UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended January 31, 2012
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
Commission File Number 000-8299
CAMELOT CORPORATION
(Name of registrant as specified in its charter)
Nevada 84-0691531
(State or other jurisdiction (IRS Identification No.)
of incorporation or organization)
17 Sutton Way
Washington Twp NJ 07676
(Address of principal executive offices)
201-970-4987
(Registrant's telephone number)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [X] Yes No [ ]
Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files). [X] Yes [ ] No
Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definition of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer [ ] Accelerated filer [ ]
Non-accelerated filer [ ] Smaller reporting company [X]
(Do not check if a smaller reporting company)
Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act). [X] Yes [ ] No
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distributions of securities under a plan
confirmed by a court. [ ] Yes [ ] No [X] N/A
APPLICABLE TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date. Class - Common Stock, 2,006,528
shares outstanding as of March 16, 2012.
CAMELOT CORPORATION
INDEX TO FORM 10-Q
Page No.
--------
PART I FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)............................... 3
Balance Sheets ............................................. 3
Statements of Operations ................................... 4
Statements of Cash Flows.................................... 5
Notes to Financial Statements............................... 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations...................................... 10
Item 3. Quantitative and Qualitative Disclosures about Market Risk..... 12
Item 4. Controls and Procedures........................................ 12
PART II OTHER INFORMATION
Item 1. Legal Proceedings.............................................. 13
Item 1A. Risk Factors................................................... 13
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.... 13
Item 3. Defaults Upon Senior Securities................................ 13
Item 4. Removed and Reserved........................................... 14
Item 5. Other Information.............................................. 14
Item 6. Exhibits....................................................... 14
Signature................................................................ 15
2
CAMELOT CORPORATION
Balance Sheets
(An Exploration Stage Company)
January 31,2012 April 30, 2011
--------------- --------------
(Unaudited)
ASSETS
Current assets
Cash and cash equivalents $ 4,586 $ 7,317
Prepaid Expenses -- --
------------ ------------
Total current assets 4,586 7,317
Other assets
Mineral rights-leased (Note 7) -- 11,457
------------ ------------
Total Assets $ 4,586 $ 18,774
============ ============
LIABILITIES AND STOCKHOLDERS' (DEFICIT)
CURRENT LIABILITIES
Accounts payable-non related party $ 75,892 $ 65,294
Accounts payable-related party 1,654 1,654
Accrued interest payable 20,292 12,544
Advances payable, related party 65,025 50,025
------------ ------------
TOTAL CURRENT LIABILITIES 162,863 129,517
Note payable 117,000 117,000
------------ ------------
TOTAL LIABILITIES 279,863 246,517
------------ ------------
COMMITMENTS AND CONTINGENCIES (NOTES 1,2, 4, 5, 6, 7, AND 8)
STOCKHOLDERS' (DEFICIT)
Preferred stock $0.01 par value 100,000,000 shares authorized; none issued -- --
Common stock $0.01 par value; 50,000,000 shares authorized;
2,006,528 shares issued and outstanding 20,065 20,065
Additional paid-in-capital 32,849,816 32,849,816
Accumulated deficit (33,032,881) (33,032,881)
Accumulated deficit during the exploration stage (112,277) (64,743)
------------ ------------
Total stockholders' (deficit) (275,277) (227,743)
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' (DEFICIT) $ 4,586 $ 18,774
============ ============
3
CAMELOT CORPORATION
Statements of Operations
(An Exploration Stage Company)
(Unaudited)
For the period from
June 11,2010
(date of
Nine Months Nine Months Three Months Three Months exploration stage)
Ended Ended Ended Ended through
January 31, January 31, January 31, January 31, January 31,
2012 2011 2012 2011 2012
---------- ---------- ---------- ---------- ----------
Revenues $ -- $ -- $ -- $ -- $ --
Operating Expenses
Professional fees 23,404 40,896 3,717 3,596 74,440
Other 924 760 110 360 5,972
---------- ---------- ---------- ---------- ----------
TOTAL OPERATING EXPENSES 24,328 41,656 3,827 3,956 80,412
---------- ---------- ---------- ---------- ----------
(LOSS) FROM OPERATIONS (24,328) (41,656) (3,827) (3,956) (80,412)
OTHER INCOME (EXPENSE)
Interest (expense) (7,749) (6,963) (2,511) (3,453) (16,408)
Cancellation of mining property
lease (See Note 7) (15,457) -- (15,457) -- (15,457)
---------- ---------- ---------- ---------- ----------
NET (LOSS) (47,534) (48,619) (21,795) (7,409) (112,277)
========== ========== ========== ========== ==========
Loss per share basic and diluted $ (0.02) $ (0.02) $ (0.01) $ Nil $ (0.06)
========== ========== ========== ========== ==========
Weighted average number of
common shares outstanding
basic and diluted 2,006,528 2,006,528 2,006,528 2,006,528 2,006,528
========== ========== ========== ========== ==========
4
CAMELOT CORPORATION
Statements of Cash Flows
(An Exploration Stage Company)
(Unaudited)
For the period from
June 11,2010
(date of
Nine Months Nine Months exploration stage)
Ended Ended through
January 31, January 31, January 31,
2012 2011 2012
---------- ---------- ----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (47,534) $ (48,619) $ (112,277)
Adjustments to reconcile net income (loss) to
net cash used in operating activities
Changes in operating assets and liabilities:
Decrease prepaid expense -- 433 379
Increase in mineral rights- leased 15,457 -- 15,457
Increase in accrued interest payable 7,749 6,963 16,409
Increase in accounts payable 6,597 18,583 46,075
---------- ---------- ----------
Net cash (used in) operating activities (17,731) (22,640) (33,957)
---------- ---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Decrease in Mineral rights- leased -- (11,457) (11,457)
---------- ---------- ----------
Net cash (used in) investing activities -- (11,457) (11,457)
---------- ---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Paid in capital
Advances from related party 15,000 35,000 50,000
---------- ---------- ----------
Net cash provided by financing activities 15,000 35,000 50,000
---------- ---------- ----------
Net (decrease) in cash and cash equivalents (2,731) 903 4,586
Cash and cash equivalents at beginning of period 7,317 13,857 --
---------- ---------- ----------
Cash and cash equivalents at end of period $ 4,586 $ 14,760 $ 4,586
========== ========== ==========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Interest $ -- $ -- $ --
========== ========== ==========
Income Taxes $ -- $ -- $ --
========== ========== ==========
SUPPLEMENTAL DISCLOSURES OF NON-CASH TRANSACTIONS
Exchange of accounts payable for note payable $ 117,000
==========
5
Camelot Corporation
(An Exploration Stage Company)
Notes to Financial Statements
January 31, 2012
1. OVERVIEW AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF PRESENTATION
Camelot Corporation, ("the Company") was incorporated under the laws of the
State of Colorado on September 5, 1975. The Company was formerly a holding
company but since it ceased operations in the fiscal year ended April 30, 1999,
the Company has had minimal operations. All previous business activities have
been discontinued.
Our plan of operation for the next twelve months is to secure a property on
which we will carry out an exploration program.
The Company's fiscal year end is April 30.
INTERIM FINANCIAL STATEMENTS
The accompanying interim unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information and with the instructions to Form 10-Q and Article 8 of Regulation
S-X. Accordingly, they do not include all of the information and footnotes
required by generally accepted accounting principles for complete financial
statements. In our opinion, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation statement of the results
for the interim periods have been made, and all adjustments are of a normal
recurring nature. Operating results for the nine month period ended January 31,
2012 are not necessarily indicative of the results that may be expected for the
year ending April 30, 2012. For further information, refer to the financial
statements and footnotes thereto included in our Form 10-K Report for the fiscal
year ended April 30, 2011.
REVENUE RECOGNITION
The Company has not generated any revenues since it ceased operations in 1999.
It is the Company's policy that revenues are recognized when persuasive evidence
of an arrangement exists, delivery has occurred (or service has been performed),
the sales price is fixed and determinable, and collectability is reasonably
assured.
CASH AND CASH EQUIVALENTS
The Company considers cash in banks, deposits in transit, and highly liquid debt
instruments purchased with original maturities of three months or less to be
cash and cash equivalents.
USE OF ESTIMATES
The preparation of financial statements in conformity with US GAAP requires
management to make estimates and assumptions that affect the reported amount of
assets and liabilities and disclosure of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Management routinely makes judgments and
estimates about the effects of matters that are inherently uncertain. Estimates
that are critical to the accompanying financial statements include the
identification and valuation of assets and liabilities, valuation of deferred
tax assets, and the likelihood of loss contingencies. Management bases its
estimates and judgments on historical experience and on various other factors
that are believed to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying values of assets and
liabilities that are not readily apparent from other sources. Actual results
could differ from these estimates. Estimates and assumptions are revised
periodically and the effects of revisions are reflected in the financial
statements in the period it is determined to be necessary.
FAIR VALUE OF FINANCIAL INSTRUMENTS
ASC 825, "Disclosures about Fair Value of Financial Instruments", requires
disclosure of fair value information about financial instruments. ASC 820, "Fair
Value Measurements" defines fair value, establishes a framework for measuring
fair value in generally accepted accounting principles, and expands disclosures
about fair value measurements. Fair value estimates discussed herein are based
upon certain market assumptions and pertinent information available to
management as of January 31, 2012.
6
The respective carrying values of certain on-balance-sheet financial instruments
approximate their fair values. These financial instruments include accounts
payable, advances payable, accrued liabilities and notes payable. Fair values
were assumed to approximate carrying values for these financial instruments
since they are short term in nature and their carrying amounts approximate fair
value, or they are receivable or payable on demand.
MINERAL PROPERTY ACQUISITION AND EXPLORATION COSTS
The Company has been in the exploration stage since June 11, 2010, and has not
yet realized any revenue from its operations. Mineral property acquisition costs
are initially capitalized in accordance with accounting standards. The Company
assesses the carrying costs for impairment at each fiscal quarter end. If proven
and probable reserves are established for a property and it has been determined
that a mineral property can be economically developed, capitalized costs will be
amortized using the units-of-production method over the estimated life of the
probable reserves. To date the Company has not established any proven or
probable reserves on its mineral properties. Mineral exploration costs are
expensed as incurred.
INCOME TAXES
Deferred income taxes are determined using the liability method under which
deferred tax assets and liabilities are based upon temporary differences between
the carrying amounts of assets and liabilities for financial and tax reporting
purposes and the effect of net operating loss carry-forwards. Deferred tax
assets are evaluated to determine if it is more likely than not that they will
be realized. Valuation allowances have been established to reduce the carrying
value of deferred tax assets in recognition of significant uncertainties
regarding their ultimate realization.
BASIC AND DILUTED EARNINGS (LOSS) PER SHARE
The Company computes earnings (loss) per share in accordance with ASC 260-10-45
"Earnings per Share", (SFAS 128) which requires presentation of both basic and
diluted earnings per share on the face of the statement of operations. Basic
earnings (loss) per share is computed by dividing net earnings (loss) available
to common shareholders by the weighted average number of outstanding common
shares during the period. Diluted earnings (loss) per share gives effect to all
dilutive potential common shares outstanding during the period. Dilutive
earnings (loss) per share excludes all potential common shares if their effect
is anti-dilutive. The Company has no potential dilutive instruments, and
therefore, basic and diluted earnings (loss) per share are equal.
STOCK BASED COMPENSATION
The Company accounts for common stock issued to employees for services based on
the fair value of the instruments issued, and accounts for common stock issued
to other than employees based on the fair value of the consideration received or
the fair value of the equity instruments, whichever is more reliably measurable.
The Company did not make any option grants during 2011, and accordingly, has not
recognized any stock based compensation expense related to options.
RECENT ACCOUNTING PRONOUNCEMENTS
There were various accounting standards and updates recently issued, none of
which are expected to have a material impact on the Company's financial
position, operations, or cash flows.
2. GOING CONCERN
The Company's financial statements are prepared on a going concern basis, which
contemplates the realization of assets and the satisfaction of obligations in
the normal course of business. However, the Company has recurring losses, has
negative working capital, and has a total stockholders' deficit. The Company
does not currently have any revenue generating operations. These conditions
raise substantial doubt about the ability of the Company to continue as a going
concern.
In view of these matters, continuation as a going concern is dependent upon
continued operations of the Company, which in turn is dependent upon the
Company's ability to, meets its financial requirements, raise additional
capital, and the success of its future operations. The financial statements do
not include any adjustments to the amount and classification of assets and
liabilities that may be necessary should the Company not continue as a going
concern.
Management plans to fund operations of the Company through advances from
existing shareholders, private placement of restricted securities or the
issuance of stock in lieu of cash for payment of services until such a time as a
business combination or other profitable investment may be achieved. There are
no written agreements in place for such funding or issuance of securities and
there can be no assurance that such will be available in the future. Management
believes that this plan provides an opportunity for the Company to continue as a
going concern.
7
3. CAPITAL STOCK
COMMON STOCK
On November 20, 2009, Daniel Wettreich sold 1,734,830 (post-merger basis) shares
of common stock to Jeffrey Rochlin. Following this transaction Mr. Rochlin now
controls 86.83% of the presently issued and outstanding common shares of the
Company. The total number of common shares authorized by the Company is
50,000,000 shares, par value $.01, of which 2,006,528 are issued and
outstanding.
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. As of January 31, 2012 and April 30, 2011, the following series of
preferred stock were authorized, issued and outstanding:
Series of Number of Shares Number of Shares
Preferred Stock Authorized Issued and Outstanding
--------------- ---------- ----------------------
A 2,000 0
B 75,000 0
C 50,000 0
D 66,134 0
E 108,056 0
F 15,000 0
G 1,000,000 0
H 5,333,333 0
I 17,000,000 0
J 10,000,000 0
K 412,000 0
L 500,000 0
---------- ----
Totals 34,561,523 0
========== ====
4. INCOME TAXES
Deferred income taxes arise from temporary timing differences in the recognition
of income and expenses for financial reporting and tax purposes. The Company's
deferred tax assets consist entirely of the benefit from net operating loss
(NOL) carryforwards. The net operating loss carryforwards, if not used, will
expire in various years through 2030, and are severely restricted as per the
Internal Revenue code due to the change in ownership. The Company's deferred tax
assets are offset by a valuation allowance due to the uncertainty of the
realization of the net operating loss carry forwards. Net operating loss
carryforwards may be further limited by other provisions of the tax laws.
The Company's deferred tax assets, valuation allowance, and change in valuation
allowance are as follows:
Estimated Change in
Estimated NOL NOL Tax Benefit Valuation Valuation Net Tax
Period Ending Carry-forward Expires From NOL Allowance Allowance Benefit
------------- ------------- ------- -------- --------- --------- -------
April 30, 2011 $ 266,298 Various $49,265 $ (49,265) $(13,445) $ --
April 30, 2010 $ 193,619 Various $ 35,820 $ (35,820) $ (8,070) $ --
April 30, 2009 $ 150,000 Various $ 27,750 $ (27,750) $ -- $ --
Income taxes at the statutory rate are reconciled to the Company's actual income
taxes as follows:
8
Income tax benefit at statutory rate resulting from
net operating loss carryforward (15.00%)
State tax (benefit) net of federal benefit (3.50%)
Deferred income tax valuation allowance 18.50%
-------
Actual tax rate --
=======
5. RELATED PARTY TRANSACTIONS
The Company's Chief Executive Officer & majority shareholder until November 20,
2009, advanced funds to pay creditors of the Company. During the year ended
April 30, 2009, a total of $99,188 was advanced and $105,287 was owed at year
end. Following the end of fiscal year 2009 and prior to the sale of his common
stock on November 20, 2009, Danny Wettreich advanced additional funds to pay
creditors of the Company. These advances were evidenced by a Demand Promissory
Note of the Company to Mr. Wettreich, which Note was sold to an outside investor
on November 20, 2009. (See note 6)
The Company uses the offices of its President for its minimal office facility
needs for no consideration. No provision for these costs has been provided since
it has been determined that they are immaterial.
Through January 31, 2012, the company's current president has advanced the
Company $65,025. The advances bear an annual interest rate of 6 percent. As of
January 31, 2012, accrued interest payable of $4,913 is owed and has no specific
repayment terms.
6. NOTE PAYABLE
The July 20, 2010 Promissory Note is in the principal amount of $117,000, bears
an annual interest rate of 6 percent, is due and payable on November 30, 2015
and is collateralized by all the assets of the Company. As of January 31, 2012
accrued interest payable of $15,379 is owed on this note.
7. MINERAL LEASE AGREEMENT
The Company entered into a mineral lease agreement with Timberwolf Minerals,
Ltd. on June 11, 2010. The cost of the initial lease payment was capitalized in
accordance with accounting standards. On June 8, 2011, the Company and
Timberwolf entered into an Amended Mineral Lease Agreement (the "Amended
Lease"). Under the terms of the Lease and the Amended Lease, the Company paid an
annual rental payment of $4,000 on the first anniversary of the Lease, June 11,
2011, and was obligated to pay to Timberwolf minimum subsequent annual rental
payments as follows: $20,000 on or before the second anniversary of the Lease,
$25,000 on or before the third anniversary of the Lease, $50,000 on or before
the fourth anniversary of the Lease and $50,000 on or before the fifth
anniversary of the Lease. The Company was able to terminate the lease by giving
Lessor a 30 day written notice. In November 2011 the Company determined it was
in its best interests to terminate the lease. Our plan of operation for the next
twelve months is to secure another property on which we will carry out a new
exploration program.
8. CHANGE OF CONTROL
On November 20, 2009, Jeffrey Rochlin entered into a Stock Purchase Agreement
with Danny Wettreich pursuant to which Mr. Wettreich sold 1,734,830 (post-merger
basis) shares of common stock of the Company, representing approximately 86.83%
of the total issued and outstanding shares of common stock of the Company, for a
total purchase price of $8,000.
Upon the closing of the purchase transaction, Mr. Rochlin acquired 1,734,830
(post-merger basis) shares of common stock, or approximately 86.83% of the
issued and outstanding Common Stock and attained voting control of the Company.
9. SUBSEQUENT EVENTS
The Company has evaluated events subsequent to January 31, 2012 to assess the
need for potential recognition or disclosure in this report. Such events were
evaluated through the date these financial statements were available to be
issued. Based upon this evaluation, it was determined that no subsequent events
occurred that require recognition or disclosure in the financial statements.
9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
FORWARD LOOKING STATEMENTS
The information in this report contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act").
These forward-looking statements involve risks and uncertainties, including
statements regarding the Company's capital needs, business strategy and
expectations. Any statements contained herein that are not statements of
historical facts may be deemed to be forward-looking statements. In some cases,
you can identify forward-looking statements by terminology such as "may,"
"will," "should," "expect," "plan," "intend," "anticipate," "believe,"
"estimate," "predict," "potential" or "continue," the negative of such terms or
other comparable terminology. Actual events or results may differ materially. In
evaluating these statements, you should consider various factors, including the
risks outlined from time to time, in other reports we file with the Securities
and Exchange Commission (the "SEC"). These factors may cause our actual results
to differ materially from any forward-looking statement. We disclaim any
obligation to publicly update these statements, or disclose any difference
between its actual results and those reflected in these statements. The
information constitutes forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995.
BUSINESS AND PLAN OF OPERATION
THE COMPANY
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 made
several acquisitions and divestments of businesses. The Company was delisted
from NASDAQ's Small Cap Market on February 26, 1998. In July 1998 all employees
of Camelot were terminated. Its directors and officers have since provided
unpaid services on a part-time basis to the Company.
On November 6, 2009, the Company's common stock was accepted for quotation,
effective November 9, 2009, on the OTC Bulletin Board ("OTCBB").
On November 24, 2009, the Company filed with the SEC a current report on Form
8-K reporting a sale of a majority of the Company's common stock from Danny
Wettreich to Jeffrey Rochlin, the resignation of Danny Wettreich as officer of
the Company and the election of Jeffrey Rochlin as President, Chief Executive
Officer, Secretary and Treasurer of the Company effective November 20, 2009.
On May 12, 2010, the sole director of the Company, Danny Wettreich, appointed
Jeffrey Rochlin as a director of the Company. Concurrent with said appointment,
Mr. Wettreich resigned as a director, with Mr. Rochlin to serve as director
until the next annual meeting of shareholders and until the election and
qualification of his successor or his earlier removal or resignation. The
Company reported Mr. Rochlin's appointment and Mr. Wettreich's resignation on a
Current Report on Form 8-K filed with the SEC on May 12, 2010.
A special meeting of shareholders of Camelot Corporation was held on Thursday,
April 28, 2011. At the special meeting, a majority of the shareholders of
Camelot Corporation approved the adoption of a proposed Agreement and Plan of
Merger, to reincorporate Camelot Corporation, a Colorado corporation ("Camelot
Nevada") in the State of Nevada by merger with and into a Nevada corporation
with the name Camelot Corporation ("Camelot Nevada") (the "Migratory Merger").
Camelot Colorado formed Camelot Nevada expressly for the purpose of the
Migratory Merger.
On May 23, 2011, FINRA affected the Migratory Merger, and the Agreement and Plan
of Merger became effective resulting in the following:
1. The adoption of the Articles of Incorporation of Camelot Nevada under the
laws of the state of Nevada as the Articles of Incorporation of the Company,
pursuant to which there are 150,000,000 shares of authorized capital stock,
consisting of 50,000,000 shares of common stock, par value $0.01 per share (the
"Camelot Nevada Common Stock"), and 100,000,000 shares of "blank check"
preferred stock, par value $0.01 per share (the "Preferred Stock"). The
Preferred Stock may be issued from time to time in one or more participating,
10
optional, or other special rights and qualifications,limitations or restrictions
thereof, as shall be stated in the resolutions adopted by Camelot Nevada's Board
of Directors providing for the issuance of such Preferred Stock or series
thereof.
2. The issued and outstanding shares of Camelot Colorado Common Stock
(49,236,106 shares) automatically converted into the right to receive shares of
Camelot Nevada Common Stock at a ratio of one (1) share of Camelot Nevada Common
Stock for each twenty-five (25) shares of Camelot Colorado Common Stock held
immediately prior to the effectiveness of the Migratory Merger, provided,
however, that holders of Camelot Colorado Common Stock who would receive at
least one share but fewer than 100 shares of Camelot Nevada Common Stock upon
conversion were rounded up so that they received 100 shares of Camelot Nevada
Common Stock (the "Conversion Ratio"). No fractional shares were issued, and
holders who would receive less than one share upon conversion did not receive
Camelot Nevada Common Stock but will receive a cash distribution of One Dollar
($1.00) upon submission of the Shareholder Transmittal Form Requesting Cash
Payment for Fractional Shares.
3. The adoption of the Bylaws of Camelot Nevada under the laws of the state of
Nevada as the Bylaws of the Company. The approval of the Migratory Merger
resulted in a total of 2,006,528 shares of common stock issued and outstanding
at May 23, 2011.
The Company entered into a mineral lease agreement with Timberwolf Minerals,
Ltd. on June 11, 2010. The cost of the initial lease payment was capitalized in
accordance with accounting standards. On June 8, 2011, the Company and
Timberwolf entered into an Amended Mineral Lease Agreement (the "Amended
Lease"). Under the terms of the Lease and the Amended Lease, the Company paid an
annual rental payment of $4,000 on the first anniversary of the Lease, June 11,
2011, and was obligated to pay to Timberwolf minimum subsequent annual rental
payments as follows: $20,000 on or before the second anniversary of the Lease,
$25,000 on or before the third anniversary of the Lease, $50,000 on or before
the fourth anniversary of the Lease and $50,000 on or before the fifth
anniversary of the Lease. The Company was able to terminate the lease by giving
Lessor a 30 day written notice. In November 2011 the Company determined it was
in its best interests to terminate the lease. Our plan of operation for the next
twelve months is to secure another property on which we will carry out a new
exploration program.
PLAN OF OPERATION
The Company's plan of operations is to secure abother property on which we will
conduct mineral exploration activities in order to assess whether the Claims
possess commercially exploitable mineral deposits. (Commercially exploitable
mineral deposits are deposits which are suitably adequate or prepared for
productive use of a natural accumulation of minerals or ores). The Company is an
exploration stage company and there is no assurance that a commercially viable
mineral deposit will exist on any Claim we may procure.
LIQUIDITY AND CAPITAL RESOURCES
Net cash used by operating activities for the nine month period ending January
31, 2012 was $29,188 compared with $22,640 in the comparable period of 2011. Net
cash used in investing activities for the nine month period ending January 31,
2012 was $0 compared with $(11,457) in the comparable period of 2011. Net cash
provided by financing activities for the nine month period ended January 31,
2012 was $15,000 compared with $35,000 provided in the comparable period of
2011. Cash of $4,586 at January 31, 2012 compares with cash of $7,317 at January
31, 2011.
The Company does not have any plans for capital expenditures other than any
potential exploration costs if we are able to procure a property to carry out an
exploration program. The Company has negligible cash resources and will
experience liquidity problems over the next twelve months due to its lack of
revenue unless it is able to raise funds from outside sources. There are no
known trends, demands, commitments or events that would result in or that are
reasonably likely to result in the Company's liquidity increasing or decreasing
in a material way.
RESULTS OF OPERATIONS
The Company's revenue for the period ended January 31, 2012 was $0 compared with
$0 in the comparable period of 2011. For the quarter ended January 31, 2012 we
incurred a net loss from operations of $3,827, and a total net loss of $21,795.
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For the comparable quarter ended January 31, 2011 we incurred a net loss from
operations of $3,956 and a total net loss of $7,409.
OFF-BALANCE SHEET ARRANGEMENTS
We do not have any off-balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that is material to investors.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not Applicable
ITEM 4. CONTROLS AND PROCEDURES
EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES
As of the end of the period covered by this Annual Report, our sole officer
performed an evaluation of the effectiveness of our disclosure controls and
procedures as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act.
Based on the evaluation and the identification of the material weaknesses in
internal control over financial reporting described below, our sole officer
concluded that, as of January 31, 2012, the Company's disclosure controls and
procedures were not effective.
MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
Management is responsible for establishing and maintaining adequate internal
control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) of
the Exchange Act. Internal control over financial reporting is a process
designed to provide reasonable assurance regarding the reliability of financial
reporting and the preparation of financial statements in accordance with GAAP.
Because of its inherent limitations, internal control over financial reporting
may not prevent or detect misstatements. Also, projection of any evaluation of
effectiveness to future periods is subject to the risk that controls may become
inadequate because of changes in conditions, or that the degree of compliance
with the policies or procedures may deteriorate.
Jeffrey Rochlin, our President, has conducted an assessment of our internal
control over financial reporting as of January 31, 2012. Management's assessment
of internal control over financial reporting was conducted using the criteria in
Internal Control over Financial Reporting - Guidance for Smaller Public
Companies issued by the Committee of Sponsoring Organizations of the Treadway
Commission ("COSO").
A material weakness is a deficiency, or a combination of deficiencies, in
internal control over financial reporting, such that there is a reasonable
possibility that a material misstatement of the Company's annual or interim
financial statements will not be prevented or detected on a timely basis. In
connection with management's assessment of our internal control over financial
reporting as required under Section 404 of the Sarbanes-Oxley Act of 2002, we
identified the following material weaknesses in our internal control over
financial reporting as of January 31, 2012:
1. The Company has not established adequate financial reporting monitoring
procedures to mitigate the risk of management override, specifically because
there are no employees and only one officer and director with management
functions and therefore there is lack of segregation of duties. In addition, the
Company does not have accounting software to prevent erroneous or unauthorized
changes to previous reporting periods. The lack of effective controls resulted
in deficient financial reporting which was corrected in the audit process.
2. In addition, there is insufficient oversight of accounting principles
implementation and insufficient oversight of external audit functions.
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3. There is a strong reliance on the external attorneys to review and edit
the annual and quarterly filings and to ensure compliance with SEC disclosure
requirements.
Because of the material weaknesses noted above, management has concluded that we
did not maintain effective internal control over financial reporting as of
January 31, 2012, based on Internal Control over Financial Reporting - Guidance
for Smaller Public Companies issued by COSO.
REMEDIATION OF MATERIAL WEAKNESSES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
As a small business, without a viable business and revenues, the Company does
not have the resources to install a dedicated staff with deep expertise in all
facets of SEC disclosure and GAAP compliance. As is the case with many small
businesses, the Company will continue to work with its external consultants as
it relates to new accounting principles and changes to SEC disclosure
requirements. The Company has found this approach worked well in the past and
believes it to be the most cost effective solution available for the foreseeable
future.
The Company will conduct a review of existing sign-off and review procedures as
well as document control protocols for critical accounting spreadsheets. The
Company will also increase management's review of key financial documents and
records.
As a small business, the Company does not have the resources to fund sufficient
staff to ensure a complete segregation of responsibilities within the accounting
function. However, Company management does review, and will increase the review
of, financial statements on a monthly basis. These actions, in addition to the
improvements identified above, will minimize any risk of a potential material
misstatement occurring.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
There were no significant changes in our internal control over financial
reporting during the quarter ended January 31, 2012, that have materially
affected, or are reasonably likely to materially affect, our internal control
over financial reporting.
PART II
OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We know of no material, active or pending legal proceedings against the Company,
nor are we involved as a plaintiff in any material proceeding or pending
litigation. There are no proceedings in which any of our directors, officers or
affiliates, or any registered or beneficial shareholder, is an adverse party or
has a material interest adverse to our interest.
ITEM 1A. RISKS FACTORS
Not applicable
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Not applicable
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
Not applicable
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ITEM 4. REMOVED AND RESERVED
ITEM 5. OTHER INFORMATION
a). None
b). None
ITEM 6. EXHIBITS
Exhibits required by Item 601 of Regulation S-K:
Exhibit No. Description
----------- -----------
3.1 Certificate of Incorporation(1)
3.2 Amended Certificate of Incorporation(1)
3.3 Articles of Incorporation - Nevada(2)
3.4 By-Laws(2)
4.1 Specimen common stock certificate(1)
10.1 Mineral Lease Agreement dated June 11, 2010 between Camelot
Corporation and Timberwolf Minerals, Ltd.(3)
10.2 Amendment to Mineral Lease Agreement dated June 8, 2011 between
Camelot Corporation and Timberwolf Minerals, Ltd.(2)
16.1 Letter from Comiskey & Co., P.C. dated June 9, 2010(4)
31 Certification of Principal Executive Officer and Principal
Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
32 Certification of Principal Executive Officer and Principal
Financial Officer to 18 U.S.C. Section 1350, as Adopted Pursuant
to Section 906 of the Sarbanes-Oxley Act of 2002
99.1 Blair Junction Summary Report of Timberwolf Minerals Ltd.(3)
99.2 Blair Junction Summary and Recommendations of Timberwolf Minerals
Ltd.(3)
101 Interactive data files pursuant to Rule 405 of Regulation S-T
----------
1. Incorporated herein by reference from the Company's Registration Statement
on Form 10 filed with the Securities and Exchange Commission on June 23,
1976.
2. Incorporated herein by reference from the Company's Current Report on Form
8-K filed with the Securities and Exchange Commission on June 13, 2011.
3. Incorporated herein by reference from the Company's Current Report on Form
8-K filed with the Securities and Exchange Commission on July 26, 2010.
4. Incorporated herein by reference from the Company's Current Report on Form
8-K filed with the Securities and Exchange Commission on June 14, 2010.
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SIGNATURE
In accordance with Section 13 or 15(d) of the Securities Exchange Act, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
Date: March 16, 2011 CAMELOT CORPORATION
By: /s/ Jeffrey Rochlin
-----------------------------------------
Jeffrey Rochlin
Principal Executive Officer
Principal Financial Officer and Director
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