SECURITIES AND EXCHANGE COMMISSION
                      Washington, D. C. 20549

                             FORM 10-K

          Annual Report Pursuant to Section 13 or 15(d) of
                the Securities Exchange Act of 1934

For the fiscal year ended April 30, 1997          Commission File No.  0-8299

                         CAMELOT CORPORATION
        (Exact Name of Company as specified in its charter)

          Colorado                           84-0691531
     (State or other jurisdiction of         (I.R.S. Employer
      incorporation or organization)         Identification No.)

        Camelot Place, 17770 Preston Road, Dallas, Texas     75252
             (Address of principal executive office)          (Zip Code)

Company's telephone number, including area code:    (972) 733-3005

Securities registered pursuant to Section 12(g) of the Act:

                                      Name of each exchange on
      Title of each class               which registered

     $0.01 par Value Common Stock                 NASDAQ

Indicate by check mark whether the Company (1) has filed all reports required to
be  filed  by Section 13 or 15(d) of the Securities Exchange Act of 1934  during
the  preceding  12  months  (or for such shorter period  that  the  Company  was
required  to  file  such  reports), and (2) has  been  subject  to  such  filing
requirements for the past 90 days.
                        Yes  X       No ____

Indicate  by check mark if disclosure of delinquent filers pursuant to Item  405
of  Regulation  S-K is not contained herein, and will not be contained,  to  the
best  of  Company's  knowledge, in definitive proxy  or  information  statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.

Based  on  the price of $3.6875, at July 28,1997, the aggregate market value  of
the voting stock held by nonaffiliates of the Company was $4,754,463.

The number of shares outstanding of the Company's common stock, $0.01 par value,
was 1,472,672 at July 28, 1997.

                DOCUMENTS INCORPORATED BY REFERENCE

Form 8-K dated May 20, 1997 with amendments.



                                     PART 1


Item 1.   Business

      Camelot  Corporation ("Registrant" or "the Company") is a holding  company
with subsidiaries in technology and telecommunications.

      The  Company  was  incorporated in Colorado  on  September  5,  1975,  and
completed  a $500,000 public offering of its common stock in March,  1976.   The
company  has made several acquisitions and divestment's of businesses  unrelated
to  its  present activities (see Acquisition and Divestment History) and  during
the  years  ended  April  1994 and April 1995, undertook a  restructuring  which
involved  the  sale or closure of all subsidiaries operating in prior  financial
periods.

      The Company's activities are conducted through subsidiaries.  Third Planet
Publishing, Inc., (`Third Planet") (established in January 1995) is  a  research
and  development company developing leading edge technology in both hardware and
software   solutions  for  audio  and  video  conferencing  over  the  Internet.
mrcdrom.com, inc. ("mrcdrom.com"), (established  in March, 1997) is  a  Internet
catalog retailer of software.   Camelot Internet Access Services, Inc. ("CIAS"),
(established in June 1996) is a provider of Internet access services.  Alexander
Mark Investments (USA), Inc. ("AMI") (80% acquired in May 1997) is a U.S. public
holding company whose 57% owned subsidiary, Meteor Technology plc ("Meteor")  is
a  U.K.  public  company.   Meteor's  two  primary  subsidiaries  are  DigiPhone
International  Ltd  which is the worldwide distributor of all  the  products  of
Third  Planet,  and  Meteor  Payphones Ltd an operator  of  approximately  2,000
payphones

Third Planet Publishing

      Third  Planet  is  an  innovative technological research  and  development
company  focusing  on  hardware  and software  solutions  for  audio  and  video
communications over the Internet.  Third Planet is at the culmination  of  a  30
month development program for Internet video conferencing and telephony and will
make  its  new  products available for licensing to major  Personal Computer 
("PC") manufacturers in approximately September 1997.

      Third Planet released its first product, DigiPhone, in October 1995.   The
product  represented a telecommunications breakthrough by permitting  the  full-
duplexing  of  voice  over  the  Internet  making  real  time  worldwide   voice
communications  possible  for  PC  users at  the  cost  of  a  monthly  Internet
connection  fee.   The current version of the product, called  DigiPhone  Deluxe
includes  modern  telephone  features such as speed  dialing,  voice  messaging,
caller  ID,  call  record  and play back, conference  calling,  amongst  others.
Conversations are encrypted and completely private unlike the commonly used  IRC
connections or Internet chat rooms in competing software.

      In  April 1996, Third Planet commenced a development program for DigiPhone
2.0,  the  latest version of DigiPhone which included multi-protocol  frameworks
enabling  DigiPhone  to  communicate with  any other  standards  based  Internet
telephony software.  The frameworks are based on component technology that  will
allow  the  development  of  new functionality for the DigiPhone  communications
engine.   This  new approach will allow DigiPhone to evolve more  quickly  in  a
rapidly maturing  Internet telephony market.  DigiPhone 2.0 will be available in
approximately September 1997.

      In  May 1996, Third Planet announced a development program for an Internet
telephony  handset specifically designed to enable superior voice communications
over  the Internet.  Proficia is an audio handset which connects to a multimedia
PC,  eliminating  the need for a headset, microphone or speakers.   It  provides
quality  sound  for  Internet  telephony,  computer  telephony  and  multi-media
applications, and will be available for licensing in approximately September
1997.

      The  principle focus of Third Planet's research and development department
has  been on the development of VideoTalk, a video conferencing system  for  the
Internet.   Third  Planet has applied for a patent for  VideoTalk,  which  is  a
complete hardware and software system which, when connected to a multimedia  PC,
enables full duplex video conferencing over the Internet and over local and wide
area  networks.   Uniquely, VideoTalk will operate in the background  while  not
detracting  from the PC's ability to run other software programs simultaneously.
It  uses  a  PCI plug-and-play card that provides high quality audio  and  video
while  achieving  extremely low processor load.  VideoTalk does  not  require  a
sound  card or a video capture card, and allows communications over the Internet
with  only  a 28.8 kbps modem.  The VideoTalk unit includes a NTSC or PAL  color
video  camera, a special version of the Proficia telephony handset and both  the
VideoTalk   and  DigiPhone  2.0  software.  Discussions  with  PC  manufacturers
regarding  the  licensing of VideoTalk for inclusion with forthcoming  platforms
have commenced.

      VideoTalk is capable of video conferencing at 15 frames per second over  a
28.8  modem.  This is a major breakthrough, as competing technologies  currently
struggle  to  achieve  2  or 3 frames per second over  the  Internet.  VideoTalk
offloads  almost all of the audio and video processing onto its own  processors.
This frees the PC  for other tasks, such as application sharing, while ensuring
the video comes through at  a  frame  rate that software-only solutions simply
cannot  match.   

     VideoTalk   features   a  modular  framework,  simplifying   upgrades   and
expansions.   This  flexibility will allow third  party  developers  to  utilize
VideoTalk and its powerful processors as the engine for their own programs.

VideoTalk's technical features include:

 .    Multi-point conferencing
 .    High frame rate
 .    Low processor load
 .    Expandable system
 .    CIF, QCIF, and SQCIF formats
 .    Dual NTSC or PAL video input
 .    Echo cancellation
 .    Full duplex audio/video
 .    Outstanding speech quality
 .    H.323 compliant
 .    Open architecture
 .    Firmware upgradeable
 .    Scaleable hardware and software
 .    MIPS-based accelerated video processing
 .    Built-in frame grabber and audio amplifier

      VideoTalk  will  be  available for licensing  to  major  PC  manufacturers
commencing September 1997.

      In June 1997, a successful demonstration of all the three new products was
held  in  Atlanta  at  COMDEX/Spring 97'.  These products were  enthusiastically
received with VideoTalk being featured on COMDEX TV as a show highlight.

      Through a series of transactions in July 1996, November 1996 and May  1997
the  worldwide  marketing rights for all Third Planet products  are  exclusively
with  DigiPhone  International Ltd., a subsidiary of  Meteor  Technology  plc  a
public company affiliated with Registrant.

Meteor Technology plc

      Subsequent  to the financial year end, Registrant, through its acquisition
of  80%  of  AMI  obtained control of Meteor a U.K. listed public  company  (see
Acquisition and Divestment History).  Meteor's two operational subsidiaries, are
DigiPhone  International Ltd. and Meteor Payphones Ltd.  DigiPhone International
is the worldwide distributor for all products developed by Third Planet.  Meteor
Payphones  owns  and/or  operates approximately 2,000 payphones  in  the  United
Kingdom, which business it is intended to expand both by internal growth and  by
acquisitions.

mrcdrom.com, inc.

           In  April 1997, Registrant announced a new Internet shopping  company
called mrcdrom.com, a subsidiary, which will sell software titles over its World
Wide Web Site. It  also  announced  the  filing of a registration  statement  to
raise  up  to $12,000,000 through an initial public offering ("IPO") over the 
Internet, offering up to three million shares, at $4.00 per share. The Company
will be offering its shares  exclusively  over the Internet with no underwriter 
and  with  a  minimum subscription  of  $200  for 50 shares.  Following the 
offering  if  all  shares offered  are  sold the Company will have 9,000,000 
shares outstanding.   Camelot, who  will  retain  a  60%  shareholding sub-
sequent to the  IPO,  transferred  to mrcdrom.com  approximately  $760,000 of 
inventory, cash,  trademarks  and  other assets.  The mrcdrom.com Internet
catalogue is currently being test marketed via its World Wide Web site at 
http://www.mrcdrom.com.

      This  new business grew out of the experience and resources of Registrants
previous software retail chain called Mr. CD-ROM Stores, Inc., which was  closed
during  the  financial period.  The Company will offer a wide selection  of one-
stop  computer  software  shopping  through  a  secure  site  on  the  Internet.
Customers are offered a large selection of titles as well as competitive pricing
and  can run searches in various categories, check order status, and click on  a
button  to  add software to their virtual shopping baskets.  To execute   orders
customers  click  on  a button and are prompted to supply shipping  and  payment
details.

     
A  registration statement relating to these securities has been filed  with  the
Securities  and  Exchange  Commission but has not yet become  effective.   These
securities may not be sold nor may offers to buy be accepted prior to  the  time
the   registration  statement  becomes  effective.   This  document  shall   not
constitute  an  offer to sell or the solicitation of an offer to buy  nor  shall
there  be  any  sale  of  these securities in any State  in  which  such  offer,
solicitation  or  sale would be unlawful prior to registration or  qualification
under the securities laws of any such State.

Camelot Internet Access Services, Inc.

      An  Internet  services provider formed in January  1996  using  the  UUNet
backbone,  this subsidiary's principle activities are the provision  of  support
services  for  Registrant  and  the provision of Internet  access  to  users  of
DigiPhone  who  would otherwise be unable to access the Internet.   Due  to  the
intense competition experienced by the Internet access industry, Registrant  has
no plans to expand the activities of this company.

PCAMS

      In  February 1997, Registrant acquired from Meteor the U.S.A. and Canadian
rights  to  PCAMS software, a payphone contract and management system originally
developed  for  Meteor's payphone subsidiary.  This reflects  the  intention  of
Management   to   broaden  the  scope  of  Registrant's   involvement   in   the
telecommunication  industry.   Management  believes  that  the  passage  of  the
Telecommunications  Act  of  1996  followed  by  the  release  of  new  payphone
compensation rules by the Federal Communications Commission in response  to  the
Act  has  significantly  improved the outlook for this industry,  and  that  the
acquisition of PCAMS software enables Registrant to improve the capabilities  of
independent payphone providers.  Management will seek to utilize PCAMS  software
both  by  offering  such  software  to  independent  providers  and  by  seeking
acquisitions of payphone businesses.

Competition

      The technology and telecommunications industry is highly competitive.  The
Company's  competitors include other national and regional companies many  which
have  substantially greater financial and other resources than the Company which
may give them certain competitive advantages.  There are many companies entering
the  technological  and telecommunications markets with new  products  and  this
trend is expected to continue.  The ability of Registrant to effectively compete
in  the  future depends on a number of factors including its ability  to  create
and/or  acquire products that customers will accept and respond  to  and  comply
with  the  changing  nature  of  regulations  in  the  manner  which  they   are
interpreted.  Registrant's businesses may be effected by a variety  of  factors,
including  but not limited to general economic trends, additional  and  existing
competition,  marketing  programs, special or unusual events,  and  acquisitions
made by  the Company.

Trademarks and Trade Names

      "Mr.  CD-ROM", "DigiPhone", "VideoTalk", "Proficia", "People are Talking",
"Call  Anywhere.  Talk Forever.  Never Pay Long Distance" and "Kids  University"
are  registered  or  have  been  applied for in the  United  States  patent  and
trademark office and where appropriate with foreign regulatory bodies as service
marks  or trademarks of the Company.  The Company believes the strength  of  its
trademarks and service marks benefits its businesses and intends to continue  to
protect and promote its registered common law trademarks and service marks.

Acquisition and Divestment History

      On  September  16,  1988, the Company acquired Stock Transfer  Company  of
America,  Inc. ("STCA"), a transfer agent, for 6,666 newly issued common  shares
of  the  Company  (post  reverse split).  In connection with  this  transaction,
Daniel  Wettreich was appointed a Director, Chairman and Chief Executive Officer
and Jeanette Fitzgerald was appointed a Director.   On April 11, 1994, following
a  decision  by the Directors of the Company to discontinue financial  services,
activities STCA was sold to a company affiliated with Mr. Wettreich  for  book
value (See Item 13.  Certain Relationships and Related Transactions).

       On  March  2,  1990,  the  Company's  subsidiary,  Beecher  Energy,  Ltd.
("Beecher")  was  listed on the Vancouver Stock Exchange in  an  initial  public
offering.  The Company sold its 69% shareholdings in Beecher on July 6, 1994 for
C$400,000.

      In January 1991, the Company acquired for cash an 80% majority interest in
Forme  Capital,  Inc. ("Forme") a publicly traded real estate company  from  the
wife  of Mr. Wettreich.  In September 1993, the Company sold to Forme two office
properties and then sold all its investment in Forme for cash to Mrs. Wettreich.
These  transactions  were approved by the shareholders of  the  Company  at  the
Annual  Meeting  held  on  February  15,  1994.  (See  also  Item  13.   Certain
Relationships and Related Transactions).

     Other acquisitions were as follows:

     Date                   Name            Business            Cost

March 1991     Vesta Land Title Company  Titles             $120,000
July 1991      Business Investigations       Investigations        312,231
July 1992      McKee-Blanchard               Appraisals              32,203
September 1992 First Appraisal Group         Appraisals              15,000
June 1994      Maxmedia Distributing         Software Distribution  168,500

      These  companies ceased doing business in July 1994, July  1994,  November
1993, November 1993, and May 1995, respectively.

      In  July, 1993, Registrant acquired approximately 40% of the issued  share
capital of Goldstar Video Corporation ("GVC"), a video marketing company  for  a
net  price  of  $92,432.  Registrant also made a $150,000 secured loan  to  GVC.
Further,  Goldstar  Entertainment,  Inc.  ("GEI")  a  subsidiary  of  Registrant
acquired  certain  licenses and other assets from GVC for $375,000.   Thereafter
Registrant's  subsidiary  Camelot Entertainment, Inc. commenced  business  as  a
video  marketing  company.  On October 20, 1993, GVC filed for  protection  from
creditors under Chapter 11 of the Bankruptcy Code which was converted to Chapter
7  on  February 4, 1994.  Registrant was not a controlling shareholder  of  GVC.
The  Company's subsidiary Camelot Entertainment, Inc. filed under Chapter  7  of
the US Bankruptcy laws in January, 1995.

      In  November  1995,  Registrant appointed Firecrest  Group  plc  a  public
company,  as  exclusive  distributor for DigiPhone in  the  United  Kingdom  and
Ireland in consideration for $1,950,575 payable by shares equal to approximately
10%  of  Firecrest.  In March 1996 all relations with Firecrest were  terminated
and  Registrant  sold  all  its  shares in  Firecrest  in  market  transactions.
Subsequently,  Firecrest sold its DigiPhone rights to  Meteor.   In  July  1996,
Registrant sold the European rights to distribute DigiPhone to DigiPhone  Europe
Ltd  which  became a subsidiary of Meteor.  The consideration was 5,000,000 
British pounds sterling of loan  stock  which was subsequently converted into
Meteor shares. In November 1996 Registrant sold the international DigiPhone
rights to Meteor for 1,000,000 British pounds Sterling of loan stock which 
subsequently was converted into Meteor shares.In  May 1997, DigiPhone Inter-
national a Meteor subsidiary became the  exclusive marketing company for all
Third Planet products on a worldwide basis.

      In  May 1997, Registrant acquired approximately 80% of AMI whose principle
asset  is  approximately 57% of Meteor.  The consideration (post reverse  split)
payable  to  the  seller,  Adina, Inc. ("Adina") was 892,014  Preferred  Shares,
Series  J  of  Registrant and 453,080 Preferred Shares,  Series  J  in  deferred
consideration.   Following the transaction Adina has 49% of  the  voting  rights
attributable to the currently issued and outstanding common and preferred shares
of  Registrant.  Mr. Wettreich is a director of Adina and did not participate in
any directors' votes in relation to this transaction.

Discontinued Activities  -    See Item 7.    Management Discussion and  Analysis
of  Financial Conditions  and  Results  of Operations

Employees

      As  of  July 1, 1997, the Company employs 39 people on a full time  basis.
The Company believes that it has good employee relations.

Item 2.   Properties

Real Estate

      Company leases a 10,000 square feet office building in Dallas, Texas which
it  occupies  as its corporate headquarters from a company affiliated  with  the
President.  Company also leases 19,950 square feet office and warehouse building
in  Dallas,  Texas  which it occupies as a distribution center for  mrcdrom.com,
Camelot  Distributing  and as programming and publishing  facilities  for  Third
Planet Publishing.   The Company considers all office and warehouse space leased
adequate for its needs.  Mr. CD-ROM Stores currently leases four retail units in
Dallas,  Texas  which they are in the process of negotiating with  landlords  in
order to terminate the leases.

Item 3.   Legal Proceedings

     No material legal proceedings to which the Company is a party is subject or
pending and no such proceedings are known by the Company to be contemplated.  In
the normal course of business, the Company has been sued as detailed below.  The
Company   believes  there  is  no  validity  to  these  suits,  and  has  denied
plaintiff's allegations.

      The  Company  has been sued by a creditor of a previous  subsidiary.   The
Plaintiffs  alleges that the Company is the alter ego of the previous subsidiary
and is therefore liable for its debts.  The Company believes the allegations are
groundless and intends to vigorously defend itself in litigation.

       The Company has been sued for breach of lease of a retail unit previously
occupied by Mr. CD-ROM Stores, Inc.  The Company intends to show failure on  the
part of the landlord to relet the space.

     There are no proceedings to which any director, officer or affiliate of the
Company, or any owner of record (or beneficiary) of more than 5% of any class of
voting securities of the Company is a party adverse to the Company.

Item 4.   Submission of Matters to a Vote of Security Holders

      A  special shareholder's meeting was held on July 14, 1997 approving a one
for  forty  reverse stock split of all outstanding common shares and outstanding
preferred shares, Series J.

Item 5.   Market for Company's Common Equity and Related Stockholder Matters

      The Company's common stock trades on the NASDAQ Small-Cap Market under the
symbol  CAMLD (such symbol to change to CAML on August 15, 1997).  The following
table  sets forth the quarterly high and low prices of the common stock for  the
period  from May 1, 1995 through April 30, 1997 (post reverse split).  Real-time
price  information  is provided from quotations take from monthly  reporting  by
NASDAQ.  They reflect inter-dealer prices, without retail mark-up, mark-down  or
commission, and may not necessarily represent actual transactions.

<TABLE>
     <S>       <C>                 <C>       <C>
                                    Real Time

                                   High      Low


     1996

     First     July  31, 1995      $ 97.50        $60.00
     Second    October 31, 1995     281.25         77.50
     Third     January 31, 1996     196.25         92.50
     Fourth    April 30, 1996       127.50         68.75

     1997

     First     July 31, 1996       102.50         37.50
     Second    October 31, 1996    60             43.75
     Third     January 31, 1997    35             23.75
     Fourth    April 30, 1997      15              3.75
</TABLE>

   As  of  July 18, 1997, the Company had 9,664 shareholders of which there were
1,191  shareholders  on record of Company's common stock  and  8,473  additional
beneficial owners.  On July 28, 1997 the Company's shareholders approved  a  one
for  forty  reverse  stock  split on all the outstanding  common  and  preferred
shares,  Series  J resulting in 1,472,672 common shares and 1,443,218  preferred
shares, Series J outstanding.

Item 6.   Selected Financial Data

      A  comparison  of  various  financial data  pertaining  to  the  Company's
operations over the past five fiscal years is as follows:
<TABLE>

<S>         <C>           <C>          <C>          <C>          <C>
                1997         1996         1995         1994         1993
                                                                 
Net sales     $1,887,617   $3,002,049   $1,184,469          $ -         $ -
Income                                                                     
(loss)      (12,996,369)  (4,314,788)  (2,335,977)  (1,567,312)   (256,320)
from  con-
tinuing
operations
Income                                                                     
(loss)                 -    (250,925)  (1,182,927)    (402,981)   (435,772)
from dis-
continued
operations
Income                                                                     
(loss) per       (20.45)      (12.54)       (9.17)       (8.30)      (3.79)
share from
continuing
operations
Total          6,772,076   16,701,863    2,098,974    3,309,132   3,337,494
assets
Long-term              -            -            -            -     633,528
debt
                                                                           
                                                                           
                                                                           
                                                                           
</TABLE>

      Company's  software subsidiaries commenced operations during  fiscal  1995
(See Item 1).

     On January 30, 1995, Company's subsidiary Camelot Entertainment filed under
Chapter 7 of the US Bankruptcy Code.

      On April 11, 1994, Company disposed of its subsidiary STCA, and on July 8,
1994  discontinued  Vesta Land Title Company and Business Investigations its
remaining financial  service  subsidiaries
(See Item 1.  Business).

      On  July  6, 1994, Company disposed of its 69% interest in Beecher Energy,
Ltd.,  a company trading on the Vancouver Stock Exchange representing its energy
interests (See Item 1.  Business).

      On  September  11, 1993, the Company disposed of its investment  in  Forme
Capital, a real estate holding company (See Item 1).

Item  7.   Management Discussion and Analysis of Financial Condition and Results
of Operations

      Certain  information  within this Item 7 and  throughout  this  Form  10-K
contain  forward  looking statements.  These statements are subject  to  certain
risks  and  uncertainties that could cause actual results to  differ  materially
from  those  set  forth including but not limited to Camelot's  dependence  upon
outside  suppliers, upon the continued ability to create and/or acquire products
that  customers  will  accept;  the  impact  of  competition  and  the  changing
competitors; the changing nature of regulations and the manner in which they are
interpreted;  and  pricing pressures in addition to normal  economic  and  world
factors  beyond  the control of the Company;  the Company's  ability  to  create
competitive  products; changes in technology and the ability to  obtain  patents
and trademarks.

1997

     Although  the  Company's historical financial results for  the  year  ended
April 30, 1997 were not good, Management believes that this is very typical  for
a  company primarily involved in research and development.  Management  believes
that Registrant's principal subsidiary Third Planet is now at the culmination of
a  30  month  software  and  hardware development  program  for  Internet  video
conferencing and telephony which will yield positive results for the Company  in
the future.
     
     The  Company's revenue for the year was $1,887,617 compared with $3,002,049
in  1996.  Net loss for the period was $12,996,369 compared with $4,565,713  the
previous year.  These results are due to a combination of limited revenues  from
DigiPhone, the closure of the retail software stores and continuing research and
development costs which were largely expensed.  Further, other expenses of 
$4,675,189 relating to losses on disposition of assets, investments in affil-
iate, marketable securities and a note receivable allowance impacted the 
results.
     
     The consolidated balance sheets for the period show stockholders' equity of
$6,078,509  compared with $15,680,168 for the previous year.  Total assets  were
$6,772,076  compared  with $16,701,863 in 1996.  The decrease  in  stockholders'
equity and total assets was due to losses.
     
     During  the  year,  substantial  financial and  managerial  resources  were
expended   in  the  continuing  research  and  development  of  Internet   video
conferencing  and  Internet telephony, and Management believes that  significant
progress  was  made  in this regard.  Through its affiliated company,  DigiPhone
International, Registrant will make available for licensing Third Planet's three
new products in approximately September 1997, which products are to be offered
to the major PC manufacturers.

During the financial year, Registrant's activities resulted in the following.

 .    Completion and shipping through retail distribution channels of DigiPhone
       Deluxe
 .    A development program for multi-protocol framework for DigiPhone 2.0
 .    The filing of a worldwide patent for VideoTalk
 .    A thirty-day version of DigiPhone for downloading over the Internet
 .    The launch of Camelot Internet Access Services
 .    An agreement with Lucent Technologies to license Lucent's voice codec for
      future versions of DigiPhone
 .    Completed DigiPhone for Mac
 .    Completed arrangements for worldwide distribution of Third Planet products
     with DigiPhone International, an affiliate of the Company
 .    Listed Registrant's securities on the Frankfurt Stock Exchange
 .    Acquired PCAMS Software
 .    Filed an initial registration statement for mrcdrom.com, inc.
 .    Acquired a controlling interest in AMI
 .    Demonstrated its new technology at COMDEX/Spring in Atlanta

     Registrants subsidiary Mr. CD-ROM Stores, Inc. closed its five retail 
locations during the period and transferred the majority of its assets to a 
fellow subsidiary mrcdrom.com (See Item 1. Business).

     Management believes its future profitability and revenues will result  from
licensing  its  VideoTalk,  DigiPhone  2.0,  and  Proficia  technology   to   PC
manufacturers  and  (subject to a successful conclusion of  the  initial  public
offering of mrcdrom.com), from the sale of software and ancillary products  over
the  Internet.  Management also intends to expand its interests in the  payphone
industry  both  through  its affiliate Meteor Payphones and  through  developing
and/or acquiring payphone interests in the United States and Canada.

1996

      The   Company made substantial progress during the year ending  April  30,
1996.   The  company's  revenue  for  the  year  was  $3,002,049  compared  with
$1,184,469 in 1995, an increase of 153%.  Net loss for the period was $4,565,713
compared with a loss for the previous year of $3,518,904.  These results are due
to  a combination of revenue from DigiPhone, license fees received from European
distribution rights for DigiPhone, revenue from the five newly opened Mr. CD-ROM
Stores,  and  increased  general  and  administrative  costs  related   to   the
development and marketing of DigiPhone.

     The consolidated balance sheets for the period show stockholders' equity of
$15,680,168 compared with ($87,049) for the financial year ended April 30, 1995.
Total  assets  were  $16,701,863 compared with $2,098,874 in  April  1995.   The
substantial  increase in stockholders' equity and total assets was  due  to  the
completion of private placements.
                                        
      During  the  April 1996 period, the Company's subsidiary  Third  Planet
completed  shipments of its preliminary orders for the Windows  3.1  version  of
DigiPhone.   This software achieved widespread retail distribution, and  by  the
end  of  the  third quarter the first production run had sold  out.   Subsequent
retail  reorders  were  limited in anticipation of the  Windows  95  version  of
DigiPhone  which  commenced shipment in May 1996 along  with  DigiPhone  Deluxe.
DigiPhone  Deluxe  has enhanced telephone features including conference  calling
capability, voice mail, speed dialing, voice sound effects, conversion recording
and  playback,  and macro command capabilities.  It comes with a full  suite  of
Internet  tools  including an  e-mail program, a newsreader, an FTP  program, 
and a telnet program. In addition, a free Windows 95 upgrade for the existing
DigiPhone software is available. Both DigiPhone and DigiPhone  Deluxe have two 
licenses in each retail box.  Effectively, this provides  two Windows  95
compatible licenses for DigiPhone or DigiPhone Deluxe for the  price
of   one,   and  enables  consumers  to  immediately  start  Internet  telephone
conversations  with  a family member or a friend without any  extra  cost. 

     During the April 1996 period, the Company announced the acquisition of e-
Phone,  formerly  known  as  NetPhone, the only  Macintosh  compatible  computer
software  that enables voice communication over the Internet. 
The purchase price was $593,000 payable $350,000 in  Camelot
restricted  common shares valued at $207.50 per share and the balance  in  cash.
In  addition, New Paradigm will also receive for a five year period $1 per  unit
and  10%  of  OEM revenue derived from the software.  The technology of  e-Phone
was  incorporated  by Third Planet into a Macintosh compatible  version  of
DigiPhone  called "DigiPhone For Mac".  The cost of acquisition was written off 
the 1997 financial period.

      The  appointment  of  Firecrest Group PLC  as  exclusive  distributor  for
DigiPhone  in  the United Kingdom and Ireland, occurred during the period  under
review.   The  consideration for the granting of the UK  and  Ireland  exclusive
rights  was  $1,950,575 payable by issuance by Firecrest of  1,856,453  ordinary
shares  equal to approximately 10% of the increased share capital of  Firecrest.
Firecrest is a media and marketing company in the United Kingdom.  

      The rights for Scandinavia were conditionally purchased in January 1996 by
Telepartner  Holdings  A/S, a Copenhagen, Denmark based company,  which  is  the
leading  telephone database services company in Scandinavia.  The  consideration
for the exclusive distribution rights was $1,000,000 payable by the issuance  to
Camelot  of  shares  in  Telepartner equal to  2.7%  of  the  share  capital  of
Telepartner.   Due  to the non-receipt of consideration, the Company  terminated
the agreement in May 1996.

      In  July,  1996,  after the financial year end, the Company  concluded  an
agreement  with  DigiPhone  Europe, Ltd., whereby  it appointed  DigiPhone
Europe,  Ltd.  as  exclusive distributor for DigiPhone and DigiPhone  Deluxe  in
Europe,  excluding  the United Kingdom and Ireland.  The consideration  for  the
rights was 5,000,000 pounds Sterling of 6% loan stock (approximately 
$7,500,000).  DigiPhone Europe, Ltd.  is  a London, England based European soft-
ware marketing company merged with Telecom Credit Europe,  PLC  ("TCE"),  a  
public company  listed  on  the  Alternative Investment  Market  of  the  
London  Stock Exchange.   Following  the merger, Camelot owns approximately 
16% of TCE.  The majority stockholder  of TCE, Danny Wettreich, is also 
Chairman and Chief Executive Officer of Camelot.   Mr. Wettreich did not part-
icipate in any Directors' vote in  relation to  this  transaction.

      During the period the Company opened five Mr. CD-ROM Stores in the Dallas,
Texas  area.   The retail stores range in size from 1,000 square feet  to  3,000
square feet, and specialize in CD-ROM software with up to 2,000 titles in stock.
These  Mr. CD-ROM corporate stores were intended to be the first of a previously
announced target of 100 corporate and franchise stores to be opened by Christmas
1996.   However, results from the stores led Management to the  conclusion  that
the retail concept was not viable and the stores were closed in 1997.

     On  January  26,  1996, the Company announced that  it  has  concluded  an
agreement  with UUNET . Technologies, Inc. whereby it will use UUNET's  Internet
backbone  for  the  Company's newly formed subsidiary, Camelot  Internet  Access
Services,  Inc.  ("Camelot Internet").  The use of UUNET's  exclusive  alternate
Internet  backbone  facilities enables Camelot Internet to  instantly  establish
itself  as  a  nationwide  quality Internet service provider.  Camelot 
Internet  was  officially launched in  June  1996  at  which  time  its
nationwide services commenced. Camelot Internet is offered as part of 
Camelot's DigiPhone  Deluxe  software package.

     At the world's first Internet Telephony conference, held in London, England
on April 18-19 and called "Dialing The Net", Danny Wettreich, Chairman and Chief
Executive  Officer of Camelot, disclosed a development program for the DigiPhone
Multi-Protocol   Frameworks.   These  frameworks  will   enable   DigiPhone   to
communicate  with  any other standards-based Internet Telephony  software.   

     A 30 day free trial of DigiPhone Version 1.03 software is available through
the  Company's  web  site  on the Internet.  To access this  free  offer,  users
download  the  software  from the Company's web page,  http://www.digiphone.com.
The  only  system requirement for potential users are a multimedia PC,  Internet
access  and  web  browser software.  At the end of the 30 day trial,  users  can
purchase  a full version of DigiPhone or DigiPhone Deluxe software by calling  a
toll-free  number.   Users will also be provided with a list of  retailers  that
carry  DigiPhone  Deluxe  software.  To gain additional exposure  for  DigiPhone
software,  Camelot will, in the future, offer this 30 day trial version  bundled
with  various third party hardware products and through Internet access provider
services.

      Subsequent to the period under review, the Company announced that  it  has
applied for a patent for VideoTalk TM, a video and audio communications system
for the  Internet.  VideoTalk is a complete hardware and software system which,
when connected  to  a multimedia PC, enables full duplex video and audio
conferencing over  the Internet.   It  will provide  significant  advantages 
to users as  VideoTalk   does  not  require  a soundcard  or  a video capture
card. VideoTalk will come with a new version of  DigiPhone 2.0  which will 
include the recently announced Multi-Protocol Framework allowing voice  
communication with other Internet telephony software.  VideoTalk's features 
are designed to incorporate new leading edge  audio and video compression
technology to enable connections over devices such as 28.8kbps  modems. Video-
Talk is designed with an expansion peripheral interface that  enables
attachments to be added to the VideoTalk unit. Third  Planet will provide API
specifications  so that other developers can take advantage of the features
and processing power of VideoTalk  in  their  applications.

      The  Company  also  announced  the Proficia TM, an Internet  telephony
handset  which  is specifically designed to enable superior voice communica-
tions over the Internet. The  handset  attaches  to the side of a computer
monitor  and  functions  in  a similar way to a telephone handset, thus 
eliminating the necessity for a headset or  microphone and speakers when
Internet voice communication software is  used.

    Management expects its principal revenue and profitability will  emanate 
from DigiPhone derivative software products and from license  fees,  and 
intends  to  concentrate  the  majority  of  its management  and financial 
resources on the development and successful  marketing of  Internet  related
products produced by its subsidiary Third  Planet.

1995

     During the year ended April 1995, Company completed its restructuring which
involved  the  sale  or  closure  of  all  previously  owned  subsidiaries   and
established  three  new operating subsidiaries, namely Third Planet  Publishing,
Inc.,  (established in January, 1995), Mr. CD-ROM Stores, Inc.  (established  in
December,  1994)  and Camelot Distributing, Inc. (established  in  April  1995).
Camelot  Distributing  acquired  the inventory and  customer  list  of  Maxmedia
Distributing  which  was acquired by Company in July, 1994 and  has  now  ceased
trading.   Due  to  the  fact  that trading operations  for  these  subsidiaries
commenced various times during the financial year, and to the fact that no prior
history  exists for the ongoing operations of Company, Company is of the  belief
that  the financial results for the year ended April 1995, and a comparison with
prior  period  financial statements is not indicative of the future  results  of
Company.

      The  results of operations of the discontinued operations and  the  assets
sold  or  to  be sold are presented in the financial statements as  discontinued
operations.   Prior  year  statements  of  operations  have  been  restated  for
comparative  purposes  with  the  result that  no  sales  or  related  financial
information  is  shown  due  to  the fact that  the  Company's  CD-ROM  software
subsidiaries  commenced operations during the fiscal year and did  not  generate
any revenues during previous fiscal years.

      Company's  continuing operations had sales of $1,184,469  in  fiscal  1995
compared  with  $-0- for 1994. Company had a loss from operations of  $2,348,155
compared with a loss from operations in fiscal 1994 of $1,138,387.  Net loss for
fiscal  1995 was $3,518,904 which includes loss from discontinued operations  of
$1,182,927  which compares with a loss from discontinued operations  for  fiscal
1994 of $402,981.

      The primary reasons for the loss from continuing operations was due to the
start up costs relating to the commencement of CD-ROM software operations in its
newly  formed  subsidiaries,  and the decision to  discontinue  Company's  other
businesses.    In  addition  to  start up costs  for  its  new  subsidiary,  its
subsidiary  Maxmedia which was located in Orlando was closed,  and  the  Company
incurred  relocation costs of personnel, inventory, fixtures  and  equipment  to
Dallas  which  is  a non-recurring one time costs.  Mr. CD-ROM  Stores  incurred
costs outside the normal course of business due to the testing and retesting  of
various  retail  concept  in its Orlando retail unit in  order  to  establish  a
permanent  long  term Mr. CD-ROM retail trading format.  Further,  Third  Planet
Publishing  incurred  programming  and data processing  costs  relating  to  the
creation  of  the CD-ROM interactive catalog and in relation to DigiPhone  which
management has decided to expense.

      The  consolidated  balance sheets for 1995 shows stockholders'  equity  of
($87,049)  compared  with  $1,408,498  for  fiscal  1994.   Total  assets   were
$2,098,874  compared with $3,309,132.  The decrease in stockholder's  equity  is
due  to a combination of the loss from operations and the loss from discontinued
operations.   Subsequent to the year end substantial increases  in  stockholders
equity  occurred  due to private placements of restricted common  and  preferred
stock  and the conversion to common stock of debt owing to an affiliate  of  the
President  of  Company,  all  of which resulted in  an  increase  in  equity  of
$1,875,000 during the three month period ending July 1995.

     Company began its CD-ROM software operations by the acquisition of Maxmedia
Distributing, a Florida based distributor of CD-ROM software in July 1994.   The
customer base of Maxmedia is now being serviced by Camelot Distributing,  a  CD-
ROM distributor supplying independent retailers from distribution facilities  in
Dallas,  Texas.

      Mr. CD-ROM Stores was established in December, 1994 with the opening of  a
retail concept store in Orlando, Florida.  This store, which was on a six  month
lease,  provided  an  opportunity to refine Mr. CD-ROM's retail  concept  during
which  time retail franchise documentation and approvals were obtained from  the
majority  of states in the USA.  A company owned store was opened in  Dallas  in
July,  1995 and an additional four retail units opened  by  December 1995 in 
the Dallas area. 

      Third  Planet Publishing commenced operations in January 1995 and  shortly
thereafter acquired the worldwide distribution rights to DigiPhone, the  world's
first  full duplex Internet phone system.  Third Planet expanded the  number  of
software  programmers  developing  the DigiPhone  technology  and  arranged  for
quality  retail  distribution as well as establishing marketing and  advertising
plans  for launching DigiPhone.

      Subsequent  to  the  period  ended April 1995, the Company  completed  a
private placement of restricted common and preferred shares raising 
$1,200,000  for  the Company.   The  investors  are  an  investment fund  
managed by  Suisse  Finance Corporation and have agreed not to dispose of 
their common shares for a  minimum of  twelve months.  The preferred shares
can convert into common shares  over a nine month period in equal monthly 
installments.  

Discontinued Activities

     During the year Company's directors determined to discontinue its remaining
non   CD-ROM   software   activity  and  accordingly  its   subsidiary   Camelot
Entertainment,  Inc., a video distribution company filed Chapter  7  liquidation
under  the  US  Bankruptcy  laws  in January 1995.   Company's  only  continuing
material liability in relation to Camelot Entertainment is a corporate guarantee
in the original amount of $200,000 to a creditor of Camelot Entertainment.  Such
corporate   guarantee  has  been  fully  allowed  for  in  Company's   financial
statements.  (See  Item 3). Revenues  of  Camelot Entertainment  which  are  
not shown in the financial  statements  as  they  are discontinued  oper-
ations were $694,666 for fiscal 1995 compared with  $2,597,366 for  the  pre-
vious  year.   Loss from operations for fiscal  1995  was  $406,057
compared with $1,563,174.

      As  reported  in the 1994 financial statements, Company's controlling  69%
interest in Beecher Energy, Ltd. was sold on May 31, 1994.  The transaction  was
closed  in  late July 1994.  Also as disclosed in the 1994 financial statements,
Company's   subsidiary  Business  Investigations  which  provided  investigation
services  to financial institutions and Vesta Land Title Company which  provided
title insurance services both discontinued operations on July 8, 1994.


Liquidity and Capital Resources


1997

     Net cash used by operating activities for 1997 was $5,555,018 compared with
$6,740,073  in  1996.   Net  cash used by investing  activities in 1997 was
$4,587,734 compared with net cash used by investing activities of $1,889,146 in 
1996.  This was  primarily due to the net loss of $12,996,369 in 1997 compared 
with $4,565,713 in the previous year. Net cash provided by  financing
activities was $3,302,152 compared with $18,350,289 the previous year.  Sales of
common and preferred stock were $3,410,500 compared with $22,330,214 in 1996.

     Registrant's  requirement  for  additional  financial  resources  primarily
results  from  the continuing research and development costs of  its  subsidiary
Third  Planet.   Registrant believes that its current development  program  will
shortly be concluded, but believes that continued research and development  will
be  required  to  maintain a technological lead which management  believes  that
Third  Planet currently has.  Accordingly, management is aware of the  need  for
additional  cash  resources to be obtained for the continuance of  research  and
development  and anticipates that such financial resources will  primarily  come
from   the  private  placement  of  Registrants'  common  and  preferred  stock.
Management believes that license fees received from Third Planet's products will
generate revenues and cash flow towards the end of the current financial period.
The  activities  of Registrant's subsidiary, mrcdrom.com are  dependent  on  its
initial  public offering (See Item 1.  Business).  Registrant has no  plans  for
significant  capital  expenditures during the next  twelve  months.   Management
believes that cash provided by financing activities and licensing fees  as  well
as  revenue  from sale of software over the Internet together with  the  present
level  of cash resources available to the Registrant will be sufficient for  its
needs  over the next twelve months.  Management believes that should the Company
require  additional cash resources it can incur borrowing as Registrant  has  no
long-term  corporate  debt.  There are no known trends demands,  commitments  or
events  that  would  result in or that is reasonably likely  to  result  in  the
Company's  equity  increasing or decreasing in a material  way  other  than  the
potential use of cash resources for investment in the Company's subsidiaries  in
the normal course of business or additional fund raising.

1996

     Net cash used by operating activities for 1996 was $6,740,073 compared with
$2,207,683  in  1995.   Net  cash used by investing  activities  was  $1,889,146
compared with net cash received of $28,482 in 1995.  This was primarily  due  to
product  development  and software costs of $608,800 compared  with  $40,000  in
1995,  to  the purchase of minority interests of $264,044 ($0 in 1995),  to  the
issuance  of  a note receivable in the amount of $312,400 ($0 in  1995)  and  to
purchases of property and equipment of $1,087,658 ($195,589 in 1995).

      Net  cash  provided by financing activities was $18,350,289 compared  with
$2,290,941  the previous year.  Sales of common stock and preferred  stock  were
$22,330,214  compared with $1,623,847 in 1995.  These transactions substantially
improved  the liquidity of the Company and helped raise stockholders' equity  by
$15,767,262 in 1996.

      The Company's plans for capital expenditures relate principally to capital
costs  likely to be incurred in opening of additional retail units.  Manage-
ment does not anticipate any liquidity problems and believes that the antici-
pated level of revenue  generated  by  the Company  together  with  the pre-
sent level of cash resources  available  to  the Company  will be sufficient
for its needs.  Management believes that should  the Company  require  addi-
tional  cash  resources,  it  can  raise  additional  cash resources  from 
the  sale  of common and preferred stock  and/or  by  incurring borrowing.  
Management  is aware that the Company has no  long  term  corporate
debt.   Management believes that it is well positioned to make arrangements  for
additional  debt  should  the need arise.  There are no known  trends,  demands,
commitments,  or  events that would result in or that is  reasonably  likely  to
result  in  the Company's liquidity increasing or decreasing in a  material  way
other  than the potential use of cash resources for investment in the  Company's
subsidiaries and the normal course of business.

      Management  continued  to  demonstrate  its  ability  to  attract  private
investment  during the nine months ended January 31, 1996.  The  Company  raised
$22,330,214 in private placements of restricted common and convertible preferred
stock.   The  preferred stock yields range from 9% to 12% and can  be  converted
into  common shares of the Company in limited amounts during agreed time  frames
subsequent to issuance and in unlimited amounts thereafter.  The conversion rate
is  equal  to  an  agreed upon discount on the prevailing market  price  of  the
Company shares at the time of the conversion.

1995

      Net cash used by operating activities was $2,207,683 in 1995 compared with
$2,145,545  in  1994.    This was primarily due to the net  loss  of  $3,518,904
compared  to $1,970,293 in 1994.  The most significant adjustments to  reconcile
net  loss to net cash from operating activities were a write off of discontinued
subsidiaries of $560,577.  Net cash provided by investing activities of  $28,482
compares with cash used of $160,239 for the previous year.

      Net cash provided by financing activities was $2,290,941 compared with net
cash provided during the previous year of $1,067,171.  Sales of common stock  of
$1,623,847 compares with $517,322 in fiscal 1994.

     Subsequent to the period under review, Company completed $1,425,000 Private
Placements and converted $450,000 debt owing to an affiliate of the President of
Company  to common stock.  These transaction substantially improve the liquidity
of  Company, and raised stockholder's equity by $1,875,000 in the quarter  ended
July 31, 1995.

 Management does  not anticipate  any  liquidity  problems and believes that the
anticipated  level  of revenue generated by Company together  with  the  present
level  of cash resources available to Company will be sufficient for its  needs.
Management  believes  however that should sales of  DigiPhone  and  or  revenues
generated  from  retail units be less than anticipated that it  will  experience
liquidity  problems. Management believes that should Company require  additional
cash  resources, it can raise such additional cash resources from  the  sale  of
common  stock  and/or  by incurring borrowings from its  directors  or  entities
affiliated with directors and from unrelated financial institutions.  Management
is  aware  that other than indebtedness owing to an entity affiliated  with  its
President, Company has no corporate debt.  Management believes that it  is  well
positioned  to  make  arrangements for additional debt should  the  need  arise.
There  are no known trends, demands, commitments or events that would result  in
or that are reasonably likely to result in the Company's liquidity increasing or
decreasing  in  any material way other than the potential use of cash  resources
for investment in Company's subsidiaries in the normal course of business.

Item 8.        Financial Statement and Supplementary Data

Index to Consolidated Financial Statements        Page

Report of Independent Auditors - 1997             F-1

Consolidated Financial Statements
     Balance Sheets - April 30, 1997 and 1996     F-2 and
                                                  F-3
     Statements of Operations for the years
         ended April 30, 1997, 1996 and 1995      F-4

     Statements of Stockholders' Equity for the
         years ended April 30, 1997, 1996 and 1995  F-5 through
                                                    F-7
     Statements of Cash Flows for the years ended
         April 30, 1997, 1996 and 1995            F-8 and
                                                  F-9
                                                   
     Notes to Consolidated Financial Statements   F-10 through
                                                  F-30

Consolidated Schedule                             F-31

      The information itemized above are included in Part IV, Item 14 as Exhibit
(a) (1) and begins at F-1 following page 39.

      Also  included is the unaudited information regarding proven oil  and  gas
reserves.

Item 9.        Disagreements on Accounting and Financial Disclosure

      Lane  Gorman Trubitt, L.L.P., were the auditors for the fiscal year  ended
April  30,  1997 and have performed the audit for every past fiscal  year  since
1994.  There were no disagreements between the Company and the auditors 
regarding a policy or disclosure.

                                    PART III

Item 10. Directors and Executive Officers of the Company

  The following persons serve as directors and/or officers of the Company as  of
July 2, 1996:
<TABLE>
<S>              <C>   <C>               <C>               <C>
Name             Age   Position          Period Served     Term Expires

Daniel Wettreich 45    Chairman and      September 16,     Next Annual
                       Chief Executive   1988               Meeting
                       Officer,President,
                       Director


Jeanette P.
  Fitzgerald     36    Vice President,   September 16,     Next Annual
                       General Counsel,  1988              Meeting
                       Secretary,
                       Director

Allan S. Wolfe   65    Director          May 24, 1993      Next Annual
                                                           Meeting

Bruce Baldwin    64    Director          June 28, 1997     Next Annual
                                                           Meeting

Robert B. Gregory      45                Vice President    July 1, 1996    N/A
                       of Finance


David D. McCurley      31                Vice President    June 10, 1996   N/A
                       & Chief Technical
                       Officer

</TABLE>

Daniel Wettreich

      Daniel  Wettreich is Chairman and Chief Executive Officer,  President  and
Director of the Company since September 1988.  He is also a Director and Officer
of all its subsidiaries<F1>.  Since 1981, he has been the President and Director
of Wettreich Financial Consultants, Inc., a financial consulting company.  Since
July 1996, he has been Director and Chief Executive Officer of Meteor Technology
plc,  a  United Kingdom based public company.  Additionally, he currently  holds
directors positions in the following public companies:  Forme Capital,  Inc.,  a
real  estate  company,  Adina, Inc. and Alexander Mark Investments  (USA),  Inc.
which are public holding companies, and Malex, Inc., and Tussik, Inc. which  are
dormant  companies seeking merger opportunities.  In July 1993, he was appointed
Director  of  Goldstar  Video Corporation<F2> following  an  investment  by  the
Company.   From  January  1985 to February 1988 he was a  founding  director  of
Phoenix  Network,  Inc.,  a telecommunications company listed  on  the  American
Stock  Exchange.    Mr.  Wettreich was an executive  with  two  London,  England
merchant  banks  in  the  mid 1970's.  Subsequently he was  owner/manager  of  a
private  distribution company, and thereafter Chief Financial Officer of  a  $60
million  retailer  listed on the London Stock Exchange.   Mr.  Wettreich  has  a
Bachelor  of Arts in Business Administration from the University of Westminster,
London, England.

Jeanette P. Fitzgerald

      Jeanette  Fitzgerald  is  Vice President and  General  Counsel,  Corporate
Secretary and a Director of the Company since September 1988.  She is a director
and  secretary of the Company's subsidiaries<F1>.  She is a member of the  State
Bar  of  Texas and the Business Law section.  Since July 1996, she  has  been  a
Director  of  Meteor  Technology plc.  She is also the Corporate  Secretary  and
Director  of Wettreich Financial Consultants, Inc., and of Malex, Inc.,  Tussik,
Inc. and Alexander Mark Investments (USA), Inc., which are public companies.  In
July  1993,  she  was  appointed  Director  of  Goldstar  Video  Corporation<F2>
following an investment by the Company.  Previous to these positions, from  1987
to  1988 she worked as a staff attorney and in the compliance department at H.D.
Vest, Inc., a holding company with subsidiaries including a securities brokerage
firm.   She graduated from Texas Tech University School of Law receiving both  a
Doctorate of Jurisprudence and a Masters of Business Administration in May 1986,
and  from the University of Michigan with a Bachelors of Business Administration
in December 1982.

Allan S. Wolfe

      Allan S. Wolfe has been a Director of the Company since May, 1993.  He  is
Chairman  and  President  of  Database  Technologies,  Inc.,  a  public  company
providing  database  software to the insurance industry from  May  1986  to  the
present.   He  is  also, since 1984, a director and Chief Executive  Officer  of
Pathfinder  Data  Group  ("PDG"), a database  company.   A  subsidiary  of  PDG,
Pathfinder Data, Inc., filed for protection from creditors under Chapter 11  and
has since been converted to Chapter 7.

Bruce Baldwin

     Bruce Baldwin has been a Director of the Company since May 1997.  He is the
principal  of the Law Office of Bruce Baldwin since 1992.  Previous to  that  he
was  a  principal of Bruce Baldwin & Associates from 1988 to 1992.  He graduated
from  Georgia  Institute of Technology, graduating with a B.S. in chemistry  and
obtained a Bachelor of Law Degree from Mercer University in 1961.

Robert B. Gregory

      Robert Gregory is the Vice President of Finance for the Company since July
1996.   He  is  a director of Adina, Inc.  since January 1997, and of  Alexander
Mark  Investments  (USA),  Inc.  since Dember 1996  both  of  which  are  public
companies.  He was previously Director of Finance of Jenkens & Gilchrist, one of
Texas's  largest  law firms, prior to which he was controller of  Memorex  Telex
Corporation, a manufacturer of computer equipment.  Previously, from 1985 he was
controller  of  the  communications division  of  Electronic  Data  Systems,  an
international  provider  of information technology.   In  addition  to  being  a
Certified Public Accountant, he has an MBA from Creighton University and a BS in
Accounting from the University of Nebraska.

David D. McCurley

     David McCurley is Vice President and Chief Technical Officer of the Company
since  June  1996.   He  was previously Vice President of Programming  of  Third
Planet  Publishing,  Inc., since 1994.  Previously, from 1989,  he  was  Systems
Coordinator for South Trust Bank.


(1)  A  subsidiary, Camelot Entertainment, Inc., filed Chapter 7 liquidation  in
January 1995.

(2) Goldstar Video filed for protection from creditors pursuant to Chapter 11 in
October 1993, and has converted to a liquidation proceeding.


Item 11.      Executive Compensation

    The  following table lists all cash compensation exceeding $100,000 paid  to
Company's executive officers for services rendered in all capacities during  the
fiscal  year ended April 30, 1997.  No bonuses were granted to any officer,  nor
was any compensation deferred.

                           SUMMARY COMPENSATION TABLE

                       Annual Compensation     Long-Term           
                            Compensation
                                         Payouts           
                                Awards
                                                                  
                                Restric                           
Name and Pri                  Other Annual  ted    Options/     LTIP       All
ncipal        Year  Salary  B Compensation Stock     SARs     Payouts     Other
  Position                  o   Award(s                       Compensa
                            n      )                            tion
                            u
                            s
                                                              
Daniel        1995     -    - -    -      25,000       -      $ <F1>
Wettreich     1996  $208,3  - -    -      25,000       -      $ <F1>
Chairman and  1997    33    - -    -      175,000      -      $ <F1>
CEO<F1>             $250,0
                      00
Jeanette P.   1995     -    - -    -      43,750       -      $ <F1>
Fitzgerald    1996    N/A   - -    -        N/A        -      $ <F1>
Vice          1997    N/A   - -    -        875        -      $ <F1>
President,
General
Counsel and
Secretary
<F1>

[FN]


(1)   Daniel  Wettreich  and  Jeanette Fitzgerald,  Directors  and  Officers  of
Company,  were  employees  of a company affiliated  with  Mr.  Wettreich,  which
company  provided the Company with management services until July 1995  and  was
paid  $-0-, $44,000, and  $286,000 for the years ended April 30, 1997, 1996  and
1995  respectively.   In  July 1995, Mr. Wettreich  and  Ms.  Fitzgerald  became
employees of Company and Mr. Wettreich entered into an employment contract  with
Company.
[/FN]

     Directors of the Company are reimbursed for reasonable expenses incurred in
attending  meetings  of  the  Board of Directors.  Mr.  Bruce  Baldwin  receives
$500.00 per month.

      Company  has  no compensatory plans or arrangements whereby any  executive
officer  would  receive  payments from the Company or a  third  party  upon  his
resignation,  retirement  or termination of employment,  or  from  a  change  in
control  of  Company or a change in the officer's responsibilities  following  a
change in control other than Mr. Wettreich.

      On  July  1,  1995, Company entered into an employment contract  with  Mr.
Wettreich  whereby  he  was employed as Chairman, Chief  Executive  Officer  and
President  of  the  Company for a period of ten years at  an  annual  salary  of
$250,000  and  a  cash bonus equal to 5% of the Company's annual profits  before
taxation.   In  the  event  of Mr. Wettreich's death  during  the  term  of  the
agreement,  Company will pay annual death benefits of $250,000 for a  period  of
four  years.   Mr. Wettreich may terminate his employment after the  date  of  a
change  in control of the Company.  A change in control is defined as any person
other  than  Mr.  Wettreich  or his family interests becomes  beneficial  owner,
directly or indirectly of common stock of the Company representing 30%  or  more
of  the Company's issued and outstanding common stock or if the Incumbent  Board
as  defined, ceases to constitute a majority of the board of directors.  If  Mr.
Wettreich terminates his employment after a change of control in the company, he
shall  be  paid  (i) the base salary and any bonuses payable to  him  under  the
agreement  or (ii) an amount equal to the product of the annual base salary  and
bonus  paid  to  Mr.  Wettreich during the year preceding the  termination  date
multiplied  by  five  whichever of (i) or (ii) is more.   In  the  circumstances
whereby Mr. Wettreich terminates his employment for good reason, as defined,  he
will  receive  payments in accordance with the payments received if  termination
occurs after a change of control of the Company

Item 12.  Security Ownership of Certain Beneficial Owners and Management

     The following table sets forth as of July 18, 1997 information known to the
management of the Company concerning the beneficial ownership of Common Stock by
(a)  each person who is known by the Company to be the beneficial owner of  more
than  five percent of the shares of Common Stock outstanding, (b) each  director
at  that  time,  of the Company (including principal directors of  subsidiaries)
owning  Common  Stock,  and  (c)  all directors  and  officers  of  the  Company
(including principal directors of subsidiaries) as a group (8 persons).

Name and Address of      Amount and Nature of                    Percent
Beneficial Owner         Beneficial Ownership                    of Class

Daniel Wettreich          1,626,544     <F1><F2><F8>               52.2%
17770 Preston Road
Dallas, Texas 75252

Jeanette P. Fitzgerald      152,450     <F3>                        5.1%
17770 Preston Road
Dallas, Texas 75252

Allan Wolfe                   6,625      <F4>                          *
390 South River Road
Suite 5
Bedford, NH  03110

Bruce Baldwin                  2,000     <F5>                           *
8150 Central Expressway
Suite 100
Dallas, Texas 75206

David McCurley                21,500     <F6>                           *
17770 Preston Road
Dallas, Texas  75252

Robert Gregory             1,453,718    <F7><F8>                   49.6%
17770 Preston Road
Dallas, Texas  75252

All Officers and Directors 1,718,919    <F1><F2><F3><F4>           53.6%
as a group (6 persons)                  <F5><F6><F7><F8>

* Under 0.1%

Adina, Inc.                     1,443,218    <F8>                 49%
17770 Preston Road
Dallas, Texas  75252


   (1)   60,366  of these shares are owned by AM Investments Ltd. a U.K. company
      ("AM") of which Mr. Wettreich is a director and officer. 25,000 of these 
      shares are owned by Wettreich Financial Consultants, Inc. ("WFC"), a Texas
      company of which Mr. Wettreich is a director and officer.  16,250 of 
      these shares are owned by Forme Capital, Inc., ("Forme"), a Delaware com-
      pany of which Mr. Wettreich is a director and officer.   81,710 of these 
      shares are owned by Meteor Technology plc ("Meteor"), a UK company of 
      which Mr. Wettreich is a director and officer. 1,443,218 of these are 
      Preferred Stock owned by Adina, Inc.,("Adina") a Delaware corporation of 
      which, Mr. Wettreich is a director and officer.  Mr. Wettreich has dis-
      claimed  any beneficial interest in the shares owned by AM, WFC, Forme,
      Meteor and Adina.
   
   (2)  Includes options to purchase 200,000 shares granted to Daniel Wettreich,
      which options are not exercised.
   
   (3)  Includes options to purchase 53,750 shares granted to Jeanette 
      Fitzgerald, which options are not exercised. 16,250 of these shares are 
      owned by Forme of which Ms. Fitzgerald is an officer and director.  81,710
      of these shares are owned  by Meteor of which Ms. Fitzgerald is an 
      officer and director.   Ms. Fitzgerald has disclaimed any beneficial 
      interest in the shares owned by Meteor and Forme.
   
   (4) Includes an option to purchase 6,625 shares granted to Allan Wolfe, which
      option is not exercised.
   
   (5) Includes an option to purchase 2,000 shares granted to Bruce Baldwin 
       which option is not exercised.

   (6) Includes an option to purchase 21,500 shares granted to David McCurley,
      which option is not exercised.
   
   (7) Includes options to purchase 10,500 shares granted to Robert Gregory,
      which options are not exercised.  Includes 1,443,218 Preferred Shares
      owned by Adina of which Mr. Gregory is an officer and director.  Mr. 
      Gregory has disclaimed any beneficial interest in the shares owned by 
      Adina.
   
   (8) Includes 1,443,218 Preferred Shares, Series J of the Company.  These 
     shares are owned by Adina, Inc. of which Mr. Wettreich and Mr. Gregory are
     directors and officers.  They have disclaimed all beneficial ownership 
     in the shares.  (See Item 13.  Certain Relationships and Related 
     Transactions).

Item 13.  Certain Relationships and Related Transactions

      On  May 20, 1997 Registrant subscribed (post reverse) 1,345,294 restricted
Preferred Shares, Series J Camelot Corporation ("Camelot") with payment  by  the
transfer  of  6,029,921 restricted common shares of Alexander  Mark  Investments
(USA),  Inc.  to  Camelot.   892,214 of the Preferred Shares  were  issued  upon
execution  of  the Agreement and 453,080 are issuable as deferred consideration.
The  deferred consideration will be issued as new common shares of  Camelot  are
issued  in  such a manner so that the additional Preferred Shares are issued  at
the  same time and in the same quantity as any new common shares.  The Preferred
Shares  have  one  vote  per  share and vote with the  common  shares,  are  non
convertible,  non-yielding and are subordinate to outstanding  preferred  shares
but have a liquidation preference over common shares.

      The Company paid management fees of $44,000 in 1996 to Wettreich Financial
Consultants,  Inc.  ("WFC"), a company affiliated  with  the  President  of  the
Company.   These management services consisted of the provision of the  services
of the President and Corporate Secretary of Company.   The amount was determined
by  the  time,  effort,  and  skill required to  provide  these  services.   The
President  and  the  Corporate Secretary of Company were employees  of  WFC  and
during the fiscal year ended April 1995, received no compensation from Company.

      Stock  Transfer  Company of America, Inc., a company affiliated  with  the
President of the Company provided services during the year ended April 1997  and
1996, as a securities transfer agent.  A total of $35,158 and $16,598 were  paid
by  Company  for these services.  In the opinion of the Board of Directors,  the
terms  of these transactions was as fair to the company as could have been  made
with an unaffiliated party.

      The Company leases 10,000 square feet of offices from Forme Capital, Inc.,
a company affiliated with the President of the Company.  The lease is for a term
of  5  years commencing September 1993 at $8 per square foot.  Total  rent  paid
during fiscal 1997 and 1996 was $80,000, respectively.  The lease agreement  and
transactions related thereto were approved by a vote of Company's shareholders.

      The  Company  received loans from Forme totaling $406,000 in fiscal  1995.
Payments  of  $236,000  and $190,000 were made in fiscal years  1996  and  1995,
respectively.  Forme converted the remaining balance of $450,000 to common stock
during fiscal 1996.  Total interest paid during fiscal 1996 was $11,615 and 1995
was $35,961.

      During fiscal 1997 and 1996, Company received dividend payments from Forme
Capital,  Inc., Preferred Shares Series C in the amount of $46,657 for 1997  and
$46,657 for 1996.

      On  January  17,  1996, the Company's disinterested directors  approved  a
secured  loan to the Corporate Secretary  in the amount of $75,156.   This  loan
bears interest at a rate 6% per annum.

      On   August  1,  1996,  the Company's disinterested directors  approved  a
secured  loan  to the Corporate Secretary in the amount of $14,000.   This  loan
bears  interest at a rate of 6% per annum and has been repaid as of January  31,
1997.

      On  September  25, 1996 the Company's disinterested directors  approved  a
secured loan to the President of the Company in the amount of $1,800,000.   This
loan bears interest at a rate of 6% per annum.

      On March 4, 1997, the Company acquired the US and Canadian rights to PCAMS
software  a  payphone  contract  and  management  system  software  from  Meteor
Technology, plc payable by the cancellation of 2,000,000 British pounds sterling
of loan stock owed to the Company by Meteor and 500,000 British pounds sterling
by the issuance by the Company to Meteor of 80,960 restricted  common shares.
Mr.  Wettreich and Ms. Fitzgerald  who are directors  of  both  companies did
not participate in  any  directors  votes  in relation to this transaction.

     On May 20, 1997, the Company's subsidiary Third Planet amended the terms of
its existing distribution agreement with DigiPhone International a subsidiary of
Meteor.   Mr. Wettreich and Ms. Fitzgerald who are directors of these  companies
did not participate in any directors votes in relation to this transaction.

      In  May,  1997,  the Company accepted a Preferred Share,  Series  J  stock
subscription  by  Adina, Inc., a public company of which Mr. Wettreich  and  Mr.
Gregory  are directors and officers.  Mr. Wettreich did not participate  in  any
directors  vote  in  respect  to this transaction.  The  consideration  for  the
issuance of the Preferred Shares was the transfer of eighty (80%) percent of AMI
a  public  company  whose  major  asset is  fifty-seven  (57%)  percent  of  the
outstanding ordinary shares of Meteor.  The Preferred Shares, Series J have  one
vote  per  share  voting with the common shares, have a liquidation   preference
over  the common shares but are subordinate to the outstanding Preferred Shares,
are not convertible and pay no dividend.  They also are subject to a forward  or
reverse  split  in any instances for which the common shares are  subject  to  a
forward or reverse split on the exact same basis.

      On  May  30,  1997,  the  Company subscribed for 500,000 British pounds 
sterling  1997-2007  10% unsecured  redeemable loan stock of Meteor by paying
cash.  Mr. Wettreich and Ms. Fitzgerald who are directors of both companies
did not participate  in  any directors votes in relation to this transaction.

     The Company has no compensatory plans or arrangements whereby any executive
officer  would  receive  payments from the Company or a  third  party  upon  his
resignation,  retirement  or termination of employment,  or  from  a  change  in
control of the Company or a change in the officer's responsibilities following a
change in control other than Mr. Wettreich.  Under the 1996 Stock Option Plan or
under  the  Company's 1991 Outside Directors Stock Option Plan  options  granted
under these plans contain provisions pursuant to which the unvested portions  of
outstanding  options  become immediately exercisable and  fully  vested  upon  a
merger  of  the  Company  in  which the Company's stockholders  do  not  retain,
directly  or indirectly, at least a majority of the beneficial interest  in  the
voting stock of the Company or its successor, if the successor corporation fails
to  assume  the  outstanding  options or substitute options  for  the  successor
corporation's stock to replace the outstanding options.  The outstanding options
will  terminate to the extent they are not exercised as of consummation  of  the
merger, or assumed or substituted for by the successor corporation.

                                     PART IV

Item  14.          Exhibits, Financial Statement Schedules, and Reports on  Form
8-K

(a)  (1) The following financial statements are included herein for fiscal  year
ended April 30, 1996.

Index to Consolidated Financial Statements        Page

Report of Independent Auditors - 1997             F-1
Consolidated Financial Statements
        Balance Sheets - April 30, 1997 and 1996  F-2 and
                                                  F-3
        Statements of Operations for the years
          ended April 30, 1997, 1996 and 1995     F-4

        Statements of Stockholders' Equity for the
          years ended April 30, 1997, 1996 and 1995    F-5 through
                                                  F-7
        Statements of Cash Flows for the years ended
          April 30, 1997, 1996 and 1995           F-8 and
                                                  F-9

        Notes to Consolidated Financial Statements     F-10 through
                                                  F-30

(a) (2) Consolidated Schedule                     F-31
(a) (3) Exhibits included herein:
   3(a) Articles of Incorporation  Incorporated by reference to Form 10
                                    Registration  Statement filed  on  June  23,
1976.

    3(b)  Bylaws                      Incorporated by Reference  as  immediately
above.

    10(b) 1991 Outside Directors'
          Stock  Option  Plan          Incorporated by reference  to  the  Proxy
                                       Statement for April 13, 1992 Annual
                                       Meeting of Shareholders and the Proxy
                                       Statement for January 3, 1997 Annual
                                       Meeting of Shareholders.

        1996 Employee Stock Option
          Plan                         Incorporated by reference to  the  Proxy
                                       Statement for January 3,1997  Annual
                                       Meeting of Shareholders

   22(a)  Subsidiaries
     (7)  Reports on Form 8-K:
          Report filed May 20, 1997 reporting Item 2 and 7 with amendments.


<PAGE>
                           EXHIBIT 22(a)
                            SUBSIDIARIES
                         AS OF JULY 5, 1997


Third Planet Publishing, Inc.          100%
Mr. CD-ROM Stores, Inc.                100%
Camelot Distributing, Inc.             100%
Kids University, Inc.                  100%
Maxmedia Distributing, Inc.            100%
Camelot Internet Access Services, Inc. 100%
Camelot Business Investigations, Inc.  100%
Camelot Energy, Inc.                   100%
Software @ Cost + 10%, Inc.            100%
mrcdrom.com, inc.                      100%
Alexander Mark Investments (USA), Inc.  80%
Atlantic Media, Inc.                   100%
Camelot Creative Design, Inc.          100%


                             SIGNATURES

      Pursuant  to  the  requirements of Section 13 or 15(d) of  the  Securities
Exchange  Act of 1934, the Company has duly caused this report to be  signed  on
its behalf by the undersigned, thereunto duly authorized.

CAMELOT CORPORATION
(Company)


By:   /s/Daniel Wettreich
      President

Date:     July 29, 1997


      Pursuant to the requirements of the Securities Exchange Act of 1934,  this
report  has been signed below by the following persons on behalf of the  Company
and in the capacities and on the dates indicated.


By:  /s/Daniel Wettreich
     Director; President and CEO
     (principal executive officer and
      principal financial officer)

Date:   July 29, 1997


By:  /s/Jeanette Fitzgerald
     Director; Secretary;
        Vice President and General Counsel

Date:   July 29, 1997

By:   /s/Robert Gregory
      Vice President Finance (principal accounting officer)


Date:    July 29, 1997

By:  /s/Allan Wolfe
     Director

Date:    July 29, 1997


By:   /s/ Bruce Baldwin
     Director

Date:    July 29, 1997

 <PAGE>
                                        
                                        
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 1996 and the  related
consolidated statements of operations, stockholders' equity, and cash  flows
for  each  of  the  three 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 1996, and  the
consolidated results of their operations and their consolidated  cash  flows
for  each  of  the  three  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 three 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.



Dallas, Texas
July 7, 1997
<PAGE>
                      CAMELOT CORPORATION AND SUBSIDIARIES
                           Consolidated Balance Sheets
                                    April 30,
                                        

                                                    1997     1996
                                     ASSETS

CURRENT ASSETS
 Cash and cash equivalents                $  3,029,999 $  9,870,599
 Trading securities                                  -    1,341,508
 Securities available for sale                    8,268     945,777
 Accounts receivables, net of allowance for
   doubtful accounts of $19,947 and $11,415
   at April 30, 1997 and 1996, respectively    162,592     241,837
 Prepaid expenses                              167,769     215,073
 Inventories, net of allowance for
   obsolescence of $494,744 and $198,000 at
   April 30, 1997 and 1996, respectively        530,926   1,272,973
     Total current assets                     3,899,554  13,887,767

PROPERTY AND EQUIPMENT - AT COST
 Office equipment and fixtures                1,534,173  1,363,484
 Leasehold improvements                          64,154    222,124
                                              1,598,327  1,585,608
    Less accumulated depreciation              (669,535)  (453,450)
    and amortization
                                                928,792  1,132,158

INVESTMENT IN AFFILIATE                              -          -

OTHER ASSETS
 Note receivable - officer, net of allowance    968,189         -
    of $889,000
 Preferred stock-related party                  530,917    530,917
 Licenses, trademarks and product
   development, net of accumulated
   amortization of $31,000 and $151,979
   at April 30, 1997 and 1996, respectively     421,510  1,141,021
 Other                                           23,114     10,000
     Total other assets                       1,943,730  1,681,938

                                            $ 6,772,076 $16,701,863

See accompanying notes to consolidated financial statements
                      CAMELOT CORPORATION AND SUBSIDIARIES
                     Consolidated Balance Sheets - Continued
                                    April 30,


                                                  1997         1996

                                        
                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
 Accounts payable                          $    470,577 $    777,181
 Accrued expenses                               222,990      194,329
 Net current liabilities of
   discontinued operations                            -       50,185
     Total current liabilities                  693,567    1,021,695


STOCKHOLDERS' EQUITY
 Common stock, $.01 par value, 50,000,000 shares
  authorized, 881,763 and 486,305 shares
  issued at April 30, 1997 and 1996, respectively  8,818       4,863
 Preferred stock, $.01 par value, 100,000,000
 shares authorized, 2,438,056 and 10,143,389
 shares issued and outstanding at April 30,
 1997 and 1996, respectively                     24,381      101,434
 Additional paid-in capital                  34,021,361   30,600,613
 Accumulated deficit                       (25,182,832)  (12,186,463)
 Less net unrealized loss on available-
 for-sale securities                              -          (50,548)
 Less treasury stock, at cost, 28,745
  shares at April 30, 1997 and 1996         (2,714,575)   (2,714,575)
 Less note receivable from officer
  related to purchase of common stock          (78,644)      (75,156)
     Total stockholders' equity              6,078,509    15,680,168

                                           $ 6,772,076   $16,701,863


See accompanying notes to consolidated financial statements
                                        
<PAGE>
                                        
                      CAMELOT CORPORATION AND SUBSIDIARIES
                      Consolidated Statements of Operations
                              Years Ended April 30,
                                        
  
                                      1997            1996         1995
  
  REVENUES                      $  1,887,617     $  3,002,049 $ 1,184,469
  
  COSTS  AND EXPENSES
    Cost of sales                  1,559,189         645,127      905,330
    General and administrative     7,164,354       6,233,501    2,511,108
    Provision for inventory obso
     lescence                        495,942           1,000          -
    Depreciation and amortization  1,462,459         354,419      116,186
  
    Total costs and expenses      10,681,944       7,431,047    3,532,624
  
  LOSS FROM OPERATIONS            (8,794,327)    (4,428,998)   (2,348,155)
  
  OTHER INCOME (EXPENSE)
    Interest and miscellaneous       426,490         152,278        1,370
    Dividend income-related party     46,657          46,657       46,657
    Loss on disposition of assets   (509,292)      (126,931)          -
    Loss on investment in
     affiliate                   (2,693,087)             -            -
    Note receivable allowance       (889,000)            -            -
    Realized loss on sale of
     marketable securities          (583,810)            -            -
    Unrealized gain on market-
     able securities                       -          53,821          -
    Interest expense-related party         -         (11,615)       35,849)
  
     Total other income(expense)  (4,202,042)        114,210        12,178
  
  LOSS FROM CONTINUING OPERATIONS(12,996,369)    (4,314,788)   (2,335,977)
  
  DISCONTINUED OPERATIONS
    Loss from operations                 -               -       (622,350)
    Loss on disposals                    -         (250,925)     (560,577)
  
    Loss from discon-
     tinued operations                     -       (250,925)   (1,182,927)
  
     NET LOSS                    (12,996,369)    (4,565,713)   (3,518,904)
  
  DIVIDENDS ON PREFERRED
  STOCK                             ( 95,234)      (575,414)       (19,200)
  
  NET LOSS ATTRIBUTABLE TO
   COMMON STOCKHOLDERS          $(13,091,603)  $ (5,141,127) $ (3,538,104)
  
  LOSS PER SHARE:
    LOSS FROM CONTINUING OPERATIONS   (20.45)        (12.54)        (9.17)
    LOSS FROM DISCONTINUED OPERATIONS   (.00)          (.73)        (4.64)
    DIVIDENDS ON PREFERRED STOCK        (.15)         (1.67)         (.08)
    NET LOSS PER  COMMON SHARE  $     (20.60)  $     (14.94)  $   (13.895)
  
  WEIGHTED AVERAGE NUMBER OF
     COMMON STOCK AND COMMON STOCK
     EQUIVALENT SHARES OUTSTANDING   635,467        344,119        254,651
  
  See accompanying notes to consolidated financial statements
<PAGE>
                      CAMELOT CORPORATION AND SUBSIDIARIES 
             Consolidated Statements of Stockholders' Equity - continued
               For the Period from May 1, 1994 through April 30, 1997

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

Balance at      215,790  $ 2,158      239,190    $  2,392   $5,882,486
April 30,1994  

Conversion of 
Series C
preferred 
stock to 
common stock        250        3      (50,000)      (500)          497

Preferred stock
cash dividends
related party        -         -          -            -       (19,200)

Payment of 
common stock
subscribed at
April 30, 1994     3,145       31         -            -           (31)

Sale of common
stock for cash    63,084      631         -            -      1,623,216

Purchase of Max-
media Distribu-
ting, Inc.         5,125       51         -            -        143,449

Compensation for
services           3,327       33         -            -        120,480

Change in net un-
realized losses
on available for
sale securities      -         -          -             -           -

Net loss             -         -          -             -           -

                 ________________________________________________________
Balance at 
April 30, 1995     290,721    $2,907   189,190       $1,892   $7,750,897


                         CAMELOT CORPORATION AND SUBSIDIARIES
               Consolidated Statements of Stockholders' Equity - Continued
                  For the Period from May 1, 1994 through April 30, 1997


                   Accumulated   Unrealized   Treasury   Stock        Total
                   Deficit       Losses on    Stock      Sub-       Stock-
                                 Available               scription  holders'
                                 for Sale                           Equity
                                 Securities                         (Deficit)

Balance at 
April 30, 1994     $(4,101,846)  $     -      $(170,442) $(206,250) $1,408,498

Conversion of
Series C
preferred stock 
to common stock           -            -            -          -           -

Preferred stock 
cash dividends
related party             -            -            -          -     (19,200) 
 
Payment of 
common stock
subscribed at
April 30, 1994            -            -            -       206,250  $206,250

Sale of common
stock for cash            -            -            -           -   1,623,847 

Purchase of
Maxmedia
Distributing,
Inc.                      -            -            -           -     143,500  

Compensation for
services                  -            -            -           -     120,513 

Change in net
unrealized losses 
on available-for-
sale securities           -           (51,553)      -           -     (51,553) 

Net loss              (3,518,904)      -            -           -  (3,518,904)  

Balance at
April 30, 1995       $(7,620,750)    $(51,553)   $(170,442)   $ -   $(87,049)
             
                      CAMELOT CORPORATION AND SUBSIDIARIES
           Consolidated Statements of Stockholders' Equity - continued
             For the Period from May 1, 1994 through April 30, 1997
                                        
                                        
                Common     Common     Preferre    Prefer    Addition
                Stock      Stock      d Stock     red       al Paid
                Shares     Amount     Shares      Stock     in
                                                  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        
common stock   
for cash       54,844        548        -           -        3,281,001
Sale of 
preferred
stock for
cash              -          -     19,766,666   197,666     18,850,999
Common stock                                               
issued for
services        5,079       51           -          -          737,341 
        
Common stock                                               
issued to
officers for           
note
receivable      1,500       15           -          -           75,141
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   
note payable           
to related
party           15,000       150         -          -          449,850
Purchase of       -          -           -          -            -
treasury               
stock
Preferred                                                  
stock            
dividends to:    
  Related                                                 
parties           -          -           -          -           (19,200)
  Other
parties           -          -           -          -          (556,214)
Net loss          -          -           -          -            -
                       
Balance at                                                 
April 30,               
1996           486,305    $4,863       10,143,389  $101,434     $30,600,613


See accompanying notes to consolidated financial statements

                                        
                      CAMELOT CORPORATION AND SUBSIDIARIES
           Consolidated Statements of Stockholders' Equity - continued
             For the Period from May 1, 1994 through April 30, 1997


                  Accumulat    Unreali    Treasury    Stock      Total
                    ed         zed        Stock      Subscrip  Stockhold
                  Deficit      Losses                 tion      ers'
                               on                    Receivab   Equity
                               Availab                le     (Deficit)
                               le For
                               Sale
                               Securit
                               ies
Balance    at                                                    
April     30,  $(7,620,750)    $(51,553) $(170,442)   $ -      $(87,049)
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                                                        
officer 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                 
                               


See accompanying notes to consolidated financial statements

                      CAMELOT CORPORATION AND SUBSIDIARIES
           Consolidated Statements of Stockholders' Equity - Continued
             For the Period from May 1, 1994 through April 30, 1997
                                        
                                        
               Common   Common   Prefer   Prefer   Additi   Accumu    
               Stock    Stock     red      red     onal     lated      
               Shares   Amount   Stock    Stock    Paid     Deficit    
                                 Shares   Amount     in                
                                                    Capital          
                                                              
Balance at  486,350    $4,863  10,143,389 $101,434  $30,600,613 (12,186,463)
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   3,374,000        -
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        
dividends to:
  Related    
parties         -          -       -           -     (19,200)        -
  Other
parties         -          -       -           -      (76,034)       -
                                                                                
Net loss        -          -       -           -        -       (12,996,369)

Balance at    
April 30,   881,763      8,818   2,438,056  24,381   34,021,361  (25,182,832)
1997               


                                        
See accompanying notes to consolidated financial statements

                      CAMELOT CORPORATION AND SUBSIDIARIES
             Consolidated Statements of Stockholders' Equity - Continued
               For the Period from May 1, 1994 through April 30, 1997

                   Cumulative    Unrealized   Treasury    Stock     Total
                   Foreign       Losses on    Stock       Subscr    Stock
                   Currency      Available                iption    holders'
                   Transalation  for Sale                 Receiv    Equity
                   Adjustment    Securities               able


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

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

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

Common stock 
issued for 
services               -            -             -         -        -     

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

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

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

Retirement of
Series F
preferred stock        -            -             -         -        -

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

Net loss               -            -             -         -        (76,034)

Balance at
April 30, 1997     $   -         $  -             -         -    (12,996,369)


                      CAMELOT CORPORATION AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                              Years Ended April 30,
                                        1997              1996         1995
  
CASH FLOWS FROM
 OPERATING ACTIVITIES:
  Net loss                            $ (12,996,369) $ (4,565,713) $ (3,518,904)
  Adjustments to reconcile net loss
     to net cash used in operating
     activities:
  Non cash transactions for services        387,391       120,513
  Accrued interest addition to related
   party note receivable                    (60,677)       -            -
  Securities received as revenue            (64,000)   (1,950,575)      -
  Depreciation and amortization           1,462,459       354,419    116,186
  Undistributed loss in minority in-
   terest in subsidiaries                      -           -       (1,336)
  Loss on disposal of assets                509,292       191,918  22,535
  Loss on sale of trading securities        313,896        -            -
  Loss on sale of available for sale
   securities                               269,914        -            -
  Write up of securities to market value       -          (53,821)      -
  Provision for uncollectible accounts
   receivable                                 8,532        10,887  41,500
  Provision for inventory obsolescence               495,942       198,000 -
  Note receivable allowance                 889,000        -            -
  Loss on investment in affiliate         2,693,087        -            -
  Proceeds from trading securities        1,027,612        -            -
  Loss on disposal of discontinued
    operations                             -               -       560,577
  Change in assets and liabilities,
    net of effect from
    purchase of subsidiaries:
     Accounts receivable             (68,987)      (212,107)       797,005
     Prepaid expenses               47,304         (183,449)      (16,188)
     Inventories                   246,105         (864,908)      (23,865)
     Other assets                           -            -         (5,366)
     Accounts payable and accrued
      expenses                      (277,943)         88,151      (300,340)
     Obligations-discontinued
      operations                     (50,185)        (140,266)          -
       Net cash used in
       operating activities       (5,555,018)       (6,740,073)   (2,207,683)

CASH FLOW FROM INVESTING
    ACTIVITIES:
  Purchases of property and
  equipment                         (636,364)    (1,087,658)     (195,589)
  Investment in affiliate         (2,457,003)           -             -
  Collections received on
    notes receivable                  14,000               -       67,028
  Proceeds from sale of
   property and equipment                  -          11,500       31,500
  Proceeds from available
   for sales securities              718,143          93,447            -
  Proceeds from return of deposits         -          14,765        6,000
  License, trademarks and product
   development                      (412,510)      (608,800)      (40,000)
  Purchase of subsidiary                 -              -         (25,000)
  Proceeds from sale of subsidiary        -               -       184,543
  Issuance of note receivable-
   related party                  (1,814,000)             -                -
  Issuance of note receivable             -__      (312,400)            -
     Net cash provided by
     (used in) investing
      activities                  (4,587,734)     (1,889,146)        28,482

CASH FLOWS FROM FINANCING ACTIVITIES:
   Sales of common stock                   -       3,281,549    1,623,847
  Payments received on common
   stock subscribed                        -               -      206,250
  Sale of preferred stock          3,410,500      19,048,665            -
  Sale of subsidiary preferred
    stock                                  -               -      264,044
  Redemption of preferred stock            -        (66,134)            -
  Deferred offering costs            (13,114)           -             -
  Dividends paid                     (95,234)      (575,414)      (19,200)
  Purchase of treasury stock             -       (2,544,133)            -
  Payments on debt                        -         (294,200)    (190,000)
  Proceeds(payment)-notes
   payable - related parties              -         (236,000)      406,000
  Redemptions of subsidiary
   preferred stock                         -       (264,044)           -
     Net cash provided by
     financing activities          3,302,152      18,350,289    2,290,941

NET INCREASE (DECREASE) IN CASH  (6,840,600)       9,721,070    111,740

CASH AT BEGINNING OF YEAR          9,870,599         149,529       37,789

CASH AT END OF YEAR             $  3,029,999  $    9,870,599$     149,529

See accompanying notes to consolidated financial statements
                                        
                                        
                                        
                                        
                                        
                                        
                                        
                      CAMELOT CORPORATION AND SUBSIDIARIES
                      Consolidated Statements of Cash Flows
                              Years Ended April 30,
                                        
                                   1997           1996         1995
     Supplemental information:
       Cash paid for interest$      -          $   11,615   $ 38,681
     
       Cash paid for income
         taxes               $      -          $     -       $    -
     
     NONCASH INVESTING AND FINANCING ACTIVITIES
     
     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 restricted common stock as follows:

        888,000 Series BB Preferred for 8,608 shares of restricted common
        5,333,333 Series G Preferred for 56,844 shares of restricted common
        3,525,000 Series H Preferred for 53,709 shares of restricted 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.

     As  discussed in Note 2, in fiscal 1995, the Company acquired  100% of the
     common stock of Maxmedia Distributing, Inc., and Maxmedia Publishing, Inc.,
     in  exchange  for  $25,000  in cash plus 5,125 shares  of  the Company's
     restricted common stock valued at $143,500.
     
     As discussed in Note 11, in fiscal 1995, the outstanding Series C Preferred
     Stock was converted to 250 shares of the Company's restricted common stock.
     
     During fiscal 1997, 1996 and 1995 there was a $50,548, $1,005, and  $51,553
     change in net unrealized losses on available-for-sale securities.
     
     
     See accompanying notes to consolidated financial statements

1.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Business Activity and Principles of Consolidation

     The  consolidated financial statements include Camelot Corporation and  its
     majority-owned subsidiaries (collectively the "Company").  The  Company  is
     primarily engaged in the retailing, distribution and publishing of computer
     software.    The   Company   sells  software  products   through   national
     distributors  and through an Internet web page catalog.  During  1997,  the
     Company  ceased  selling  its  software products  through  Mr.  CD-ROM  and
     Software  @  Cost  +  10% retail stores which were located  in  the  Dallas
     Metroplex.   The  Company is also engaged as an Internet service  provider.
     Discontinued  operations of certain subsidiaries  were  involved  in  video
     marketing  and distribution, financial services, real estate  rentals,  and
     oil and gas exploration and 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 Dallas, Texas.  Cash equivalents  were  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.   Other
     inventories, were stated at the lower of cost or market using the first in,
     first  out  (FIFO)  method, until their disposition  in  fiscal  1995.   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.
     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, 1997, 1996
     and  1995  was $1,105,021, $138,979 and $0, respectively, which included  a
     write  down  of $646,408 in 1997 to reflect an impairment of net realizable
     value.  Capitalized software development costs were $302,510 and $1,014,021
     at  April  30, 1997 and 1996, respectively, net of accumulated amortization
     of $0 and $138,979, respectively.
     
     Total  research and development costs charged to general and administrative
     expenses  were  approximately $2,375,000, $1,319,000 and $163,000  for  the
     years ended April 30, 1997, 1996 and 1995.
     
     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 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
     $989,248, $1,648,071 and $129,436 for 1997, 1996 and 1995, 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.

     Reclassifications

     Certain  reclassifications have been made to the  financial  statements  to
     conform to the 1997 presentation.

     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, of which 1,500,000 are newly issued.

     On  June  17,  1994,  the Company acquired 100% of  the  common  stock,  of
     Maxmedia Distributing, Inc., and Maxmedia Publishing, Inc., in exchange for
     $25,000 in cash plus 5,125 shares of the Company's restricted common  stock
     valued at $143,500.  The acquired companies are engaged in the distribution
     and  publishing of CD-ROM software.  The acquisition was accounted  for  by
     the  purchase  method of accounting, and the purchase  price  exceeded  the
     estimated  fair value of net assets acquired by $201,421.  Amortization  of
     the  excess  purchase price was amortized over a fifteen year period  until
     the unamortized balance was written off in fiscal year 1996.

     On  March  2,  1994, the Company entered into an agreement  with  Americomm
     Properties, Inc. ("Americomm") to assign unencumbered, interests in certain
     licenses  to the wireless cable system in Manhattan, Kansas.  The  licenses
     require Federal Communications Commission approval to provide assignability
     and  transferability.   Licenses   and the  related  acquisition  costs  of
     $73,465 were written off in fiscal year 1996.

3.   ACCOUNTS RECEIVABLE AND CREDIT RISK

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

4.   INVENTORIES

     Included  in the accompanying April 30, 1997 balance sheet is inventory  of
     computer  software  at  a  carrying value  of  $530,926,  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,:
                                         1997              1996

     Software                      $1,025,670           $1,470,973

     Less: Allowance for slow
     moving and obsolescence           494,744            198,000

     NET                           $    530,926        $1,272,973

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 $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 and  1996  are  summarized  as
     follows:


                Cost      Gross       Gross     Estimated
                        Unrealized  Unrealized    Fair
                          Gains       Losses      Value
                                                
1997                                            
                                                
Available-
for-sale
                                                
Securities
                     $           $           $          $
Common stock     8,268           -           -      8,268
                                                         
                                                         
1996                                                     
                                                         
Available-
for-sale
                                                         
Securities
                     $           $           $          $
Common stock   996,325           -      50,548    945,777
     Trading                                             
Securities
                            53,820           -  1,341,508
Common stock  1,287,68
                     8
                                                         
                     $           $           $          $
              2,284,01      53,820      50,548  2,287,285
                     3
                                                         

     Sales  proceeds  and gross related gains and losses on  securities  are  as
     follows:

                                        
                                      
                   1997     1996    1995
     Cost basis $2,329,565 $ 134,480   $
     Proceeds    1,745,755    93,447       -
     Realized           -       -          -
     gains
     Realized      583,810    41,033       -
     losses

     The  company uses the specific identification method to determine the  cost
     of securities sold.

     Results  of operations for 1997, 1996 and 1995 include a charge  of  $  -0-
     $53,821, and $-0- for unrealized gains on trading securities.

     Stockholders'  equity  includes an unrealized  loss  of  $0,  $50,548,  and
     $51,553 at April 30, 1997, 1996 and 1995, 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,
     1997,  these  shares  had  a  market value of approximately  $209,000.  The
     allowance  of  $889,000  is  primarily to provide  for  impairment  of  the
     collateral  as a result of the fluctuation in the value of the  collateral.
     The  allowance,  which is adjusted on a annual basis, is  computed  from  a
     formula  which  utilizes  the average price of the Company's  common  stock
     using a twelve month period.

7.   INVESTMENT IN AFFILIATE

     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 over
     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
     zero  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,:
                                1997                1996

     Taxes                 $      26,811      $       56,550
     General and administrative    2,452              35,244
     Fees                         34,000              36,000
     Compensation                 41,503              32,864
     Lease obligations           115,099                   -
     Other                         3,125              33,671

                               $   222,990        $    194,329

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% for fiscal 1996 and 1995.

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, 1997, 1996 and 1995.

     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:
                                              1997    1996

       Allowance  for  doubtful  accounts     $     6,782      $           1,880
Inventories                                 168,213              66,795
     Other                                    3,958                   3,570
     Note receivable allowance              302,260                   -
     Investment valuation adjustment        915,650               (1,113)
     Capital loss carryforward             117,817              117,817
     Net operating loss carryforward      6,862,390           3,846,783
                                         8,377,070           4,035,732

            Less        valuation       allowance                    (8,377,070)
(4,035,732)

               Deferred tax asset-net    $       -        $     -


     At  April  30,  1997, the Company has approximately $20,184,000  of  unused
     Federal  net operating loss carryforwards, which expire in the  years  2003
     through 2012.

     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.

11.  STOCKHOLDERS' EQUITY

     Common Stock

     The  brother  of the President of the Company purchased 13,750  and  20,833
     shares  of the Company's restricted common stock for $470,312 and  $497,375
     in various transactions during fiscal 1996 and 1995, respectively.

     Unrelated third parties purchased 16,094 and 42,251 shares of the Company's
     restricted common stock for $795,612 and $1,126,472 in various transactions
     during fiscal 1996 and 1995, 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, 1997:

                                Number of Shares
                                        
                                        
     Series of           Originally
     Preferred Stock     AuthorizedIssued    Outstanding         Value

          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    2,330,000      23,300

     TOTAL               33,649,523 23,672,856     2,438,056        $ 24,381

     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.

     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.

     During  fiscal 1995, the outstanding Series C were converted to 250  shares
     of the Company's restricted common stock.

     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, 1997, 1996 and 1995.

     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.

     Any split or combination of common shares requires a simultaneous split or 
     combination of each series of preferred shares and visa versa.  Upon liquid
     ation 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 in non-voting.
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.

     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 87,500 at  April
     30, 1997 and 1996, respectively.

     The following schedule summarizes the changes in the Plans:


                           1997       1996       1995
                                               
Options outstanding  at     94,600     95,825     94,375
beginning at year
   Granted                 185,538      7,194      6,325
   Exercised                     -  (  4,637)          -
   Canceled               ( 4,750)  (  3,782)  (  4,875)
Options outstanding  at                94,600     95,825
end of year                275,388
                                  
                                                        
Options exercisable  at    275,388     94,600     95,825
end of year
                                                        
Average    price     of                                 
options:
   Granted during year    $ 49.348    $98.324    $48.928
     Exercised   during          -     62.208          -
year
   Canceled during year     52.160     80.140     47.692
    Outstanding at  end     12.160     31.828     29.932
of year
                                                        

     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:
     
     Incentive Stock Option Plan
     
                                                              
                               1997           1996          1995
                                                              
Options  outstanding   at                                     
beginning of year
     Granted                    408,800               -           -
     Exercised                        -               -           -
     Canceled                                                      
                                      -               -           -
Options  outstanding   at                                          
end of year                     408,800               -           -
                                                                   
Options  exercisable   at       408,800               -           -
end of year
                                                                   
Average price of options                                           
     Granted during year        $  4.00          $    -       $   -
       Exercised   during             -               -           -
year
     Canceled during year             -               -           -
      Outstanding at  end          4.00               -           -
of year
                                                                   
     
     Director's Stock Option Plan
     
                                 1997          1996         1995
                                                                   
Options   outstanding   at                                         
beginning of year
     Granted                       15,000             -           -
     Exercised                          -             -           -
     Canceled                                                      
                                        -             -           -
Options outstanding at end         15,000             -            
of year                                                           -
                                                                   
Options exercisable at end         15,000             -            
of year                                                           -
                                                                   
Average price of options                                           
     Granted during year                $   $         -           $
                                     4.00                         -
     Exercised during year              -             -           -
     Canceled during year               -             -           -
     Outstanding at end of           4.00             -           -
year
     
     The  Company  granted stock options to purchase 423,800  shares  of 
     mrcdrom.com common stock to officers and directors of mrcdrom.com, inc.
     
     The  Company  recognized and measures compensation costs related  to  stock
     option plans utilizing the intrinisic value based method.  Accordingly,  no
     compesation   cost  has  been  recorded.   Had  comensation  expense   been
     determined on the fair value of awards granted, net loss and loss per share
     would have been as follows:

                                   1997
                         As Reported         Pro forma

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

     Loss per share      $      (20.45)      $      (21.15)


                                   1996
                         As Reported         Pro forma

     Net loss            $ ( 4,565,713)      $ ( 4,928,278)

     Loss per share      $      (12.54)      $      (14.32)

     The  fair value of each option is estimated using the Black-Scholes option-
     pricing  model with the following assumptions used for grants in  1997  and
     1996:  risk  free  interest rate 4.5%; expected  life  10  years;  expected
     volitity  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, were $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 convert-
     ible 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.

     During fiscal 1997, the Company concluded agreements with Meteor Technology
     PLC,  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 6,000,000 British pounds sterling (approximately 
     $9,312,000) and an additional 1,000,000 British pounds sterling 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
     Technology PLC.  The consideration for the PCAMS software rights was the
     cancellation of 2,000,000 British pounds sterling 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 Technology, with 
     the Company owning approximately  15.2%  of Meteor Technology  PLC.
     Because of the significant influence  the  Company has over Meteor  
     Technology  PLC, the Company has accounted for these transactions as an
     equity investment in Meteor Technology PLC.  See footnote 7 discussing 
     the Company's investment in Meteor Technology, PLC.

     In  fiscal year 1996, the Company made a loan to DigiPhone Europe, Ltd.,  a
     subsidiary of Meteor Technology, PLC  ("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 $72,000, $24,000 and  $0  for the
      years 1997, 1996, and 1995, 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.

     During  fiscal  1995,  the Company issued 375 common  shares  valued  at
     $22,500  to a company affiliated with the President of one of the Company's
     subsidiaries for a customer mailing list.

     The  Company  owns  21,495 shares of Forme Capital's  Series  A,  10%  Non-
     cumulative  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
     1997, 1996 and 1995.

     During  fiscal years 1996 and 1995, a company affiliated with the President
     of  the  Company  provided the Company with management and  other  services
     valued  at  $44,000 and  $286,000, respectively.  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.  Rent expense
     incurred  with  Forme  for  fiscal 1997, 1996 and  1995  was  approximately
     $80,000 each year.  The lease included the following terms and conditions:

          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  Dallas,
     Texas area for its subsidiaries.

     Total  rent  expense, all of which were minimum rentals, for  fiscal  1997,
     1996    and    1995    was    approximately    $587,478,    $268,615    and
     $106,700,respectively.

     In  addition  to minimum lease payments, a retail lease agreement  provides
     for  contingent  rentals if certain sales levels are reached.   The  future
     minimum  lease  payments under operating leases for  office  and  warehouse
     space that have remaining non-cancelable lease terms in excess of one  year
     at April 30, 1997, are as follows:

          Year Ending Related Party     Other          Total
          April 30,
          
          1998      $   80,000      $ 148,050     $  228,050
          1999          26,667        141,243        167,910
          2000               -        139,763        139,763
          2001               -         95,000         95,000
          2002               -              -              -
          Thereafter          -              -              -
                     $ 106,667      $ 524,056     $  630,723

     The  Company  has  negotiated  or is in the process  of  negotiating  early
     termination  of its retail lease obligations.  An accrual of  $115,099  for
     the  settlement of the leases, is included in accrued expenses at April 30,
     1997.   If  the  negotiations are not successful, the  ultimate  loss  will
     probably be greater than the accrued amount.
     
     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, 1997, 1996 and
     1995.   However,  the  Company  has been able  to  improve  it's  financial
     position  through stock offerings and has been able to raise $3,410,500  in
     1997  and  $22,330,214 in 1996 through private placements.  As indicated at
     Note  17,  the Company has discontinued all but one segment to  concentrate
     its  efforts toward the retailing, distribution, and publishing  of  CD-ROM
     software.

     Management  believes  that the Company's future success  will  be  achieved
     through  sales  of  CD-ROM software and license  fees.   The  Company  owns
     DigiPhone,  a  software product which permits the full duplexing  of  voice
     over the Internet.
    
     Management is aware of the need for additional cash resources to be 
     obtained for the continuance of research and development and anticipates
     that such financial resources will primarily come from private placement
     of Camelot's common and preferred stock.  Management believes that license 
     fees received from Third Planet's products will generate revenues and
     cash flow towards the end of the current financial period.  Management
     believes that cash provided by financing activities and licensing fees
     as well as revenue from sale of software over the Internet together
     with the present level of cash resources available will be sufficient
     for its need over the next twelve months.  Management also believes
     that should the Company require additional cash resouces it can incur
     borrowing as Camelot has no long-term debt.

     While  management  believes  the  Company is  well  positioned  for  future
     profitability, there can be no assurance of future success.

16.  SALE OF SUBSIDIARIES

     On  July  6, 1994, the Company sold its 69% controlling interest in Beecher
     Energy, Ltd., for $184,543 resulting in a loss of $82,644.

17.  DISCONTINUED OPERATIONS

     On  January  31,  1995,  the  Company's video  marketing  and  distribution
     subsidiary Camelot Entertainment filed Chapter 7 bankruptcy with  the  U.S.
     Bankruptcy Court.  Revenues for this segment for fiscal 1995 were $694,666.
     Loss  from operations and disposals for fiscal 1996 and 1995 were  $250,925
     and $406,057, respectively.

     Oil  and gas revenues for fiscal 1995 were $16,964.  Loss from oil and  gas
     operations for fiscal 1995 were $3,009.

     The results of operations of the above subsidiaries have been presented  in
     the financial statements as discontinued operations.  Current assets of the
     discontinued   operations  consisted  primarily  of   cash   and   accounts
     receivable.   Current liabilities of the discontinued operations  primarily
     consist of subsidiary trade payables guaranteed by Camelot Corporation.

18.  INDUSTRY SEGMENT

     The  Company and its subsidiaries are operating in one industry segment and
     are vertically intergrated in retailing, distribution, and publishing of 
     CD-ROM software.

19.  SUBSEQUENT EVENTS

     In July 1997, the Board of Directors approved a one for forty reverse stock
     split  of  common  stock  and outstanding preferred  shares,  Series  J  to
     stockholders  of  record  on  July 15, 1997.   The  consolidated  financial
     statements,  including all references to the number  of  shares  of  common
     stock  and  all  per-share information, have been adjusted to  reflect  the
     split on a retroactive basis.

     On  May 29, 1997, the Company advanced 500,000 British pounds sterling 
     (approximately $828,250) to Meteor Technology PLC for 10% unsecured loan
      stock.
     
     In  May 1997, the Board of Directors authorized the creation of a series of
     preferred stock, Series J with 60,000,000 shares authorized.  Series J  has
     a par value of $.01 per share, does not pay dividends, are entitled to vote
     on matters submitted to a vote of the stockholders of the Company, and rank
     junior to all other series of preferred stock.

     During  May  of  1997,  Camelot  Corporation completed  a  preferred  stock
     transaction with Adina, Inc. an affiliated company.  As a result of this
     transaction, Camelot is now a majority owner of Meteor Technology, PLC
     through  Camelot's ownership of Alexander Mark Investments (USA), Inc.
     The specific transfers that occurred are as follows:
     
           On  May  9,  1997,  Alexander Mark Investments (USA),  Inc.  acquired
     40,727,988  ordinary  shares  (57% of the  outstanding  shares)  in  Meteor
     Technology  PLC from Daniel Wettreich in exchange for 6,787,998  restricted
     common shares in Alexander Mark Investments (USA), Inc.
     
           On May 15, 1997, Adina, Inc. accepted the subscription for 42,450,000
     restricted common shares of Adina, Inc. by Daniel Wettreich in exchange for
     6,029,921  restricted  common shares of Alexander Mark  Investments  (USA),
     Inc.("AMI").   AMI owns 57% of the outstanding shares of Meteor  Technology
     PLC   ("Meteor").    Meteor   has   two  active   subsidiaries,   Digiphone
     International, Ltd. and Meteor Payphones, Ltd.
     
          On May 20, 1997 Adina, Inc. the majority shareholder of Alexander Mark
     Investments  (USA),  Inc.  transferred 6,029,921 (80%  of  the  outstanding
     shares) to Camelot Corporation as payment for subscription.
     
          On May 20, 1997 Adina, Inc. subscribed 1,345,294 restricted Preferred
     Shares,  Series  J  Camelot Corporation, ("Camelot") with  payment  by  the
     transfer   of   6,029,921  restricted  common  shares  of  Alexander   Mark
     Investments  (USA),  Inc. to Camelot.  892,214 of the  Preferred  Shares
     were issued upon execution of the agreement and 453,080 are to be issued
     as  new  common shares of Camelot are issued in such a manner so  that  the
     additional  Preferred Shares are issued at the same time and  in  the  same
     quantity as any newly issued common shares.  The Preferred Shares have  one
     vote  per share and vote with the common shares, are non-convertible,  non-
     yielding  and are subordinate to outstanding preferred shares  but  have  a
     liquidation preference over common shares.

20.  SUPPLEMENTARY OIL AND GAS INFORMATION (UNAUDITED)

     All  of the Company's oil and gas properties are located in the continental
     United  States.  The following tables reflect information relating  to  the
     Company's oil and gas producing activities.
     
     Results of Operations for Producing Activities

                            1997           1996            1995
                                                      
     Sales of oil  and    $   -          $     -         $  16,964
     gas
     Production costs          -                -           (10,967)
     Provision     for         -                -        
     depletion
     depreciation              -                -            (3,250)
                          $   -          $     -         $     2,747

No  costs  were  incurred  in  oil and gas property  acquisitions,  exploration,
development activities and exploration in the three year period ended April  30,
1997.

     Capitalized  costs relating to oil and gas producing activities  were  zero
     for the three year period ended April 30, 1997.
     
     Oil and gas reserves were zero for three year period ended April 30, 1997.
     
     Proved  developed reserves were zero for the three year period ended  April
     30, 1997.

     Standards measure of discounted future net cash flows
     
     The  standardized measure of discounted future net cash flows at April  30,
     1997, 1996 and 1995 relating to provided oil and gas reserves were zero.
     
     Future  net  cash flows were computed using year-end prices and costs,  and
     year-end  statutory  tax  rates (adjusted for permanent  differences)  that
     relate  to existing proved oil and gas reserves at year-end.  The following
     are  the  principle  sources  of  change in  the  standardized  measure  of
     discounted  future net cash flows for each of the years in  the  three-year
     period ended April 30, 1997.

                                  1997     1996       1995
                                                  
     Beginning of year           $     -  $     -   $422,000
     Changes resulting from                                 
     sales   of oil and gas                                 
     produced,                                      (17,000)
     net of production costs
     Net  changes in prices and                            -
     production costs
     Revisions   of    previous                            -
     quantity estimates
     Accretion of discount                                 -
     Net   changes  in   income                            -
     taxes
     Disposition  of  oil   and        -        -           
     gas segment                                   (405,000)
     End of year                    $  -    $   -  $       -
                                                  
                                                  

21.  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
     $496,000 for inventory and $889,000 for receivables.
                                        
     <PAGE>
                      CAMELOT CORPORATION AND SUBSIDIARIES
                                        
                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                                        
                    Years Ended April 30, 1997, 1996 and 1995
                                        
                                        
     Description
     
     Allowance deducted
     from assets to which
     it applies:

                                    Additions
       Accounts    Balance   Charged  Charged                 Balance
     Receivables     at     to Costs     to                     at
      Year Ended  Beginnin     and     Other    Deductions    End of
                    g of    Expenses  Account                 Period
                   Period                s
      April 30,    $ 11,415   $ 8,532        -         $  -    $19,947
         1997
                                                                      
      April 30,      36,419    10,887        -       35,891     11,415
         1996                                           (a)
                                                                      
      April 30,     365,448    41,500        -   370,529(a)      36,419
         1995
                                                                      
        Notes                                                         
      Receivable
      Year Ended
                                                                      
      April 30,           $         $        $            $  $ 889,000
         1997             -   889,000                     -
                                                                      
      April 30,           -         -        -            -           
         1996                                                        -
                                                                      
        April        75,000   7,972  2       -       82,972          -
       30,1995                                          (a)
                                                                      
     Inventories                                                      
      Year Ended
                                                                      
      April 30,    $198,000  $495,942  $     -    $ 199,198   $494,744
         1997
                                                                      
        April                 198,000        -            -    198,000
       30,1996            -
                                                                      
        April             -         -                     -          -
       30,1995                               -
                                                                      
                                                                      




      (a) Uncollected receivables written off, net of recoveries