  under  the
Securities Act of 1933, for  a  public  offering  of 3,000,000
shares  of  mrcdrom.com, inc. common  stock.   The
registration statement was later withdrawn.

3.   ACCOUNTS RECEIVABLE AND CREDIT RISK

      The  Company's  trade  receivables at April 30,  1998
and  1997  are primarily  due  from  major  computer software
distributors.      The  Company
believes it is not exposed to significant credit risk.



                             F-12
<PAGE>
                   CAMELOT CORPORATION AND SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
                               
                               
4.   INVENTORIES

Included  in the accompanying April 30, 1998 balance sheet is
inventory  of computer software  at  a  carrying  value  of
$50,000  which  represents
management's  estimate of its net realizable value.  The
computer  software
industry  is  characterized by rapid technological advancement
and  change. Should demand prove to be significantly less than
anticipated, the ultimate realizable  value of such products
will probably be less  than  the  amount shown in the balance
sheet.
Major classes of inventories consist of the following at April
                             30,:
<TABLE>
<S>                                     <C>            <C>
                                      1998                 1997
     Software                       $908,581        $1,025,670

     Less: Allowance for slow moving
            and obsolescence            858,581         494,744

     NET                           $50,000        $  530,926
</TABLE>

5.   MARKETABLE SECURITIES

      The  Company  adopted, effective for the year ended April
30,  1995, Statement of Financial Accounting Standards No. 115
"Accounting for Certain Investments  in  Debt  and  Equity
Securities".   Under  this   statement, investments  in
available-for-sale securities are measured  at  fair  value
with  net unrealized gains and losses reported in equity.
Investments that are bought are held principally for the
purpose of selling them in the near future  are  classified  as
trading securities.   Trading  securities  are measured at fair
value with net realized gains and losses reported  in  the
statement  of  operations.   The fair value  of  marketable
securities  is determined  based  on quoted market prices for
those securities.   The  net unrealized  holding  loss
decreased by and $50,548 and  $1,005  during  the years  ended
April 30, 1997 and 1996 respectively.  The  cost,  unrealized
gains  and  losses,  and  fair  values of the Company's
available-for-sale securities  and  trading  securities at
April 30, 1997  are  summarized  as follows:
<TABLE>
<S>                      <C>       <C>            <C>       <C>
                Cost      Gross       Gross     Estimated
                        Unrealized
                          Unrealized    Fair
                          Gains       Losses
                          Value
                          
1997

Available-
for- sale

Securities
               $ 8,268   $       -   $-   $  8,268 
Common

stock





</TABLE>





F-13<PAGE>
                   CAMELOT CORPORATION AND
                       SUBSIDIARIES NOTES TO
                       FINANCIAL STATEMENTS
                       
5.  MARKETABLE SECURITIES - Continued

     Sales proceeds and gross related gains
and losses on securities are as follows:
<TABLE>
<S>                                <C>
<C>       <C>
                   1998        1997       1996
     Cost basis  $383,366  $2,329,565   $134,480
     Proceeds     391,042   1,745,755      93,447 
     Realized     27,135       -           -
     gains
     Realized      19,459     583,810     41,033
     losses
</TABLE>

      The Company uses the specific identification method to
determine  the cost of securities sold.
     Results of operations for 1998, 1997 and 1996 include a
charge of $ -0$-0- and $53,821 for unrealized gains on trading
securities.
     Stockholders' equity includes an unrealized loss of $0, $0
and $50,548 at April 30, 1998 and 1997 and 1996,  respectively.
6.   NOTE RECEIVABLE - OFFICER
      During  fiscal  1997,  the Company loaned  the  President
and  Chief Executive  Officer of the Company $1,800,000.  The
loan is evidenced  by  a nonrecourse  note,  which  bears
interest at 6%,  with  all  principal  and accrued  interest
due  November 14, 2006.  The note is  collateralized  by
approximately  33,500 shares of common stock of the  Company
which  had  a market  value  of $1,800,000 on September 25, 1996
and is  not  subject  to additional calls for security
regardless of any changes in the value of the stock.  At April
30, 1998, these shares had a market value of approximately
$3,115.   The allowance of $1,914,216, which includes the
interest  on  the note is to provide for impairment of the
collateral.
7.   INVESTMENT IN AFFILIATE
      In  May,  1997, the Company acquired 80% of the
outstanding stock  of Alexander  Mark  Investments, USA, Inc.
(which later changed  its  name  to Wincroft,  Inc.).  In
March, 1998, the Company  exchanged  its  shares  in Alexander
Mark  Investments, USA, Inc. for 8% preferred shares  of  Forsam
Venture Funding, Inc.

      An  officer  of  the Company is a director of Forsam.
The  carrying amount  of  the investment is $80,388.  The
investment will be  carried  at cost.

     On March 31, 1998, the Company's wholly owned subsidiary,
Third Planet Publishing,  Inc.  sold all right, title and
interest in VideoTalk  product for  $7,002,056  which was paid
by issuance of common and  preferred  stock valued  at
$5,002,056 and a promissory note for $2,000,000.  On  June  29,
1998, the Company agreed to satisfy the promissory note for
preferred stock and  the Company is treating the transaction as
if it accrued at year  end. This  investment will be accounted
for using the equity method because  the Company  will own 20%
of Wincroft, Inc.  The investment has been valued  at the net
book value of the assets transferred, which is $1,065,582.

  At  April, 1997, the Company holds a 15.2% interest in Meteor
Technology, plc           ("Meteor"),  a
public  telecommunications  company  traded  on                         the
Alternative Investment Market of the London Stock Exchange.  The
investment is  accounted  for  under the equity method because
the  Company  exercises significant influence of Meteor's
operating and financial activities.                                     Due
to  certain factors, the Company has determined that the
carrying value  of its  investment  exceeds  the  estimated
recovery  value.   Accordingly,  a provision of $2,693,087 has
been charged to operations in 1997 reducing its carrying  value
of  Meteor  to  $0  and suspended  the  equity  method  of
accounting for its investment in Meteor.


8.   ACCRUED EXPENSES
     The following is a summary of accrued expenses
at April 30,: <TABLE>
<S>                                  <C>           <C>
                                    1998          1997
     Taxes                       $29,811       $26,811
     General and administrative   36,077         2,452
     Fees                         15,265        34,000
     Compensation                      -        41,503
     Lease obligations                 -       115,099
     Other                      _______-         3,125
                               $  81,155    $   222,990
</TABLE>


                                   F-14
<PAGE>
                   CAMELOT CORPORATION AND
SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
9.   NOTES PAYABLE - RELATED PARTY
      In  fiscal 1996, the remaining balance of the notes
payable to  Forme Capital,  Inc.  (Forme), a corporation
majority-owned by the  wife  of  the President  of  the
Company was settled by payment  of  $236,000  cash  and
issuance  of 15,000 shares of the Company's restricted common
stock  valued at  $450,000.   The  weighted  average  interest
rate  on  the  short-term borrowings was 8%.
10.  INCOME TAXES
      The Company files a consolidated Federal tax return.  The
Company had no  current State or Federal income tax expense for
each of the years ended April 30, 1998, 1997 and 1996.
      Deferred  tax  assets  and liabilities are determined
based  on  the difference  between  financial  statement  and
tax  basis  of  assets  and liabilities  as measured by the
currently enacted tax rates.  Deferred  tax expense or benefit
is the result of the changes in deferred tax assets  and
liabilities.
     Deferred income taxes arise principally from the temporary
differences between  financial statement and income tax
recognition  of  allowance  for doubtful   accounts,   note  receivable
allowance,  investment   valuation
adjustments, inventory reserve and from net operating losses.

      The  components  of deferred taxes at April 30, in  the
accompanying balance sheets are summarized below:
<TABLE>
<S>                                            <C>       <C>
                                              1998    1997

       Allowance  for  doubtful  accounts    $   - $   6,782
Inventories                                  291,000 168,213
Other                                        4,000     3,958
     Note receivable allowance               651,000  302,260
Investment valuation adjustment       1,191,000      915,650
     Capital loss carryforward          115,000    117,817
     Net operating loss carryforward     8,800,000  6,862,390
                                        11,052,000  8,377,070

     Less valuation allowance           (11,052,000) (8,377,070)
               Deferred tax asset-net   $     -      $    -
</TABLE>
     At April 30, 1998, the Company has approximately
$26,000,000 of unused Federal  net operating loss
carryforwards, which expire in the  years  2003 through 2013.
     Approximately $640,000 of the net operating loss
carryforwards for tax purposes  are limited due to statutory
changes in the tax law in connection with the change in more
than 50% ownership of the Company in 1988.  Because of
statutory  requirements in the law, that portion of the  net
operating loss carryforward applicable to the period prior to
the ownership change is limited to use of approximately $35,800
per year until it expires.  As  the net  operating losses
expire, at a minimum, approximately $425,000  of  the tax net
operating loss carryforward will not be available for the
Company's future use.




                             F-15
<PAGE>
                   CAMELOT CORPORATION AND SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
                               
11.  STOCKHOLDERS' EQUITY

     Common Stock

      The  brother  of the President of the Company purchased
100,000  and 13,750  shares  of the Company's restricted common
stock for  $278,150  and $470,312 in various transactions
during fiscal 1998 and 1996, respectively.

      Unrelated  third parties purchased 140,000 and 16,094
shares  of  the Company's restricted common stock for $105,000
and $795,612 and in  various transactions during fiscal 1998
and 1996, respectively.

      During fiscal 1996, a company affiliated with the
President purchased 13,750 shares of the Company's restricted
common stock for $1,108,594.

During  fiscal 1996, the President purchased 11,250 shares of
the Company's restricted common shares for $907,031.

     Preferred Stock

The  Company has 100,000,000 authorized shares of $.01 par
value  preferred stock  with rights and preferences as
designated by the board of  directors at the time of issuance.
The Company has the following series of preferred stock issued
and outstanding at April 30, 1998:
<TABLE>
<S>  <C>                 <C>                 <C>       <C>      <C>
                       Number of Shares
                               
                               
     Series of           Originally
             Preferred        Stock            Authorized
Issued
OutstandingValue

              A                      2,000             2,000  -    -
              B                     75,000            75,000  -    -
              C                     50,000            50,000  -    -
              D                     66,134            66,134  -     -
           E                  108,056         108,056   108,056     1,081
             F                    15,000            15,000    -       -
              BB                 1,000,000         1,000,000  -       -
              G                  5,333,333         5,333,333  -       -
              H                 17,000,000        13,433,333  -       -
            I                10,000,000        3,590,000  453,080  4,531
                J                60,000,000           892,314  892,214 8,922
               K                   412,000           412,000    0       -
              L                   500,000           500,000     24  240,000

     TOTAL               94,061,523     24,977,170  1,453,400     $ 14,534

      During fiscal 1998, 26 shares of Series L were converted
to 1,407,285 shares of common stock.

      During  fiscal  1998, 453,080 shares of Series I  were
converted  to  9,049,629 shares of the Company's common stock.

     During fiscal 1997,112,000 shares of Series BB were
converted to 1,922 shares of the Company's restricted common
stock.

      During  fiscal 1997, 9,908,333 shares of Series H were
converted  to
165,920 shares of the Company's restricted common stock.

      During  fiscal 1997, 1,260,000 shares of Series I were
converted  to
144,688 shares of the Company's restricted common stock.

     During fiscal 1997, 15,000 shares of Series F were
retired.


                             F-16
                               
<PAGE>

                   CAMELOT CORPORATION AND SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
                               
11.  STOCKHOLDERS' EQUITY - Continued

During  fiscal  1996,  the Series G shares outstanding  were
converted  to
56,844 shares of the Company's restricted common stock.

      During  fiscal  1996, 888,000 shares of Series BB were
converted  to
8,608 shares of the Company's restricted common stock.  During
fiscal 1996, 3,525,000  shares  of  Series H were converted  to
53,709  shares  of  the Company's restricted common stock.

      During fiscal 1996, the outstanding shares of Series D,
owned by  the wife of the President, were redeemed for $66,134.

Series E preferred shares owned by a trust affiliated with the
President of the  Company          are entitled to
receive a cumulative dividend  equivalent  to
$1,600  per  month.  Dividends in the amount of $19,200 were
declared  and paid each of the years ended April 30, 1998, 1997
and 1996.

      Series  BB preferred shares ("Series BB") are entitled to
receive  a
dividend of 12% payable quarterly.  The Series BB are
convertible to common shares  at  thirty  percent off the
closing price  of  the  common  shares.
Dividends in the amount of $70,040 were paid in 1996.
      Series  G  preferred shares ("Series G") are entitled  to
receive  a dividend  of 9% payable quarterly.  The Series G are
convertible to  common shares  at twenty percent off the
closing price of the common shares.                                     All
shares  will automatically be converted into common shares two
years  after issuance.  Dividends in the amount of $139,151
were paid in 1996.

      Series  H  preferred shares ("Series H") are entitled  to
receive  a dividend  of 9% payable quarterly.  The Series H are
convertible to  common shares  at  twenty  percent off the
closing price  of  the  common  shares. Dividends in the amount
of $76,034 and $225,055 were paid in 1997 and 1996,
respectively.

      Series  I  preferred shares ("Series I") are entitled  to
receive  a cumulative  dividend of 7%, payable in common shares
of the  Company.   The
Series I are convertible to common shares at twenty percent off
the closing price  of  the  common shares.  All shares will
automatically be  converted into common shares two years after
issuance.


Series L preferred shares ("Series L") are entitled to receive
a cumulative dividend of 7%, payable in common shares of the
Company.  The Series L  are convertible to common shares at
twenty percent off the closing price of the common  shares.
All  shares will automatically be converted  into  common
shares two years after issuance.

Any split or combination of common shares requires a
simultaneous split  or combination  of  each  series of
preferred shares  and  visa  versa.   Upon liquidation  or
dissolution of the Company,  holders  of  each  series  of
preferred shares are entitled to receive, to the extent of
their par value, pro  rata  with other preferred shareholders
and before holders  of  common shares,  all  assets  legally
available for distribution  to  stockholders. Each  series  of
preferred shares issued as of fiscal  year-end   is  nonvoting.

12.  STOCK OPTIONS

     Camelot Corporation

      The Company adopted the 1991 Employee Stock Option Plan
(the Plan) in April  1992,  reserving  3,750 shares of the
Company's  common  stock  for issuance upon the exercise of
options granted under the Plan.  On April 30, 1993,  the  board
amended and the shareholders approved  to  increase  the number
of common shares to 16,250 available for issuance under this
plan. The  options  may be purchased as Incentive Stock Options
at 100%  of  fair market  value of the common stock or as
supplemental stock options  at  not less  than 85% of the fair
market value of the common stock at the date  of grant.




                             F-17
<PAGE>

                   CAMELOT CORPORATION AND SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
                               
                               
                               
12.  STOCK OPTIONS - Continued

      The terms of the options under the Plan may not exceed 10
years.   No options  may be granted under the Plan after April,
2002.  The Company  has determined  to  use  the 1991 Employee
Stock Option Plan  for  non-employee
directors and has amended the Plan to specifically cover
directors.   Other than            a  name change to the 1991
Outside Director Stock Option Plan and  as
set out above, the Plan will otherwise stay the same.

      In  October 1996 the Company adopted the 1996 Stock
Option Plan.   At that             time the Company canceled
all outstanding options from the 1991  plan
and  granted  the  equal number of options from the 1996  plan.
The  plan
reserves 200,000 shares of the Company's common stock upon
exercise of  the options  granted  under the plan.  The
exercise price for  the  options  is equal  to  the Fair Market
Value of a share of  Common Stock on  the  Grant Date.   The
per share exercise price of any option granted to a person  who
at  the  time  of grant owns stock possessing more than 10%  of
the  total combined voting power of all classes of stock of the
Company or any  parent or  subsidiary corporation of the
Company must be at least 110% of the fair market value of a
share of the Company's common stock on the date of grant, and
the term of such option cannot exceed five years.

      The  term of the options under the 1996 plan may not
exceed 10 years. No  options may be granted under the Plan
after October 2006.  During 1997, the exercise price of the
options granted under the 1991 and 1996 plans was changed to
$5.00 per share.

      Under the 1996 plan, 175,000 options were granted to the
President of the                   Company, however he was not
eligible for options under the 1991  plan.
An additional 3,500 options were granted to officers during
fiscal 1997.

Outstanding stock options outside the Plan were 86,250 and
86,250 at  April 30, 1998 and 1997, respectively.

     The following schedule summarizes the changes in the
Plans:

</TABLE>
<TABLE>
<S>                                     <C>       <C>       <C>
                               1998       1997       1996

Options outstanding  at    275,388     94,600     95,825
beginning at year
   Granted                 183,563    185,538      7,194
   Exercised                     - -  (  4,637) 
   Canceled              (176,576)   (4,750)  (  3,782) 
  Options outstanding  at 282,375      94,600  275,388
end of year



Options exercisable  at    282,375     275,388     94,600
end of year

Average    price     of
options:
   Granted during year      $2.063   $ 49.348    $98.324
     Exercised   during          -        -     62.208
year
   Canceled during year     12.160     52.160     80.140
    Outstanding at  end      2.063      12.160     31.828
of year

</TABLE>





                                   F-18

<PAGE>

                   CAMELOT CORPORATION AND
                       SUBSIDIARIES NOTES
                       TO FINANCIAL
                       STATEMENTS
12.  STOCK OPTIONS - Continued
mrcdrom.com, inc.
mrcdrom.com,  inc.  has approved two stock option plans, a
1997  Incentive Stock  Option  Plan  (the  "Incentive Stock
Option  Plan")  and  the  1997 Directors' Stock Option Plan
(the "Director's Stock Option Plan") in  March 1997,  reserving
500,000  shares of common stock  for  issuance  upon  the
exercise  of  options granted under the Plans.  The Incentive
Stock  Option Plan is available to all employees of
mrcdrom.com, inc. (including officers and employee directors).
The Director's Stock Option Plan is available for all
nonemployee directors of mrcdrom.com, inc.  The option exercise
price is  equal to the fair market value of a share of common
stock on the  grant date unless the optionee is granted more
than 10% of the maximum number  of shares  available for
issuance under the Plans in which case  the  exercise price  is
equal to 110% of the fair market value of a share of common
stock on  the  date  of grant.  The term of the options under
the Plans  may  not exceed 10 years.
The following schedule summarized the changes in the Plans:
<TABLE>
<S>                                <C>            <C>       <C>
Incentive Stock Option Plan

                                  1998          1997        1996

Options outstanding at
beginning of year
     Granted                        408,800     408,800           -
     Exercised                            -           -           -
     Canceled                             -           -           -
Options outstanding at end         (14,760)     408,800           -
of year

Options exercisable at end          394,040     408,800           -
of year

Average price of options
     Granted during year                  -       $4.00       $    -
     Exercised during year                -           -           -
     Canceled during year             $4.00           -           -
     Outstanding at end of            $4.00        4.00           -
year
</TABLE>
<TABLE>
<S>                           <C>            <C>               <C>
Director's Stock Option Plan

                                 1998         1997              1996

Options outstanding at
beginning of year
     Granted                      15,000      15,000             -
     Exercised                         -           -             -
     Canceled                    (5,000)          -              -
Options outstanding at end        10,000      15,000              -
of year

Options exercisable at end        10,000      15,000             -
of year

Average price of options
     Granted during year               -       $4.00       $    -
     Exercised during year             -           -           -
     Canceled during year          $4.00           -           -
     Outstanding at end of         $4.00        4.00           -
year
</TABLE>



                                   F-19
                   CAMELOT CORPORATION AND
SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
                               
12.  STOCK OPTIONS - Continued

The Company granted stock options to purchase 423,800 shares of
mrcdrom.com common stock to officers and directors of
mrcdrom.com, inc. during 1997.

The  Company  recognized and measures compensation costs
related  to  stock option  plans utilizing the intrinsic value
based method.  Accordingly,  no compensation  cost  has  been
recorded.   Had  compensation  expense  been determined on the
fair value of awards granted, net loss and loss per share would
have been as follows:
<TABLE>
<S>                      <C>            <C>
                              1998

                    As Reported           Pro forma

     Net loss       $(6,074,163)        $(6,538,653)

     Loss per share $     (3.88)   $     (4.18)

                              1997

                    As Reported         Pro forma

     Net loss       $ (12,996,369)      $ (13,441,659)

     Loss per share $      (20.45)      $      (21.15)




                              1996
                     As Reported   Pron forma
        Net Loss    $(4,565,713)  $(4,928,278)

Loss per share        (12.54)    (14.32)

</TABLE>





      The  fair  value of each option is estimated using the
Black-Scholes option-pricing  model with the following
assumptions  used  for  grants  in 1998,  1997 and 1996: risk
free interest rate 4.5%; expected life 10 years; expected
volatility 30%; dividend yield 0%.  The fair values generated
by the  Black-Scholes  model may not be indicative of the
future  benefit,  if any, that may be received by the option
holder.


13.  MINORITY INTEREST


      During  the  year ended April 30, 1995, a subsidiary of
the  Company authorized  15,000,000 shares of $.01 par value
preferred stock.   Proceeds
from  the  sale of issued shares, net of expenses of $39,456,
was $264,044. During  fiscal  1996,  the  Company purchased
60,700  shares  of  the  10% Convertible  Preferred  Shares,
Series A.  The  10%  Convertible  Preferred Shares,  Series A,
have one vote per share, and no preemptive rights.                      The
dividend is cumulative and must be paid before any dividends
can be paid to the  common  shareholders.  The Preferred shares
have  a  preference  upon liquidation  over the Common shares.
The Preferred shares are  convertible at  a  rate of one
Preferred share for each Common share.  The Company  has the
right to redeem the Preferred shares within twelve months of
issuance at  $6.00  per  share  and the second twelve months
for  $6.60  per  share. Dividends  in  the amount of $121,968
were paid in 1996.  All  shares  were redeemed in fiscal year
1996.

14.  RELATED PARTY TRANSACTIONS

      During  fiscal  1997, the Company made a loan to an
officer  in  the amount of $14,000 bearing interest at 6% which
has been repaid as of  April 30, 1997.
                             F-20
                   CAMELOT CORPORATION AND SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
                               
                               
14.  RELATED PARTY TRANSACTIONS - Continued

      During  fiscal  1997,  the Company concluded agreements
with  Meteor Technology  plc ("Meteor"), appointing them as the
exclusive  international distributor for DigiPhone and
DigiPhone Deluxe, excluding the United States of  America,
Canada, the United Kingdom and Ireland.  The consideration for
the  DigiPhone  rights was (british pounds) 6,000,000, (approximately
$9,312,000)  and  an additional  (british pounds)1,000,000  in  loan  stock
was subscribed  to,  (approximately $1,685,000).   During
fiscal 1997, the Company  acquired  the  U.S.A.  and Canadian
rights  to  PCAMS  software, which is  a  payphone  contract
and management  system software from Meteor.  The consideration
for  the  PCAMS software   rights  was  the  cancellation  of
(british pounds)2,000,000  of  loan   stock (approximately  $3,370,000)  and
the issuance  of  80,960  shares  of  the Company's restricted
common shares.  The remaining loan stock was converted into
ordinary shares of Meteor, with the Company owning
approximately      15.2%
of  Meteor.   Because  of the significant influence the
Company  has  over Meteor,  the  Company  has accounted for
these transactions  as  an  equity investment  in Meteor.  See
footnote 7 discussing the Company's  investment in Meteor.

In  fiscal year 1996, the Company made a loan to DigiPhone
Europe, Ltd.,  a subsidiary of Meteor for $30,000.  The
Chairman and Chief Executive Officer of Camelot is a majority
stockholder of Meteor at April 30, 1997.  Sales of software
products to Meteor were $141,905 during fiscal 1997.

The  Company  received management fees of $54,000, $72,000 and
$24,000  for the  years  1998,  1997 and 1996, respectively,
from a securities  transfer agent company affiliated with the
President of the Company.

During fiscal 1996, an officer of the Company was given the
opportunity  to execute  a  6%  interest bearing note in
principal  amount  of  $75,156  to exercise stock options.  The
note receivable, which is collaterized by  the pledge of 1,500
shares of common stock of the Company is due on January 18,
1998.

      The  Company received loans from Forme Capital totaling
$406,000  in fiscal  year 1995.  Payments of $236,000 and
$190,000 were made  in  fiscal years 1996 and 1995,
respectively.  Forme converted the outstanding balance of
$450,000 to common stock during fiscal 1996.

      The Company owns 21,495 shares of Forme Capital's  Series
A, 10% Noncumulative  Preferred Stock, 50,000 shares of Series
B, 10%  Non-cumulative Preferred  Stock  and  466,571  shares
of  Series  C,  10%  Non-cumulative Preferred Stock.  The
preferred shares have no voting rights, pay dividends at  the
discretion  of Forme's board of directors, and have  priority
for payment  upon dissolution of Forme over Forme's common
stock.  The  Company received  dividends of $46,657 from Forme
Capital each of the fiscal  years 1998, 1997 and                    1996.
     During fiscal year 1996 a company affiliated with the
President of the Company  provided the Company with management
and other services valued  at $44,000  and   during  fiscal
year 1996, the President  and  the  Corporate Secretary  became
employees  of the Company.   Prior  to  this  they  were
employees of the affiliate and received no compensation from
the Company.
15.  COMMITMENTS AND CONTINGENCIES
     Leases
      The  Company  rents office space for its corporate
headquarters  from Forme  under  a  September 1993 agreement
expiring in  September  1998.  In March,  1998,  the Company
and Forme agreed to terminate the  lease.   Rent expense
incurred  with  Forme  for  fiscal  1998,  1997  and   1996
was approximately  $135,000, $80,000 and $80,00 respectively
each  year.   The lease included the following terms and
conditions:
                             F-21
                   CAMELOT CORPORATION AND SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
                               
15.  COMMITMENTS AND CONTINGENCIES - Continued

      1.   Forme has an option to buy the Company's furniture
and equipment located on the premises at the Company's book
value during the term of  the lease.

     2.   The Company granted a ten year option to Forme to
purchase 50,000 shares  of  restricted common stock at an
exercise price  of  $25.00  which includes piggy back rights.

      3.    Rental  payments automatically increase to 150%  of
prevailing market  rates  at  the time the President ceases to
be a  director  of  the Company.


      In  addition, the Company rents office and  warehouse
space  in  the Carrollton, Texas area. This lease is being
terminated in July , 1998.

      Total  rent  expense, all of which were minimum rentals,
for  fiscal 1998,  1997  and  1996 was approximately $300,000,
587,478,  and  $268,615, respectively.

Litigation

      During  the  ordinary course of business, the Company is
involved  in legal proceedings and regulatory inquiries which
management does not expect to have a material effect on the
financial position of the Company.

Liquidity and Capital Resources

      The  consolidated statement of operations presented in
the  financial statements reflects net losses for the years
ended April 30, 1998, 1997 and 1996.   However,  the  Company
has been able  to  improve  it's  financial position through
preferred and common stock offerings and has been able  to
raise  $1,666,275  in  1998, $3,410,500 in 1997  and
$22,330,214  in  1996
through  private  placements.  As indicated at Note  16,  the
Company  has discontinued its operating subsidiaries and sold
its Videotalk product line in exchange for shares in Wincroft,
Inc.

                             F-22
                   CAMELOT CORPORATION AND SUBSIDIARIES
                 NOTES TO FINANCIAL STATEMENTS
                               
15.  COMMITMENTS AND CONTINGENCIES - Continued

     Management believes that the Company's future success will
be achieved through  the development of VideoTalk by Wincroft,
Inc.  There  can  be  no assurance of future success.

16.  DISCONTINUED OPERATIONS

      During the year ended April 30, 1998, management
determined that  its operating  subsidiaries  should not
continue  in  business.            Third  Planet
Publishing,  Inc. sold all rights title and interests to its
software  and hardware  on  March 31, 1998.  The other
subsidiaries ceased  operating  by July 1998.

      The following information for the discontinued operations
is for  the year ended April 30, 1998.

    (Loss) on disposition of assets        $(189,825)
      Revenues                               162,500
    Cost of sales and inventory write down   507,443
   General and administrative expenses     1,559,769
    Net income(loss)                     (2,094,537)

       Earnings per share                           $(1.34)


On  January  31,  1995,  the  Company's video  marketing  and
distribution subsidiary Camelot Entertainment filed Chapter 7
bankruptcy with  the  U.S. Bankruptcy Court. Loss on disposals
for fiscal 1996 were $250,925.

     17.  INDUSTRY SEGMENT

      The Company and its subsidiaries operated in one industry
segment and are vertically integrated in retailing,
distribution, and publishing of CDROM software.

18.  FOURTH QUARTER ADJUSTMENTS (UNAUDITED)

During  the  first  three  quarters  of  1997,  the  Company
reported  its investment  in  Meteor Technology plc ("Meteor")
at fair  value  (SFAS  No. 115), therefore revenue for the
license agreements with Meteor and the loss on  the  market
value of Meteor stock was reflected in  the  statement  of
operations.   During the fourth quarter of 1997, the Company
reviewed  its accounting  treatment  of  its investment in
Meteor.   In  accordance  with Accounting  Principles  Bulletin
Number 18  the  investment  in  Meteor  is properly  accounted
for  using  the  equity  method  of  accounting.
The
aggregate  effect  of  this adjustment was an approximate
$1,263,000  loss recorded on its investment in Meteor.

The Company also reviewed its inventory and receivable
valuation allowances which             resulted  in  a
decrease in assets of  approximately  $229,000  and
$496,000 for inventory and $1,025,000 and $889,000 for
receivables for 1998 and 1997 respectively.






                                   F-25
<PAGE>

                   CAMELOT CORPORATION AND

              SUBSIDIARIES SCHEDULE II -

              VALUATION AND QUALIFYING ACCOUNTS

                 Years Ended April 30, 1998, 1997

                 and 1996

                 

                 

Description

Allowance deducted
from assets to which
it applies:

                                 Additions
     Accounts      Balance   Charged to   Charged
Balance at
     Receivables      at      Costs and     to
End of
     Year Ended   Beginning   Expenses     Other   Deductions
                      Period of          Accounts
                    Period

     April 30,       $19,947       $19,947        -
     1998                                                  (a)

     April 30,      $ 11,415  $    8,532         -   $       -
$   19,947
     1997

     April 30,        36,419      10,887         -   35,891(a)
11,415
     1996

     Notes
     Receivable
     Year Ended

     April 30,      $889,000  $1,025,216            $1,914,216
     1998

     April 30,      $      -  $  889,000   $     -  $        -
$ 889,000
     1997

     April 30,             -           -         -           -
     1996
-

     Inventories
     Year Ended

     April 30,      $494,744   $ 363,837               808,851
50,000
     1998

     April 30,      $198,000   $ 495,942   $     -   $ 199,198
$ 494,744
     1997

     April 30,             -     198,000         -           -
198,000
     1996

(a) Uncollected receivables written off, net of recoveries


                                  F-26