UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM 10-K

[X]      ANNUAL  REPORT  PURSUANT  TO  SECTION  13 OR  15(d)  OF THE  SECURITIES
         EXCHANGE ACT OF 1934

                     For the fiscal year ended June 30, 2005
                                               -------------

                                       OR

[_]      TRANSITION  REPORT  PURSUANT  TO SECTION 13 OR 15(d) OF THE  SECURITIES
         EXCHANGE ACT OF 1934

    For the transition period from _______________ to ______________________

                         Commission file number 0-27494

                            SILVERSTAR HOLDINGS, LTD.
             (Exact name of Registrant as specified in its charter)

               Bermuda                                     N/A
               -------                                     ---
  (State or other jurisdiction of           (I.R.S. Employer Identification No.)
   incorporation or organization)

             Clarendon House, Church Street, Hamilton HM CX, Bermuda
             -------------------------------------------------------
             (Address of Principal Executive Offices with Zip Code)

        Registrant's telephone number, including area code (441) 295-1422
                                                           --------------

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

 Title of each class                 Name of each exchange on which registered
 -------------------                 -----------------------------------------
        None                                           None

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

                          Common Stock, $0.01 par value
                          -----------------------------
                                ("Common Stock")

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.  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 Registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by reference in Part III of this Form 10-K or any amendment to the
Form 10-K. [ ]

Indicate  by check mark  whether  the  Registrant  is an  accelerated  filer (as
defined in Exchange Act Rule 12b-2) Yes ___  No  X
                                                ---

State the aggregate market value of the voting and non-voting common equity held
by  non-affiliates  computed  by  reference  to the price at which the stock was
sold, or the average bid and asked prices of such common equity,  as of the last
business day of the Registrant's most recently completed second fiscal quarter.

The  aggregate   market  value  of  the   Registrant's   Common  Stock  held  by
non-affiliates of the Registrant as of September 16, 2005, was $11,855,541.

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

As of September 16, 2005, there were 8,246,747 shares of the Registrant's Common
Stock  outstanding and 814,786 shares of the  Registrant's  Class B Common Stock
outstanding.
<PAGE>

                                    PART I.

ITEM 1.  BUSINESS

OVERVIEW

We are a holding company that seeks to acquire  businesses  fitting a predefined
investment strategy.

We  are  the  parent  company  of  Fantasy  Sports,  Inc.,  which  operates  the
Fantasycup.com  website,  and specializes in subscription based NASCAR,  college
football and  basketball and other fantasy sports games and Strategy First Inc.,
a leading  developer and worldwide  publisher of entertainment  software for the
Personal Computer (PC). We are also a minority shareholder in Magnolia Broadband
Wireless,  a  development  stage company  which is  developing  mobile  wireless
broadband products.

HISTORY

We  were  founded  in  September  1995  as  a  Bermuda   corporation  to  pursue
opportunities  in South Africa.  At that time, our business plan was to acquire,
own and operate  seasoned,  closely  held  companies in South Africa with annual
sales in the range of  approximately  $5 million  to $50  million.  In 1999,  we
shifted our focus to the Internet,  technology and e-commerce sectors,  and away
from South  Africa,  by  acquiring  a majority  stake in  Leisureplanet.com,  an
Internet travel services  company.  In connection with the shift in our business
plan, we changed our name to Leisureplanet  Holdings,  Ltd. In 2000, we disposed
of our operations in South Africa, closed Leisureplanet.com and acquired 100% of
Fantasy Sports,  Inc. In 2001, we acquired 100% of Student Sports, Inc, which we
sold in 2003. This was the only operating  subsidiary in our marketing  services
segment.  As a result of these changes and developments,  we have  reestablished
our investment criteria. Currently, our strategy focuses on the following:

o    Acquiring  controlling  stakes  in high  quality  game  related  media  and
     marketing  businesses with strong  management  teams that are positioned to
     use technology and Internet related platforms to fuel above average growth.

o    Our investments must show an ability to contribute,  in the short to medium
     term,   to  earnings  per  share  through   operating   profit  or  capital
     appreciation.

o    We aim to add value to our  investments  by operating in  partnership  with
     committed, incentivised, entrepreneurial management who show the vision and
     ability to grow their businesses into industry or niche leaders.

DESCRIPTION OF OUR SUBSIDIARIES AND INVESTMENTS

STRATEGY FIRST, INC.

In April  2005,  we  acquired  Strategy  First Inc.  (www.strategyfirst.com),  a
leading  developer and  worldwide  publisher of  entertainment  software for the
Personal Computer (PC).  Founded in 1990, the company  publishes  software games
primarily for the PC platform,  including O.R.B, the Disciples franchise, Sacred
Lands, Kohan: Immortal Sovereigns, Steel Beasts, Galactic Civilizations, and the
Jagged  Alliance  franchise.  Our  products  are sold on CD's and more  recently
online, over the Internet and meet the needs of serious gamers who are seeking a
more intense strategy based game experience.  In North America, our PC games are
distributed primarily through third-party software distributors, who service the
mass-merchants  and major retailers.  In territories  outside North America,  we
license our PC games to third-party software  distributors,  who are responsible
for the manufacturer  and  distribution of


                                      -1-
<PAGE>

our PC games, in specific  geographic  territories.  Our products sell at retail
prices of $19.99-$49.99, depending on the quality of the particular game.

We acquired the company  through the  jurisdiction  of the  Montreal  bankruptcy
court.  As per the  approved  plan of  arrangement,  we  paid  consideration  to
creditors of  approximately  $600,000 in cash; we issued  approximately  400,000
shares of Common  Stock;  warrants to purchase  200,000  shares of Common Stock;
assumed  approximately  $400,000 in existing  bank debt,  as well as  contingent
consideration based on the future profitability of Strategy First.

Strategy  First had previously  encountered  financial  difficulties  due to its
policy of developing its games  in-house,  which required  significant  overhead
expenses  both in terms of payroll  and other  development  costs.  Prior to our
acquisition, management had shifted their strategy to become a publisher selling
other developer's  games. This has significantly  lowered the company's expenses
and its breakeven threshold.  We intend to continue to operate this company as a
publisher and have no current plans to re-enter the development business.

The worldwide  consumer  entertainment  software market is very competitive.  We
compete with other  companies  having  operations that vary from small companies
with limited resources to large companies with greater resources than we have.

The changing  characteristics of the worldwide consumer  entertainment  software
market in recent years has been impacted by many factors, such as: an increasing
number of  technologically  advanced PCs with more powerful  operating  systems,
enhanced  graphics and video cards,  expanded  memory  chips,  as well as higher
capacities  and  faster  speeds for CD and hard  drives in the home and  office;
greater  access by  consumers to the Internet  through  high-speed  access modes
(such as cable modems and DSL  connections);  increased  interest in online game
play;  the  increasing  number of game  console  devices  in the  home;  and the
development of increasingly advanced technologies  supporting game play (such as
hand held game devices,  mobile phones and personal  digital  assistants).  As a
result of this  increased  competition  in the  overall  consumer  entertainment
market,  market data  suggests  that the retail  market for PC game software has
decreased  over the past two years.  This trend is  particularly  pronounced  in
North America.

Furthermore,  the North American PC software game market, has gravitated towards
mass merchant  retailers thereby  increasing the competition for shelf space for
PC games. This increased competition has emphasized the importance of marketing,
merchandising and brand name recognition.  A significant  result of these market
pressures   is  an  industry   trend  toward  the   consolidation   of  consumer
entertainment  PC  software  publishers  and  distributors,  in  addition to the
diversification  of  products  offered by these  companies.  The  trends  toward
industry  consolidation  and increased  competition  for game content and retail
shelf space are more pronounced in North America than in  international  markets
and are expected to continue for the foreseeable future.

We intend to continue operating as a low cost publisher of niche PC based games.
We will work to  strengthen  our  overall  retail  North  American  distribution
through a combination  of alliances  with more  established  distributors  and a
strong in house  sales  effort.  We will  endeavor  to broaden  the range of our
titles beyond the Strategy/Role playing category and improve the overall quality
of our titles.  We will strive to increase our  international  presence  through
distribution  alliances,  thereby taking  advantage of the  relatively  stronger
international  PC game market.  We have launched an online store where games are
sold to consumers in both boxed and direct download formats.  We intend to build
on this online  initiative  to lessen our reliance on the retail  sales  channel
particularly in North America.

                                      -2-
<PAGE>

FANTASY SPORTS, INC.

Fantasy  Sports,  Inc.  owns and operates  one of  America's  oldest and largest
subscription  based NASCAR  fantasy sports games.  In addition,  the company has
developed,  and offers,  subscription  based college football,  basketball,  and
other  motor sport  fantasy  games.  All the  company's  games offer  weekly and
seasonal cash and merchandise prizes.

Currently,  the Company has over 30,000 paid game plays for its Spring, Fall and
One  Race  NASCAR  challenges,  as  well as the  fantasy  college  football  and
basketball  challenges and our other games.  Subscription revenues for our games
and ancillary  services  account for over 99% of our total revenues.  Our NASCAR
games currently generate over 88% of our subscription revenues. Participants pay
between  $9.95  to  $169.95  to play  in our  seasonal  games,  and a $25 fee to
participate in our One Race and Tournament challenges. We offer two grand prizes
of $25,000 each for our NASCAR  challenges  and a $10,000  prize for the college
football challenge winner. The winners of our One Race and Tournament challenges
receive  $10,000.  In  addition,  weekly  prizes  and bonus  points  are  widely
distributed.

Fantasy  sports  participation  is rapidly  becoming a significant  component of
sports related leisure time activity. The NASCAR niche is particularly appealing
as growing public  interest in the sport,  as evidenced by increased  attendance
and TV ratings for all NASCAR events,  particularly the Nextel Cup Series races,
have made this one of America's  most popular  sports.  Fantasy  Sports has been
operating their NASCAR challenges since 1993 and is one of the leading companies
in this  market.  Our  websites  offer up to the  minute  racing  tips from Mark
Garrow,  the  well-known  broadcaster,  which adds to the fun and  excitement of
playing  the game.  Contestants  can visit the site and trade  drivers up to the
very  last  minute  prior to a race,  thereby  offering  the  highest  degree of
interactive online participation.

Since 1997, Fantasy Sports has operated a full season college football challenge
game,  which accounted for  approximately  8% of our  subscription  revenues for
fiscal 2005.  During 2001, we developed and  distributed a tournament  challenge
college  basketball game that generated over 1,600 paying  customers in our last
fiscal year.  We developed a retail  business  that  specialized  in the sale of
NASCAR  related  die-cast  cars,  apparel  and other  merchandise.  This  retail
operation  commenced  business in May 2001 and accounted for approximately 7% of
our overall  revenues in fiscal 2004. Due to ongoing losses,  this operation was
closed during the second quarter of fiscal 2004.

We have substantially reduced our overhead in order to maximize profitability at
Fantasy  Sports.  This was  primarily  achieved by the  reduction  of  marketing
expenses and general and administrative  overhead through the outsourcing of our
hosting, programming and customer service functions to Stats, Inc.

Due to the  increased  popularity  of  online  Fantasy  Sports,  we  have  faced
increased  competition  over the past few years from both large media companies,
such as, ESPN.com,  CBS Sportsline,  FoxSports.com,  and Nascar.com,  as well as
from numerous small companies such as, Fanball.com,  CDM Sports,  All-Star Stats
and Sportsbuff.

There has been increasing  governmental  scrutiny of online gambling operations,
however,  to the best of our knowledge,  the online fantasy sports  business has
not been included in this category. Fantasy Sports games have traditionally been
differentiated  from gambling due to the element of skill  involved,  as well as
the ability of participants  to play through the US mail,  without paying a fee.
Although  we have  received  legal  comfort  in  this  regard,  there  can be no
guarantee  that  governmental  regulations  may not  change or be applied to our
business, in the future.

                                      -3-
<PAGE>

MAGNOLIA BROADBAND WIRELESS

On April 14, 2000, we entered into a Securities Purchase Agreement with Magnolia
Broadband,  Inc.  Magnolia  is a start up company  that is  developing  wireless
broadband  solutions  for  the  mobile   telecommunications   industry.   Mobile
telecommunications  has been and continues to be one of the fastest  growing and
most dynamic segments of the  telecommunications  industry.  According to recent
industry  statistics,  semiconductor  revenue for wireless handsets exceeded $50
billion in 2004, driven by sales volume of over 1.2 billion handsets that year.

Magnolia  is  developing  technology  to become  one of the first  companies  to
integrate  smart  antenna  technologies  into  Radio  Frequency  (RF)  chip sets
utilized in mobile  phones.  Their aim is to create chip sets that  increase the
capacity and coverage of existing networks at little additional cost

Magnolia is a fabless  semiconductor  company building RF solutions by combining
innovative Signal Processing technologies and novel Integrated Circuit solutions
for the cellular  industry.  The  combination of these  innovations  enables the
wireless network operators to push out the Diversity Antenna capabilities to the
edge of their networks,  while enabling the handset manufacturers to offer these
benefits economically.

We initially  invested  $2,500,000 in Magnolia and received  shares of preferred
stock in Magnolia. We also received board representation rights and registration
rights.  In  October  2001,  we  invested  an  additional  $450,000  of a  total
$1,500,000 offering of Magnolia's Series A Preferred Stock. We co-invested along
with Selway Partners,  LLC, and CIP Capital,  LP. In April and May 2002 Magnolia
raised a further  $7.5  million in an offering of Series B Preferred  Stock.  In
June 2003 Magnolia  raised a further $6 million dollars in an offering of Series
C Preferred  Stock.  In April 2004,  Magnolia  raised a further $3 million in an
offering of convertible notes. In November 2004, Magnolia raised a further $13.5
million in an offering of  preferred  stock.  We did not  participate  in any of
these rounds.  Currently we own  approximately 3% of Magnolia on a fully diluted
basis  including the exercise of all employee  stock  options.  Due to recurring
losses,  our investment in Magnolia at June 30, 2005, which is now accounted for
under the lower of cost or market method, was $831,066.

DISCONTINUED OPERATIONS

Student Sports, Inc.

On June 10, 2003, we entered into an Asset Purchase  Agreement with SS Founders,
Inc.,  pursuant to which we sold substantially all of the assets and liabilities
of Student Sports,  Inc.  Student Sports offers unique access to the high school
athletic  market  across  multimedia  platforms.  As a subsidiary  of Silverstar
Holdings,  the company's primary thrust was to offer marketing services to large
corporations  interested  in accessing  this market.  Additionally,  the company
worked towards building a "bottom-up"  revenue generation  strategy based on the
creation of a number of subscription  based programs where products and services
will be sold directly to the high school athletes, their parents and coaches. We
originally  acquired Student Sports in September 2001. The consideration for the
sale of Student  Sports was 325,686 shares of Silverstar  Holdings  common stock
that were  returned  to the Company as well as the  forgiveness  of a maximum of
913,745 contingent shares of Silverstar Holdings that could have been payable to
former Student Sports shareholders in April 2004.

EMPLOYEES

As of September 16, 2005, we employed 19 employees through our subsidiaries,  of
which 18 were full time salaried and one was an hourly employee.

                                      -4-
<PAGE>

We provide  performance based and equity based  compensation  programs to reward
and motivate significant contributors among our employees.  Although none of our
employees is  represented  by a labor union,  we have not  experienced  any work
stoppages and consider our relations with our employees to be good.

ITEM 2.  PROPERTIES

Our principal  executive offices are located at Clarendon House,  Church Street,
Hamilton,  HM CX,  Bermuda,  which space is made  available  to us pursuant to a
corporate  services  agreement entered into with a corporate services company in
Bermuda.

Fantasy  Sports,  Inc. leases an office at 867 Clare Lane,  York,  Pennsylvania,
17402. The office occupies  approximately  980 square feet. The lease expires on
December 31, 2005. It is renewable  annually and costs us  approximately  $9,000
per year.

Strategy First, Inc. leases an office at 147 St-Paul West, Suite 210,  Montreal,
Quebec Canada.  The office occupies  approximately  3,800 square feet. The lease
expires on November 30, 2006, and costs us approximately $56,000 per year.

Our United States management subsidiary,  First South Africa Management Corp., a
Delaware corporation incorporated in 1995, leases an office at 6100 Glades Road,
Suite 305,  Boca Raton,  Florida  33434.  The lease expires in February 2006 and
costs us approximately $33,000 per year for approximately 1,200 square feet.

ITEM 3.  LEGAL PROCEEDINGS

None.

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

None.


                                      -5-
<PAGE>

                                    PART II.

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         Our common stock is listed for quotation on the National  Market on the
Nasdaq  System under the symbol SSTR.  The following  table sets forth,  for the
periods indicated the high and low closing sales prices for our common stock, as
reported by Nasdaq.

--------------------------------------------------------------------------------
                                                     High             Low
--------------------------------------------------------------------------------

Common Stock Fiscal 2004
1st Quarter........................................  $1.48            $0.44
2nd Quarter........................................  $2.49            $1.08
3rd Quarter........................................  $2.09            $1.17
4th Quarter........................................  $1.54            $0.88

Common Stock Fiscal 2005
1st Quarter........................................  $0.97            $0.60
2nd Quarter........................................  $1.16            $0.82
3rd Quarter........................................  $1.34            $1.06
4th Quarter........................................  $1.80            $1.12


The closing price of our common stock on September 16, 2005 was $1.57.

As of September 16, 2005, there were  approximately  2,400 holders of our common
stock,  inclusive  of  holders  whose  shares  were  held  by  brokerage  firms,
depositaries and other institutional firms in "street name" for their customers.

We have never  declared or paid any cash  dividends  on our common  stock or our
Class B common stock. We do not anticipate  declaring or paying any dividends on
our  common  stock or our Class B common  stock in the  foreseeable  future.  We
currently intend to retain future earnings,  if any, to finance the expansion of
our business.


                                      -6-
<PAGE>

EQUITY COMPENSATION PLAN INFORMATION

The following  table  contains a summary of the number of shares of Common Stock
of the Company to be issued upon the  exercise of options,  warrants  and rights
outstanding  at June 30, 2005,  the  weighted  average  exercise  price of those
outstanding options, warrants and rights, and the number of additional shares of
Common Stock remaining  available for future issuance under the plans as at June
30, 2005.

<TABLE>
<CAPTION>
                                                 EQUITY COMPENSATION PLAN INFORMATION

------------------------------- ---------------------------- ---------------------------- ----------------------------
Plan Category                   Number of securities to be    Weighted average exercise      Number of securities
                                  issued upon exercise of       price of outstanding
                                   outstanding options,         options, warrants and       remaining available for
                                    warrants and rights                rights                  further issuance
------------------------------- ---------------------------- ---------------------------- ----------------------------
<S>                             <C>                          <C>                          <C>
Equity compensation plans
approved by shareholders*                 575,000                      $ 1.20                       25,000
------------------------------- ---------------------------- ---------------------------- ----------------------------
Equity compensation plan not
approved by shareholders                    NA                           NA                           NA
------------------------------- ---------------------------- ---------------------------- ----------------------------
Stock options issued to
directors and employees**                 970,000                      $ 3.26                         NA
------------------------------- ---------------------------- ---------------------------- ----------------------------
Warrants issued in connection
with services to be                       180,000                      $ 0.81                         NA
provided***
------------------------------- ---------------------------- ---------------------------- ----------------------------
Warrants issued in connection
with raising capital ****                 202,189                      $ 6.00                         NA
------------------------------- ---------------------------- ---------------------------- ----------------------------
Warrants issued for
acquisition of Strategy                   200,000                      $ 2.50                         NA
First, Inc. *****
------------------------------- ---------------------------- ---------------------------- ----------------------------
</TABLE>

*     See Note 14 to the Financial Statements

**    These options were granted pursuant to various employment agreements

***   These  warrants were granted to a consultant  for services to be rendered.
      These warrants expire July 1, 2007.

****  These warrants were issued in connection with raising capital during 2000.
      These warrants expire July 31, 2007.

***** These warrants were issued in connection  with the acquisition of Strategy
      First, Inc. These warrants expire April 21, 2008.

                                      -7-
<PAGE>

ITEM 6...SELECTED FINANCIAL DATA

Selected Consolidated Financial Information

<TABLE>
<CAPTION>
STATEMENT OF OPERATIONS DATA                                               YEARS ENDED JUNE 30,
                                                ---------------------------------------------------------------------------
                                                    2001            2002           2003             2004           2005
                                                -----------     -----------     -----------     -----------     -----------
<S>                                             <C>             <C>             <C>             <C>             <C>
Revenues                                        $ 1,301,432     $ 3,107,324     $ 3,141,448     $ 2,367,463     $ 2,299,254
Total operating expenses                          4,362,413       5,295,375       4,456,082       3,239,802       2,943,367
Operating loss                                   (3,060,981)     (2,188,051)     (1,314,162)       (872,339)       (644,113)
Interest income, net                                976,107         615,294         638,011         603,352         563,135
Foreign currency gain (loss)                     (1,042,474)     (1,345,348)      1,763,115       1,287,291          81,773
Income (loss) from continuing operations
before
     Income taxes                                (5,010,726)     (2,964,039)      1,069,049       1,030,105         158,838
Net income (loss) from continuing operations     (5,010,726)     (2,964,039)      1,069,049       1,030,105         158,838
Loss from discontinued operations                         -        (824,761)       (736,947)              -               -
Loss on disposition                              (2,389,383)              -        (262,754)        (27,582)              -
Extraordinary item - gain on extinguishments
of debt                                           2,142,949               -               -               -               -
Net (loss)/income                                (5,257,160)     (3,788,800)         69,348       1,002,523         158,838
Income (loss) per share  - from continuing
     operations                                 $     (0.57)    $     (0.34)    $      0.12     $      0.12     $      0.02

BALANCE SHEET DATA                                                            AS OF JUNE 30,
                                                        2001           2002            2003           2004           2005

Total assets                                    $ 15,931,857    $ 11,722,781    $ 12,354,162    $ 13,265,458     $ 14,700,465
Long term liabilities                                      -               -         349,289         234,192          423,601
Net working capital  (deficiency) (1)              4,253,001       2,345,828         192,081        (177,981)       3,637,934
Stockholders' equity                              13,578,710      10,212,073      10,025,049      11,422,107       12,288,518

</TABLE>

(1)   Net working capital  (deficiency) is the net of current assets and current
      liabilities.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS

BACKGROUND AND HISTORY

The following discussion and analysis of our operations,  cash flows,  liquidity
and  capital  resources  should  be read in  conjunction  with our  consolidated
financial statements contained in this report.

Silverstar  Holdings,  Ltd. was  incorporated  in September  1995. The Company's
intention is to actively pursue  acquisitions  fitting a pre defined  investment
strategy. Currently our strategy focuses on the following:

o    Acquiring controlling stakes in small, high quality, game related media and
     marketing  businesses with strong  management  teams that are positioned to
     use technology and Internet related platforms to fuel above average growth.

o    Our investments must show an ability to contribute,  in the short to medium
     term,   to  earnings  per  share  through   operating   profit  or  capital
     appreciation.

                                      -8-
<PAGE>

o    We aim to add value to our  investments  by operating in  partnership  with
     committed,  entrepreneurial  management  who show the vision and ability to
     grow their businesses into industry or niche leaders.

We sold our last remaining  South African  operations in November 2000. We still
have  significant  assets that are denominated in South African Rand. The assets
include  cash and notes  receivable.  Although we  purchased a twelve month Rand
Put/US  dollar  call  option  that  serves as a partial  protection  against the
depreciation  of the SA Rand  against  the US  dollar,  should we hold the notes
until  maturity we will continue to record income  statement  gains or losses to
the extent that the Rand's value  fluctuates  relative to the US dollar.  At the
present time, management has no intention of disposing of the notes receivable.

On November 17, 2000, we acquired all of the assets and certain  liabilities  of
Fantasy Sports  (Fantasy) from GoRacing  Interactive  Services,  Inc. Founded in
1993,  Fantasy Sports  operates the  fantasycup.com,  website and specializes in
subscription based NASCAR, college football and other fantasy sports games.

On September  24,  2001,  a newly  created  subsidiary  of the Company,  Student
Sports,  Inc.,  acquired  all  the  assets  and  business  and  assumed  certain
liabilities  of  Student  Sports,  a  media  company,   producing  publications,
television programs and various marketing initiatives for the high school sports
market.  On June 10, 2003, the Company disposed of substantially  all the assets
and  liabilities of Student Sports,  which was the only operating  subsidiary in
the marketing services segment of the Company.

In accordance with accounting principles generally accepted in the United States
of America the operating  results and net assets  related to Student Sports have
been  included  in  discontinued   operations  in  the  company's   consolidated
statements  of  operations  and   consolidated   balance  sheets.   Discontinued
operations  for the fiscal  years  ending  June 30,  2003,  represent  operating
results for eleven  months.  Net assets of $0.05 million and net  liabilities of
$0.06 million were assumed by the parent company.

The discontinued operations generated sales of $1.26 million and net losses from
operations of $0.74 million for the year ended June 30, 2003.

On April 21, 2005, we acquired  Strategy First Inc.  (www.strategyfirst.com),  a
leading developer and worldwide publisher of entertainment  software for the PC.
We acquired the company  through the  jurisdiction  of the  Montreal  bankruptcy
court.  Pursuant to the approved plan of arrangement,  we paid  consideration to
the creditors of $609,000 in cash; we issued 377,000 shares of our common stock;
warrants  to  purchase   200,000  shares  of  our  common  stock;   and  assumed
approximately   $400,000  in  existing   bank  debt,   as  well  as   contingent
consideration  based on the future  profitability of Strategy First.  Founded in
1990, the company publishes  software games primarily for the PC platform.  Some
of our popular  games include  O.R.B,  the  Disciples  franchise,  Sacred Lands,
Kohan: Immortal Sovereigns, Steel Beasts, Galactic Civilizations, and the Jagged
Alliance  franchise.  Two months of operating  results for  Strategy  Firsts are
included in fiscal 2005.

RESULTS OF OPERATIONS

FISCAL 2005 COMPARED TO FISCAL 2004

Revenues

Revenues  were $2.30  million in fiscal 2005 as compared to $2.37 million in the
prior year.  Revenues for Fantasy  Sports'  decreased by $0.42 million which was
offset by Strategy First revenues of $0.35 million.  Fantasy Sports' decision to
stop  selling  merchandise  and apparel in  December  2003  accounted  for $0.17
million of this  decrease.  The  remainder of the decrease was caused by Fantasy
Sports' decision to focus on operating profitable games as well as a decrease in
the number of subscribers.

                                      -9-
<PAGE>

Cost of Sales
Cost of sales  decreased  $0.27  million  to $1.14  million  in  fiscal  2005 as
compared to $1.41  million in the prior year.  Cost of Sales for Fantasy  Sports
decreased  $0.39  million  primarily  due to  decreases  in the  cost of  prizes
awarded,  fulfillment  expenses,  direct labor costs and the cost of merchandise
and  apparel  sold.  The  decreases  were  offset  by the cost of sales of $0.12
million for Strategy First.

Selling, General and Administrative Expenses
Selling,  general and administrative expenses for fiscal 2005 were $1.76 million
as compared to $1.78  million in fiscal 2004,  a decrease of $0.02  million over
the prior year.  Fantasy Sports decreased selling,  general,  and administrative
expenses  by  $0.36  million  by the  implementation  of cost  cutting  measures
primarily to payroll and related costs.  This decrease was offset by increase in
expenses  at the  corporate  level of $0.13  million  and  expenses  incurred by
Strategy First of $0.21 million.

Amortization and Depreciation
Amortization  of  intangible  assets was $0.02  million in fiscal 2005 and 2004.
Amortization  expense for Fantasy Sports  decreased  $0.02 million as one of two
customer  lists became  fully  amortized  at  September  30, 2004.  Amortization
expenses  incurred  by  Strategy  First for game  titles and a  covenant  not to
compete offset this decrease.  Depreciation  expense was $0.02 million in fiscal
2005 as compared to $0.04 million in fiscal 2004.

Foreign Currency Gains
Foreign  currency gains are almost  exclusively  related to the assets remaining
from the sale of discontinued  South African  operations.  The foreign  currency
gains  during  fiscal  2005 were  $0.08  million as  compared  to gains of $1.29
million in fiscal 2004.  These gains are the result of the  fluctuations  of the
South  African Rand against the US dollar.  During the year ended June 30, 2005,
the  Rand  depreciated   approximately  7%  against  the  US  dollar,  while  it
appreciated  17% in Fiscal  2004.  In 2005,  the increase in the market value of
Rand put/US  dollar call option  partially  offset the foreign  currency  losses
which resulted in an overall gain for the year. These foreign currency gains are
non cash items until  converted  into US dollars when any  accumulated  gains or
losses will be converted  into cash.  During the year ended June 30,  2005,  the
Company  received  approximately  R31 million  (South  African  Rand) as partial
payment of notes owed by Salwin Pty, Ltd. As a result the Company realized gains
on this repayment amount when it was converted into US dollars.

Interest Income
Interest  income of $0.59 million was recorded during fiscal 2005 as compared to
interest  income of $0.63 million in fiscal 2004.  Interest  income is primarily
earned  on  Notes  Receivable  from the sale of the  Lifestyle  business  and is
affected by the  fluctuation  of the South African Rand against the US dollar as
well as movements in SA prime interest rates.

Interest Expense
Interest  expense  during  fiscal  2005 was $0.02  million as  compared to $0.03
million in the prior year.  This decrease is attributable  the lower  short-term
credit lines held by Fantasy Sports, Inc. during fiscal 2005.

Provision for Income Taxes
The Company is registered in Bermuda,  where no income tax laws are  applicable.
Three of the Company's  subsidiaries are subject to U.S. income taxes and one is
subject to Canadian  income taxes Up to this date,  none of them has had taxable
income.  They have  incurred  losses for tax  purposes.  The  deferred tax asset
generated by the tax losses and temporary differences has been fully reserved.

                                      -10-
<PAGE>

Discontinued Operations
During  fiscal 2004 the Company  recognized  losses of $0.03  million on assets
formerly used by Student  Sports that were  retained by the parent  company when
Student Sports was sold in 2003.

Net Income
The Company has  recognized  income of $0.16 million during fiscal 2005 compared
to income of $1.00  million  during the prior year.  The current  year  includes
non-cash foreign currency gains of  approximately  $0.08 million.  During fiscal
2004 net income included non-cash foreign currency gains of $1.29 million due to
the   appreciation   of  the  South  African  Rand  against  the  US  dollar  of
approximately  17%.  Operating  losses  for fiscal  2005 were  $0.64  million as
compared to $0.87 million in Fiscal 2004.  The decrease in operating  losses was
primarily the result of Fantasy Sports'  increase in operating income from $0.07
million in fiscal 2004 to $0.44 million in Fiscal 2005.

FISCAL 2004 COMPARED TO FISCAL 2003

Revenues
Revenues  were $2.37  million in fiscal 2004 as compared to $3.14 million in the
prior year. The decrease was primarily the result of Fantasy Sports  decision to
discontinue  selling die-cast  collectibles and apparel during the quarter ended
December 31, 2003.  Sales of merchandise  decreased from $0.81 million in fiscal
2003 to $0.17 million in fiscal 2004.

Cost of Sales
Cost of sales were $1.41  million in fiscal 2004 as compared to $2.01 million in
the prior year.  The  decrease is primarily a result of decreases in the cost of
prizes  awarded,  fulfillment  expenses,  direct  labor  costs and the volume of
merchandise and apparel sold.

Selling, General and Administrative Expenses
Selling, general and administrative expenses for fiscal 2004 were $1.78 million,
a  decrease  of $0.54  million  over the same  period  in the prior  year.  This
decrease was caused by the  implementation of cost cutting measures primarily to
payroll and related costs at the corporate and operating levels.

Amortization and Depreciation
Amortization of intangible assets decreased to $0.02 million in fiscal 2004 from
$0.07  million  as a result of a  customer  list  becoming  fully  amortized  at
September  30, 2003.  Depreciation  expense was $0.04  million in fiscal 2004 as
compared to $0.07 million in fiscal 2003.

Foreign Currency Gains
Foreign  currency gains or losses are related to the financial  assets remaining
in the South African  operations.  The Foreign currency gains during fiscal 2004
were $1.29 million as compared to gains of $1.76  million in fiscal 2003.  These
gains are the result of  fluctuations  of the South  African Rand against the US
dollar.  During the year ended June 30, 2004 the Rand appreciated  approximately
17% against the U.S.  dollar while it  appreciated  26% in 2003.  These  foreign
currency  gains or losses are non-cash  items until  converted  into US dollars,
when any accumulated gains or losses will be converted to cash.

Interest Income
Interest  income of $0.63 million was recorded during fiscal 2004 as compared to
interest income of $0.65 million.  Interest income is primarily  earned on Notes
Receivable  from the  sale of the  Lifestyle  business  and is  affected  by the
fluctuation of the South African Rand against the US dollar, as well as movement
in SA prime interest rates.

                                      -11-
<PAGE>

Interest Expense
Interest  expense  during  fiscal 2004 was $0.025  million as compared to $0.012
million in the prior year. The increase in interest  expense is  attributable to
interest  charges  incurred on short-term  credit lines held by Fantasy  Sports,
Inc.

Provision for Income Taxes
The Company is registered in Bermuda,  where no income tax laws are  applicable.
Three of the  Company's  subsidiaries  are subject to income  taxes.  Up to this
date,  none of them has had taxable  income.  They have incurred  losses for tax
purposes.  The  deferred  tax asset  generated  by the tax losses and  temporary
differences has been fully reserved.

Discontinued Operations
Student  Sports was sold in June 2003.  The results for this  business  for both
2003 and 2002 have been included under Discontinued  Operations in our financial
statements.  During fiscal 2004 the company  recognized losses of $0.027 million
on assets  formerly  used by Student  Sports  that were  retained  by the parent
company when Student Sports was sold in 2003.

Net Income (Loss)
The Company has  recognized  income of $1.00 million during fiscal 2004 compared
to income of $0.07 million  during the prior year.  Operating  losses for fiscal
2004 were  $0.87  million  as  compared  to $1.31  million  in  Fiscal  2003 The
improvement in income in fiscal 2004 was primarily the result of selling Student
Sports which generated significant losses in fiscal 2003, a reduction of cost of
sales at Fantasy Sports, and a reduction in general and administrative  costs at
both the operational and corporate  levels.  The current year includes  non-cash
foreign currency gains of approximately $1.29 million due to the appreciation of
the South  African  Rand  against  the US dollar of  approximately  17 %. During
fiscal 2003 net income included non-cash foreign currency gains of $1.76 million
due to the  appreciation  of the South  African  Rand  against  the US dollar of
approximately 36%.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

Cash  increased by $3.63  million  from $1.24  million at June 30, 2004 to $4.87
million at June 30, 2005. The cash balances are being held for  acquisitions and
working capital  purposes.  The Company expects this balance to be sufficient to
fund its operations and the operations of its  subsidiaries  for the next twelve
months.

Working capital increased by $3.82 million from ($0.18) million at June 30, 2004
to $3.64  million at June 30, 2005.  This  increase is  primarily  caused by the
repayment of a portion of our Notes  receivable.  Accrued interest earned during
the year has been classified as part of the Long - Term Notes Receivable.

At June 30, 2005, we had borrowings of $0.44 million,  which  consisted of $0.07
million advances  against lines of credit,  secured by the Company's cash, $0.01
million of equipment loans, and term loans of $0.36 million.

In the future the Company expects to meet its short and long term obligations in
part through the collection of amounts due from  outstanding  notes  receivable.
Those notes,  which are  denominated  in South African Rand, are to be collected
upon  certain  liquidity  events at First  Lifestyle  Holdings.  We monitor  the
financial  results of First Lifestyle  Holdings on a quarterly and annual basis.
It is our opinion, based on reviews of audited financial statements,  reviews of
budgets and  inquiries  of  management  of First  Lifestyle  Holdings,  that the
collateral  we hold,  in First  Lifestyle  Holdings is  sufficient  to repay the
outstanding notes receivable on a liquidation basis.

                                      -12-
<PAGE>

Once the funds are  collected  in South  African  Rand,  the Company  expects to
repatriate  those  funds  to  the  United  States.  The  Company  believes  that
repatriation of the full amount is allowable under current South African foreign
currency  regulations.  Over the last seven years,  we have,  from time to time,
repatriated funds from South Africa without restriction.  However,  there can be
no guarantee that the South African foreign currency regulations will not change
in the future in a manner  that might  restrict  our ability to  repatriate  the
remaining assets.

In the  future we  intend to add  additional  operating  subsidiaries  that will
produce  revenues  and net  profits.  We may  utilize a portion  of the  working
capital in connection with the acquisition or establishment of those operations.
We may  also be  required  to  secure  additional  debt  or  equity  funding  in
connection with the funding of those future acquisitions.  There is no assurance
that we will be able to  secure  additional  indebtedness  or  raise  additional
equity to finance future acquisitions on terms acceptable to management.

The following table is a summary of contractual  obligations recorded as of June
30, 2005.

<TABLE>
<CAPTION>
                                                          PAYMENTS DUE BY PERIOD

                                                                                                             MORE THAN
CONTRACTUAL OBLIGATIONS                          TOTAL      LESS THAN 1 YEAR     1-3 YEARS      3-5 YEARS     5 YEARS
                                                 -----      ----------------     ---------      ---------     -------
<S>                                                <C>                <C>             <C>       <C>             <C>
Long-Term Debt Obligations                         $371,177           $220,845        $150,332       -           -
Operating Lease Obligations                         179,146            114,946          64,200       -           -
Purchase Obligations                                575,000            510,000          65,000       -           -
Employment Contracts                              2,504,473            667,755       1,311,718       525,000     -
                                            -----------------------------------------------------------------------------
Total                                           $ 3,629,796       $  1,513,546    $  1,591,250     $ 525,000     -
                                            =============================================================================
</TABLE>


PURCHASE OBLIGATIONS

Purchase obligations  reflected on the table of contractual  obligations include
the following:

- A contract between Fantasy Sports,  Inc. and a media and marketing  consultant
for services  provided  through  November 30, 2006.  At a minimum the company is
obligated to pay $60,000 per year.  If certain incentive or additional  services
are performed additional obligations accrue.

-A contract between Fantasy Sports,  Inc. and another corporation to provide web
site hosting and customer service  functions through December 31, 2005 at a cost
of $23,500 per month.

- A contract  between  Silverstar  Holdings,  Inc. and  consultant  for services
 provided  through June 30,  2007.  At a minimum the company is obligated to pay
 $5,000 per month which is reflected in the table of contractual obligations.

In addition the consultant  received  warrants to purchase 180,000 shares of the
company's common stock.

- Various royalty  agreements  entered into by Strategy  First.  Minimum royalty
guarantees  are $ 248,230  for the year ended  June 30,  2006 and $4,883 for the
year ended June 30, 2007.

EMPLOYMENT CONTRACTS

On April 21, 2004, Strategy First, Inc., entered into employment agreements with
Don McFatridge, Brian Clarke and Richard Therrien. The employment agreements are
on an at-will basis and call for salaries of $Cdn  180,000,  160,000 and 75,000,
respectively  Each  employee is entitled to a bonus of up to 30% of their salary
at the

                                      -13-
<PAGE>

discretion of the board of directors. Mr. McFatridge  serves as Chief  Executive
Officer of  Strategy  First and  received  options to acquire  75,000  shares of
Silverstar  Holdings Common Stock. These options vest annually over a three-year
period.  Mr.  Clarke  serves as Chief  Operating  Officer of Strategy  First and
received  options to acquire 75,000 shares of Silverstar  Holdings Common Stock.
These options vest annually over a three-year  period.  Mr.  Therrien  serves as
Chief  Technology  Officer of  Strategy  First and  received  options to acquire
25,000 shares of Silverstar  Holdings Common Stock.  These options vest annually
over a three-year period.

Pursuant to an  employment  agreement  Mr. Clive  Kabatznik  will serve as Chief
Executive Officer,  President and Chief Financial Officer of the Company through
December 31, 2009. Mr.  Kabatznik  will receive  $330,000,  $342,500,  $350,000,
$350,000, and $175,000 for fiscal 2006, 2007, 2008, 2009 and 2010, respectively.

GOODWILL IMPAIRMENT TEST

We acquired Fantasy Sports,  Inc. in November 2000. At the time our strategy was
to  aggressively  expand  the  business  by  increasing  our  marketing  in  the
auto-racing  segment and developing new games for other niche sports markets. To
this end, we hired new staff and increased our marketing and development budgets
as  well.  This  strategy  was not  successful,  primarily  due to the  economic
slowdown and as a result,  Fantasy incurred annual losses though the fiscal year
ending June 30, 2003. During the seven months ended June 30, 2001,  Fantasy lost
$1,320,000  and had negative cash flow of $268,000.  For the twelve months ended
June 30, 2002, Fantasy lost $1,135,000 with negative cash flow of $566,000.  For
the twelve months ended June 30, 2003,  Fantasy lost $314,715 with negative cash
flow of $185,860.  For the twelve  months ended June 30,  2004,  Fantasy  earned
$52,785 with  positive  cash flow of $105,665.  For the twelve months ended June
30, 2005, Fantasy earned $422,637 with positive cash flow of $433,317.

Due to the accounting  recognition of losses through the fiscal year ending June
30, 2003 the carrying value of Fantasy has diminished since acquisition. On June
30, 2005,  we performed an  impairment  test on the carrying  value of Fantasy's
goodwill in  accordance  with SFAS 142.  The Company  compared the fair value of
Fantasy  (as a  reporting  unit)  to the  carrying  value of  Fantasy  including
goodwill.  The  methodology  used to  determine  fair  value  was to  develop  a
projected  fair value of the entity.  The projected fair value of Fantasy sports
was determined by dividing the average projected income for the next three years
by a 12%  capitalization  rate minus a 5% growth rate.  Results  indicated  that
impairment  of goodwill did not exist.  The Company  also  compared the carrying
value of its goodwill to the implied  goodwill value on a privately held company
in the same industry that was recently sold. Results of this test also indicated
that impairment did not exist.

FUTURE COMMITMENTS

Through  June 30,  2005,  Fantasy  Sports  generated  profit  after  substantial
operating  losses in previous  years.  We anticipate that this situation will be
maintained  and  improved  through  a  combination  of  expense  reductions  and
increased  revenues.  Strategy  First is projecting an operating  profit for the
coming twelve months.  There are no assurances that these  expectations  will be
met. In this event,  we may need to  continue to support the  operations  of our
subsidiaries.

CRITICAL ACCOUNTING POLICIES

The  following  is a  discussion  of the  accounting  policies  that the Company
believes are critical to its operations:

                                      -14-
<PAGE>

REVENUE RECOGNITION
Strategy  First  distributes  the majority of its products  through  third-party
software  distributors  to  mass-merchant  and major  retailers  and directly to
certain PC software  retailers,  all of which have  traditionally  sold consumer
entertainment  PC  software  products.  Additionally,  Strategy  may license its
products to distributors in exchange for royalty  payments.  The distribution of
products is governed by purchase orders,  distribution agreements or direct sale
agreements,  most of which allow for product  returns and price  markdowns.  For
product shipments to these software distributors or retailers,  Strategy records
a provision  for product  returns and price  markdowns  as a reduction  of gross
sales at the time the product passes to these distributors or retailers. Payment
terms generally require 10% at delivery,  with an additional 30% due at 30 days,
60 days,  and 180 days.  Revenue is recognized at the time product is shipped by
distributors.

The provision for  anticipated  product returns and price markdowns is primarily
based upon  Strategy  First's  analysis of historical  product  return and price
markdown results.  Should product sell-through results at retail store locations
fall  significantly  below anticipated levels the adequacy of this allowance may
be  insufficient.  Strategy  First's  reviews the adequacy of its  allowance for
product returns and price  markdowns and if necessary makes  adjustments to this
allowance on a quarterly basis.

In the case of royalty income, Strategy will recognize revenue when earned based
on sales  reports  from its  distributors.  Most  agreements  require  quarterly
reporting of sales with payment due within 45 days of the end of the quarter. In
many cases,  Strategy receives  guaranteed royalty income and these revenues are
recorded upon performance of deliverables per the royalty agreements.

Revenues  generated by Fantasy Sports are seasonal from  mid-February to the end
of November. Fantasy Sports' collects the majority of its revenue from customers
at the  beginning  and  mid-point of a season and defers  recognition  of income
until the season  starts.  Once a season begins  revenue is  recognized  prorata
until the season ends.

GOODWILL VALUATION

Goodwill  represents the excess of the purchase price over the fair market value
of net assets acquired.  The process of determining  goodwill requires judgment.
Evaluating goodwill for impairment involves the determination of the fair market
value of our reporting units.  Inherent in such fair market value determinations
are certain  judgments and estimates,  including the  interpretation  of current
economic  indicators and market valuations,  and our strategic plans with regard
to our operations. To the extent additional information arises or our strategies
change, it is possible that our conclusion  regarding goodwill  impairment could
change, which could have a material effect on our financial position and results
of  operations.  For those  reasons,  we believe  that the  accounting  estimate
related to goodwill impairment is a critical accounting estimate.

The  Company  reviews  goodwill  annually  (or  more  frequently  under  certain
conditions) for impairment in accordance  with SFAS No. 142,  Goodwill and Other
Intangible  Assets. The Company performed its annual impairment test of goodwill
as of June 30, 2005 and  determined  that goodwill was not  impaired.  While the
Company believes that no impairment existed as of June 30, 2005, there can be no
assurances that future economic or financial  developments  might not lead to an
impairment of goodwill.

INTANGIBLE ASSETS

Intangible assets include software game titles,  trademarks,  customer lists and
other intellectual property and non-competition  agreements.  Intangible assets,
excluding  goodwill,  are  stated  on the basis of cost and are  amortized  on a
straight-line  basis  over  estimated  lives of three to ten  years.  Intangible
assets with indefinite  lives are not amortized but are evaluated for impairment
annually unless circumstances dictate

                                      -15-
<PAGE>

otherwise.  Management  periodically  reviews  intangible  assets for impairment
based on an assessment of undiscounted  future cash flows, which are compared to
the carrying value of the intangible assets.  Should these cash flows not equate
to or exceed the carrying value of the intangible,  a discounted cash flow model
is used to determine the extent of any impairment charge required.

ITEM 7A.   QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company  does not  ordinarily  hold market risk  sensitive  instruments  for
trading  purposes.  The company does however recognize market risk from interest
rate and foreign currency exchange exposure.  Any movements of interest rates as
they relate to outstanding debt would be immaterial to the financial  results of
the Company.

INTEREST RATE RISK

At June  30,  2005,  our cash  resources  earned  interest  at  variable  rates.
Accordingly,  the Company's return on these funds is affected by fluctuations in
interest  rates.  Any decrease in interest rates will have a negative  effect on
the Company's earnings.

FOREIGN CURRENCY RISK

Strategy First, Inc. is incorporated in Canada and sells products throughout the
United States and Europe. Its functional  currency is the Canadian Dollar.  This
has  exposed  the company to market  risk with  respect to  fluctuations  in the
relative  value of the Euro,  British  Pound,  the Canadian  Dollar,  and the US
Dollar.

Certain of the Company's cash balances and the remaining  proceeds from the sale
of its South African  subsidiaries  are  denominated in South African Rand. This
has  exposed  the Company to market  risk with  respect to  fluctuations  in the
relative value of the South African Rand against the US Dollar.

On March 9, 2005, the Company  acquired a  twelve-month  Rand put/US dollar call
option,  at a strike  price of R6.25 to the US  dollar.  During  its term,  this
option serves as a partial  protection  against the  depreciation of the SA Rand
versus the US dollar. The cost of the option was approximately  $200,000 and its
price  was  marked to market at the  close of  business  on June 30,  2005.  The
Company will continue to adjust the market value of this option as of the end of
subsequent reporting periods.

At June 30,  2005,  we had assets  denominated  in South  African Rand of R 34.8
million.

The following is information concerning assets denominated in South African Rand
and the foreign currency gains and losses recognized during fiscal 2005:

<TABLE>
<CAPTION>
                                                           Balance              Foreign Currency Gain/(Loss) for the
                                                     As of June 30, 2005              Year Ended June 30, 2005
                                               -------------------------------- --------------------------------------
                                                           In Rand                          In US Dollars
<S>                                                         <C>                             <C>
Cash                                                   R    10,650,114                      $    287,881
Notes Receivable                                       R    21,749,971                      $   (350,584)
Other                                                  R     2,424,441                      $    157,005
</TABLE>



                                      -16-
<PAGE>
<TABLE>
<CAPTION>
                                              SILVERSTAR HOLDINGS, LTD. AND SUBSIDIARIES

                                                           TABLE OF CONTENTS

                                                                                                                PAGE

<S>                                                                                                        <C>
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM                                                          F-1


CONSOLIDATED FINANCIAL STATEMENTS

   Balance Sheets                                                                                                F-2

   Statements of Operations                                                                                      F-3

   Statements of Stockholders' Equity                                                                            F-4

   Statements of Cash Flows                                                                                   F-5 - F-6

   Notes to Consolidated Financial Statements                                                                F-7 - F-32
</TABLE>



                                      -17-
<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders
Silverstar Holdings, Ltd.
Boca Raton, Florida

We have  audited the  accompanying  consolidated  balance  sheets of  Silverstar
Holdings,  Ltd. and Subsidiaries (the Company) as of June 30, 2005 and 2004, and
the related consolidated statements of operations, stockholders' equity and cash
flows for each of the three  years in the  period  ended  June 30,  2005.  These
consolidated  financial  statements  are  the  responsibility  of the  Company's
management.  Our  responsibility  is to express  an  opinion on these  financial
statements based on our audit.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audits 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 that our
audits provide a reasonable basis for our opinion.

In our opinion, the accompanying  consolidated  financial statements referred to
above present  fairly,  in all material  respects,  the  consolidated  financial
position of  Silverstar  Holdings,  Ltd. and  Subsidiaries  at June 30, 2005 and
2004, and the consolidated  results of their operations and their cash flows for
each of the three years in the period ended June 30, 2005,  in  conformity  with
accounting principles generally accepted in the United States.

                         /S/ RACHLIN COHEN & HOLTZ LLP
                            RACHLIN COHEN & HOLTZ LLP

Fort Lauderdale, Florida
August 29, 2005


                                      F-1
<PAGE>

                   SILVERSTAR HOLDINGS, LTD. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                             JUNE 30, 2005 AND 2004

<TABLE>
<CAPTION>
                                        ASSETS                                                2005              2004
                                                                                          ------------       ------------
<S>                                                                                       <C>              <C>
Current Assets:
    Cash and cash equivalents
     (includes restricted cash of  $67,189 and $321,096 in 2005 and 2004,
    respectively)                                                                         $  4,870,486       $  1,235,310
    Accounts receivable, net                                                                    95,130              1,068
    Current portion of long-term notes receivable                                              118,272            138,704
    Prepaid expenses and other current assets                                                  183,221             56,096
    Option contract                                                                            359,171                  -
                                                                                          ------------       ------------
        Total current assets                                                                 5,626,280          1,431,178
                                                                                          ------------       ------------
Property, Plant and Equipment, net                                                             114,628             49,856
Investments in Non-Marketable Securities                                                       843,566            843,566
Long-Term Notes Receivable                                                                   3,135,763          7,977,549
Goodwill, net                                                                                3,715,153          2,947,824
Intangible Assets, net                                                                       1,241,701             12,500
Deferred Charges and Other Assets                                                               23,374              2,985
                                                                                          ------------       ------------
       Total assets                                                                       $ 14,700,465       $ 13,265,458
                                                                                          ============       ============
                         LIABILITIES AND STOCKHOLDERS' EQUITY

Current Liabilities:
    Lines of credit                                                                       $     67,189       $    305,160
    Current portion of long-term debt                                                          220,845             24,883
    Accounts payable                                                                           395,383            226,830
    Accrued expenses                                                                           675,681            359,022
    Deferred revenue                                                                           629,248            693,264
                                                                                          ------------       ------------
       Total current liabilities                                                             1,988,346          1,609,159
                                                                                          ------------       ------------
Long-Term Debt, net                                                                            150,047             10,633
Obligation to issue common stock                                                               273,554            223,559
                                                                                          ------------       ------------

       Total liabilities                                                                     2,411,947          1,843,351
                                                                                          ------------       ------------
Commitments, Contingencies and Other Matters

Stockholders' Equity:

Preferred stock, $0.01 par value; 5,000,000 shares authorized;
     no shares issued and outstanding
Common stock, Class A, $0.01 par value, 23,000,000 shares authorized; 8,233,324
     and 7,798,924 shares issued and outstanding, respectively                                  82,333             77,989
Common stock, Class B, $0.01 par value; 2,000,000 shares authorized; 835,260 and
     896,589 shares issued and outstanding, respectively                                         8,353              8,966
Common stock, FSAH Class B $0.001 par value; 10,000,000 shares authorized; 2,671,087
     and 2,671,087 shares issued and outstanding, respectively                                     600                600
Additional paid-in capital                                                                  64,602,803         63,904,557
Accumulated deficit                                                                        (52,411,167)       (52,570,005)
Accumulated comprehensive income                                                                 5,596                  -
                                                                                          ------------       ------------
Total Stockholders' Equity                                                                  12,288,518         11,422,107
                                                                                          ------------       ------------
Total Liabilities and Stockholders' Equity                                                $ 14,700,465       $ 13,265,458
                                                                                          ============       ============
</TABLE>

                 See notes to consolidated financial statements


                                      F-2
<PAGE>

                   SILVERSTAR HOLDINGS, LTD. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                    YEARS ENDED JUNE 30, 2005, 2004 AND 2003

<TABLE>
<CAPTION>
                                                                         2005               2004               2003
                                                                     ------------       ------------       ------------
<S>                                                                  <C>                <C>                <C>
Revenues                                                             $  2,299,254       $  2,367,463       $  3,141,448
Operating Expenses:
    Cost of sales                                                       1,136,497          1,405,728          2,005,598
    Selling, general and administrative                                 1,762,165          1,776,619          2,315,056
    Amortization of intangibles                                            23,809             18,250             67,000
    Depreciation                                                           20,896             39,205             68,428
                                                                     ------------       ------------       ------------
       Total operating expenses                                         2,943,367          3,239,802          4,456,082
                                                                     ------------       ------------       ------------
         Operating loss                                                  (644,113)          (872,339)        (1,314,634)
Other Income (Expense)                                                    158,043             11,801            (17,443)
Foreign Currency Gain                                                      81,773          1,287,291          1,763,115
Interest Income                                                           586,830            628,737            650,329
Interest Expense                                                          (23,695)           (25,385)           (12,318)
                                                                     ------------       ------------       ------------
   Income from continuing operations before income taxes                  158,838          1,030,105          1,069,049
Provision for Income Taxes                                                      -                  -                  -
   Income from continuing operations                                      158,838          1,030,105          1,069,049

Discontinued Operations:
    Loss from operations, net of income taxes of $0, $0 and $0,
      respectively                                                              -                  -           (736,947)
    Loss on disposition, net of income taxes of $0, $0 and $0,
      respectively                                                              -            (27,582)          (262,754)
                                                                     ------------       ------------       ------------
Net Income                                                           $    158,838       $  1,002,523       $     69,348
                                                                     ============       ============       ============

Income (Loss) Per Share:
 Basic:

    Continuing operations                                            $       0.02       $       0.12       $       0.12
    Discontinued operations                                                 (0.00)             (0.00)             (0.11)
                                                                     ------------       ------------       ------------
         Net Income                                                  $       0.02       $       0.12       $       0.01
                                                                     ============       ============       ============

 Diluted:
   Continuing operations                                             $       0.02       $       0.11       $       0.10
   Discontinued operations                                                   0.00               0.00              (0.10)
                                                                     ------------       ------------       ------------
       Net Income                                                    $       0.02       $       0.00       $       0.00
                                                                     ============       ============       ============

Weighted Average Common Stock Outstanding:
    Basic:                                                              8,791,121          8,575,579          8,704,620
                                                                     ============       ============       ============
    Diluted:                                                            9,170,411          9,089,113         10,345,994
                                                                     ============       ============       ============
</TABLE>


                 See notes to consolidated financial statements.


                                      F-3
<PAGE>

                   SILVERSTAR HOLDINGS, LTD. AND SUBSIDIARIES
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                             AND COMPREHENSIVE LOSS
                     YEARS ENDED JUNE 30, 2005 2004 AND 2003

<TABLE>
<CAPTION>
                                            Silverstar                      Silverstar                   First South Africa
                                           Holdings Ltd.                    Holdings Ltd.                      Holdings
                                               Class A                         Class B                         Class B
                                            Common Stock                     Common Stock                    Common Stock
                                    -----------------------------   -----------------------------     ----------------------------
                                       Shares            Amount        Shares           Amount           Shares          Amount
                                    ------------     ------------   ------------     ------------     ------------    ------------

YEAR ENDED JUNE 30, 2003:

<S>                                    <C>           <C>                 <C>         <C>                 <C>          <C>
BALANCE, JUNE 30, 2002                 8,001,310     $     80,013        946,589     $      9,466        2,671,087    $        600

Purchase and retirement of
  treasury stock                        (171,700)          (1,717)             -                -                -               -
Stock redemption -                             -
  (sale of subsidiary)                  (325,686)          (3,257)             -                -                -               -
 Net Income                                    -                -              -                -                -               -

Balance, June 30, 2003                 7,503,924           75,039        946,589            9,466        2,671,087             600
                                    ============     ============   ============     ============     ============    ============

YEAR ENDED JUNE 30, 2004:

Stock issued                             245,000            2,450              -                -                -               -
 Conversion of shares                     50,000              500        (50,000)            (500)               -               -
 Net Income                                    -                -              -                -                -               -

Balance, June 30, 2004                 7,798,924           77,989        896,589            8,966        2,671,087             600
                                    ============     ============   ============     ============     ============    ============


YEAR ENDED JUNE 30, 2005:

Stock issued/Acquisition                 377,371            3,774              -                -                -               -
Conversion of shares                      61,329              613        (61,329)            (613)               -               -
Exercise of stock options                 15,000              150              -                -                -               -
Stock-based compensation                       -                -              -                -                -               -
Warrants issued - acquisition                  -                -              -                -                -               -
 Purchase and retirement
 of treasury stock                       (19,300)            (193)             -                -                -               -
     Net Income                          158,838                -        158,838
    Other comprehensive income
       foreign currency translation
       adjustment, net of taxes                -                -              -                -                -               -
                                    ------------     ------------   ------------     ------------     ------------    ------------
Balance, June 30, 2005              $  8,233,324     $     82,333   $    835,260     $      8,353     $  2,671,087             600
                                    ============     ============   ============     ============     ============    ============
</TABLE>

<TABLE>
<CAPTION>
                                                                         Accumulated
                                        Additional                          Other
                                         Paid-in       Accumulated      Comprehensive
                                         Capital          Deficit           Income           Total
                                       ------------     ------------     ------------    ------------

YEAR ENDED JUNE 30, 2003:

<S>                                    <C>              <C>                  <C>         <C>
BALANCE, JUNE 30, 2002                 $ 63,763,870     $(53,641,876)        $      -    $ 10,212,073

Purchase and retirement of
  treasury stock                            (23,418)               -                -         (25,135)
Stock redemption -
  (sale of subsidiary)                     (227,980)               -                -        (231,237)
 Net Income                                       -           69,348                -          69,348

Balance, June 30, 2003                   63,512,472      (53,572,528)               -    $ 10,025,049
                                       ============     ============     ============    ============

YEAR ENDED JUNE 30, 2004:

Stock issued                                392,085                -                -         394.535
 Conversion of shares                             -                -                -               -
 Net Income                                       -        1,002,523                -       1,002,523

Balance, June 30, 2004                   63,904,557      (52,570,005)               -    $ 11,422,107
                                       ============     ============     ============    ============

YEAR ENDED JUNE 30, 2005:

Stock issued/Acquisition                    513,603                -                -         517,377
Conversion of shares                              -                -                -               -
Exercise of stock options                     6,500                -                -           6,650
Stock-based compensation                     32,000                -                -          32,000
Warrants issued - acquisition               167,400                -                -         167,400
 Purchase and retirement
 of treasury stock                          (21,257)               -                -         (21,450)
    Net Income
    Other comprehensive income
       foreign currency translation
       adjustment, net of taxes                   -                -            5,596           5,596
                                       ------------     ------------     ------------    ------------
Balance, June 30, 2005                 $ 64,602,803     $(52,411,167)    $      5,596    $ 12,288,518
                                       ============     ============     ============    ============
</TABLE>

                 See notes to consolidated financial statements.

                                      F-4
<PAGE>

                   SILVERSTAR HOLDINGS, LTD. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                    YEARS ENDED JUNE 30, 2005, 2004 AND 2003

<TABLE>
<CAPTION>
                                                                 2005            2004            2003
                                                             -----------     -----------     -----------
Cash Flows from Operating Activities:
<S>                                                          <C>             <C>             <C>
    Net income from continuing operations                    $   158,838     $ 1,002,523     $ 1,069,049
    Provision for doubtful accounts                               79,271               -           3,365
    Depreciation and amortization                                 44,705          57,455         135,428
    Stock-based compensation                                      49,995               -               -
    Common stock warrants issued for services                     32,000               -               -
    Unrealized foreign currency gains                           (300,390)     (1,261,824)     (1,704,106)
    Non-cash interest income on notes receivable                (433,416)       (611,720)       (603,984)
    Changes in operating assets and liabilities, net            (230,348)       (206,713)        193,261
    (Increase) Decrease in other assets                                -           3,145          (2,274)
    Loss on disposal of fixed assets                                   -          51,065             182
                                                             -----------     -----------     -----------

        Net Cash Used in Continuing Operations                  (599,345)       (966,069)       (909,079)
        Net Cash Used in Discontinued Operations                       -               -        (247,000)
                                                             -----------     -----------     -----------
        Net Cash Used in Operating Activities                   (599,345)       (966,069)     (1,156,079)
                                                             -----------     -----------     -----------

Cash Flows from Investing Activities:

    Acquisition of property, plant and equipment                  (3,158)           (542)        (24,701)
    Proceeds on disposal of property, plant and equipment              -           1,220               -
    Acquisition of non-competitive agreement                      (2,906)              -               -
    Purchase of option premium                                  (190,257)              -               -
    Proceeds from repayment of long-term note receivable       5,420,720         218,679         115,308
    Cash paid for acquisition of subsidiary                     (682,011)              -               -
                                                             -----------     -----------     -----------

        Net Cash  Provided by Investing Activities           $ 4,542,388     $   219,357     $    90,607
                                                             -----------     -----------     -----------
</TABLE>

                 See notes to consolidated financial statements.

Continued on next page

                                      F-5
<PAGE>

                   SILVERSTAR HOLDINGS, LTD. AND SUBSIDIARIES

                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

                    YEARS ENDED JUNE 30, 2005, 2004 AND 2003

<TABLE>
<CAPTION>
                                                                   2005            2004            2003
                                                               -----------     -----------     -----------
Cash Flows from Financing Activities:
<S>                                                            <C>             <C>             <C>
    Short term borrowings, net                                 $  (237,971)    $    86,309     $   168,851
    Repayment of long-term debt                                    (60,692)        (24,605)         (1,282)
    Proceeds from the exercise of stock options                      6,650         302,689               -
    Purchase of treasury stock transactions                        (21,450)              -         (25,135)
                                                               -----------     -----------     -----------
        Net Cash Provided by (Used in) Financing Activities       (313,463)        364,393         142,434
                                                               -----------     -----------     -----------

Effect of exchange rates in cash                                     5,596               -               -
                                                               -----------     -----------     -----------

Net Increase (decrease) in Cash and Cash Equivalents             3,635,176        (382,319)       (923,038)

Cash and Cash Equivalents, Beginning                             1,235,310       1,617,629       2,540,667
                                                               -----------     -----------     -----------

Cash and Cash Equivalents, Ending                              $ 4,870,486     $ 1,235,310     $ 1,617,629
                                                               ===========     ===========     ===========

Supplemental Disclosure of Cash Flow Information:

    Cash paid during the year for interest                     $    23,695     $    25,385     $    12,318
                                                               ===========     ===========     ===========

    Cash Paid during the year for income taxes                 $         -     $         -     $         -
                                                               ===========     ===========     ===========
</TABLE>

                 See notes to consolidated financial statements.


                                      F-6
<PAGE>

                   SILVERSTAR HOLDINGS, LTD. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                          JUNE 30, 2005, 2004 AND 2003

NOTE 1.  ORGANIZATION AND PRINCIPAL ACTIVITIES OF THE GROUP

Silverstar   Holdings,   Ltd.  (formerly   Leisureplanet   Holdings  Ltd.)  (the
"Company"),  was founded on  September  6, 1995.  The purpose of the Company has
changed from  acquiring  and operating  South African  Companies to investing in
companies that fit a predefined investment strategy.

On November 17, 2000, the Company  acquired  Fantasy Sports,  Inc.  ("Fantasy").
Fantasy specializes in Internet-based subscriptions for NASCAR, college football
and  basketball  and other  fantasy  sports games.  On September  24, 2001,  the
Company  acquired  Student  Sports,  Inc.  ("Student  Sports"),  a media company
producing  publications,  television programs and various marketing  initiatives
for the high school sports  market.  In June 2003,  the company sold its Student
Sports  subsidiary  and  it is  reflected  as  discontinued  operations  in  the
accompanying financial statements. (See Discontinued Operations below)

In April 2005, the Company acquired Strategy First Inc. (www.strategyfirst.com),
a leading  developer and worldwide  publisher of entertainment  software for the
PC. Founded in 1990, the company  publishes  software games primarily for the PC
platform.

Investments  have  been  made in other  companies,  which  are in line  with the
Company's new focus (see Note 6).

The Company  currently  has both Class A and Class B common  shares.  Holders of
Class A Common Stock have one vote per share on each matter  submitted to a vote
of the  shareholders  and a ratable  right to the net assets of the Company upon
liquidation.  Holders  of the  common  stock do not have  preemptive  rights  to
purchase  additional shares of Common Stock or other  subscription  rights.  The
Class A  common  stock  carries  no  conversion  rights  and is not  subject  to
redemption  or to any sinking  fund  provisions.  All shares of common stock are
entitled to share  equally in  dividends  from  legally  available  resources as
determined by the board of directors.  Upon  dissolution  or  liquidation of the
Company,  whether  voluntary or  involuntary,  holders of the common stock,  are
entitled to receive  assets of the Company  available  for  distribution  to the
shareholders.

Class B and Class A Common  Stock are  substantially  identical  except that the
holders of Class B Common Stock have 5 votes per share on each matter considered
by shareholders.  Each share of Class B Common Stock is automatically  converted
into one share of Class A Common Stock upon sale or death of the shareholder.

DISCONTINUED OPERATIONS

On June 10, 2003, the company sold  substantially  all assets and liabilities of
Student Sports, Inc effective as of May 15, 2003. The consideration for the sale
of Student  Sports was 325,686 shares of Silverstar  Holdings  common stock that
were returned to the Company as well as the  forgiveness of a maximum of 913,745
contingent shares of Silverstar  Holdings that could have been payable to former
Student Sports shareholders in April 2004. (see Note 11)

                                      F-7
<PAGE>

NOTE 2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The  consolidated  financial  statements  have been prepared in accordance  with
accounting  principles  generally  accepted in the United States and incorporate
the following significant accounting policies:

CONSOLIDATION

The consolidated  financial  statements  include the accounts of the Company and
all of its subsidiaries in which it has a majority voting interest.  Investments
in  affiliates  are  accounted  for under  either the  equity or cost  method of
accounting,  where  appropriate.  All  significant  inter-company  accounts  and
transactions have been eliminated in the consolidated financial statements.  The
entities included in these consolidated financial statements are as follows:

                Silverstar Holdings, Ltd. (Parent Company)
                Silverstar Holdings, Inc.
                First South African Management Corp.
                First South African Holdings, Ltd. (FSAH)
                Fantasy Sports, Inc.
                Student Sports, Inc.
                Strategy First, Inc.

USE OF ESTIMATES

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States  requires  management to make estimates
and  assumptions  that affect the  reported  amounts of assets and  liabilities,
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.

CASH AND CASH EQUIVALENTS

Cash and cash equivalents consist of cash and all highly liquid investments with
original maturities of three months or less.

CONCENTRATIONS OF CREDIT AND MARKET RISKS

Financial  instruments that potentially subject the Company to concentrations of
credit and market  risk are  comprised  of cash and cash  equivalents  and notes
receivable.

            CASH

                  The Company currently  maintains a substantial  amount of cash
                  and cash  equivalents  with  financial  institutions  in South
                  Africa denominated in South African Rand. Although the Company
                  has  entered  into a US Dollar  South  African  Rand  put/call
                  option to  partially  protect it against  depreciation  of the
                  South African Rand,  changes in the value of the Rand compared
                  to the U.S. dollar may still have an unfavorable impact on the
                  value of the cash and cash  equivalents.  In  addition,  these
                  financial instruments are not subject to credit insurance.

                  The  Company  maintains  deposit  balances  at U.S.  financial
                  institutions  that,  from time to time,  may exceed  federally
                  insured  limits.  The  Company  maintains  its cash  with high
                  quality  financial  institutions,  which the Company  believes
                  limits risk.

                                      F-8
<PAGE>

             NOTES RECEIVABLE

                  The  Company's  notes  receivable  are to be  settled in South
                  African Rand by South African companies. The Company's ability
                  to collect on these  notes may be  affected  by the  financial
                  condition of the debtor's economic  conditions in South Africa
                  and the value of the South  African  Rand,  as compared to the
                  U.S. dollar.  In addition,  the Company's  ability to withdraw
                  these  funds  from  South   Africa  after   collection   while
                  unrestricted  at  present,  may be subject to  approval by the
                  South African government.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The  carrying  value of cash  and  cash  equivalents,  accounts  receivable  and
accounts payable  approximate  fair value due to the short-term  nature of these
instruments.  The carrying value of long-term notes receivable approximates fair
values since  interest  rates are keyed to the South African prime lending rate.
The carrying value of long-term debt  approximates  fair value since there terms
are consistent with prevailing market rates.

PROPERTY, PLANT AND EQUIPMENT

Property,  plant and  equipment are recorded at cost.  Depreciation  is provided
using the  straight-line  method over the estimated  useful lives of the assets.
Equipment  is  depreciated  over  3 to  10  years.  Leasehold  improvements  are
amortized  over  the  shorter  of the  terms of the  related  leases  and  their
estimated useful lives.

SOFTWARE DEVELOPED FOR INTERNAL USE

As a result of the  acquisition  of Fantasy in  November  2000,  the Company has
adopted the provisions of AICPA Statement of Position (SOP) 98-1 "Accounting for
the Costs of Computer  Software  Developed and Obtained for Internal  Use".  SOP
98-1 requires the  capitalization of all internal and external costs incurred to
develop internal use software during the application  development stage. Fantasy
operates its fantasy  league  through the use of software the company  develops.
Fantasy develops software to run its fantasy games; however, such costs were not
significant during fiscal 2005, 2004 or 2003.

GOODWILL

The Company adopted  Statement of Financial  Accounting  Standards No. 142 (SFAS
142), Goodwill and Other Intangible Assets. Goodwill and other intangible assets
with  indefinite  lives must be tested for  impairment on an annual  basis.  The
Company performs this annual impairment test at fiscal year end for goodwill.

SFAS 142 requires the Company to compare the fair value of the reporting unit to
its  carrying  amount  on an annual  basis to  determine  if there is  potential
goodwill  impairment.  If the fair value of the reporting  unit is less than its
carrying value, an impairment loss is recorded to the extent that the fair value
of the goodwill within the reporting unit is less than its carrying value.  SFAS
142 also requires the Company to compare the fair value of an  intangible  asset
to its carrying  amount.  If the carrying amount of the intangible asset exceeds
its fair value, an impairment  loss is recognized.  Fair values for goodwill and
other indefinite-lived intangible assets are determined based on discounted cash
flows or market multiples as appropriate.

The Company's  goodwill  represents  the excess  acquisition  cost over the fair
value of the tangible and  identified  intangible  net assets of Fantasy  Sports
acquired in 2000 and Strategy  First  acquired in 2005. For the years ended June
30,  2005,  2004 and 2003,  the Company  applied what it believes to be the most
appropriate  valuation

                                      F-9
<PAGE>

methodology  for the  reporting  unit.  If the  Company had  utilized  different
valuation methodologies,  the impairment test results could differ. There was no
impairment of goodwill for the years ended June 30, 2005, 2004 and 2003.

INTANGIBLE ASSETS

Intangible  assets include  software game titles,  trademarks,  customer  lists,
intellectual  property  and  non-competition   agreements.   Intangible  assets,
excluding  goodwill,  are  stated  on the basis of cost and are  amortized  on a
straight-line  basis  over  estimated  lives of three to ten  years.  Intangible
assets with indefinite  lives are not amortized but are evaluated for impairment
annually unless circumstances dictate otherwise. Management periodically reviews
intangible  assets for impairment based on an assessment of undiscounted  future
cash flows,  which are compared to the carrying value of the intangible  assets.
Should  these  cash  flows not  equate to or exceed  the  carrying  value of the
intangible,  a discounted cash flow model is used to determine the extent of any
impairment charge required.  Customer lists are amortized over a period of three
to ten years.  The patents,  trademarks  intellectual  property and  non-compete
agreements  related to  discontinued  operations were amortized over a period of
three to twenty five years, up to the time of their disposal (see Note 11).

FOREIGN CURRENCY TRANSLATION

The  functional  currency  of the  Company  is the  United  States  Dollar;  the
functional  currency of First South African  Holdings,  Ltd. (FSAH) is the South
African Rand; the functional  currency of Strategy  First,  Inc. is the Canadian
Dollar.  Accordingly,  the  following  rates  of  exchange  have  been  used for
translation purposes:

Assets and  liabilities are translated into United States Dollars using exchange
rates at the balance sheet date. Common stock and additional paid-in capital are
translated  into  United  States  Dollars  using  historical  rates  at  date of
issuance.  Revenue,  if any,  and  expenses are  translated  into United  States
Dollars using the weighted  average  exchange rates for each year. The resultant
translation  adjustments  for FSAH are reported in the  statement of  operations
since FSAH has sold all its operating  subsidiaries.  The resultant  translation
adjustments for Strategy First, Inc. are reported as other comprehensive income.

REVENUE RECOGNITION

Revenues  generated  by Fantasy are  seasonal  from  mid-February  to the end of
November.  Fantasy  collects its revenue at the  beginning  and mid-point of the
season and recognizes this deferred revenue pro rata over the season.

Strategy  First  distributes  the majority of its products  through  third-party
software  distributors  to  mass-merchants  and major  retailers and directly to
certain PC software  retailers,  all of which have  traditionally  sold consumer
entertainment  PC  software  products.  Additionally,  Strategy  may license its
products to distributors in exchange for royalty  payments.  The distribution of
products is governed by purchase orders,  distribution agreements or direct sale
agreements,  most of which allow for product  returns and price  markdowns.  For
product shipments to these software distributors or retailers,  Strategy records
a 30% provision for product  returns and price markdowns as a reduction of gross
sales at the time the product passes to these distributors or retailers.

The provision for  anticipated  product returns and price markdowns is primarily
based upon Strategy's  analysis of historical  product return and price markdown
results.  Should  product  sell-through  results at retail store  locations fall
significantly  below  anticipated  levels the adequacy of this  allowance may be
insufficient.  Strategy  will review the adequacy of its  allowance  for product
returns and price  markdowns  and if  necessary  will make  adjustments  to this
allowance on a quarterly basis.

                                      F-10
<PAGE>

In the case of royalty  income,  Strategy  will  record  this income when earned
based on sales reports from its distributors.  In many cases,  Strategy receives
guaranteed  royalty income and these  revenues are recorded upon  performance of
deliverables per the royalty  agreements.  These amounts are carried as accounts
receivable until paid.

Revenues from Student Sports are presented in Discontinued Operations

ADVERTISING COSTS

Advertising  costs are  expensed as  incurred.  Advertising  costs  incurred for
continuing  operations for the year ended June 30, 2005,  were $196,861 of which
$186,170 was incurred by Fantasy Sports,  Inc. For the years ended June 30, 2004
and  2003  advertising  expenses  were  $291,200,  and  $267,857,  respectively.
Advertising  costs incurred for  discontinued  operations  during the year ended
June 30, 2003, were $7,015.

 INCOME TAXES

The Company  accounts for its income taxes using SFAS No. 109,  "Accounting  for
Income Taxes",  which requires the  recognition of deferred tax  liabilities and
assets for expected future tax consequences of events that have been included in
the  financial  statements  or tax  returns.  Under this  method,  deferred  tax
liabilities  and assets  are  determined  based on the  difference  between  the
financial  statement and tax bases of assets and  liabilities  using enacted tax
rates in effect for the year in which the differences are expected to reverse.

STOCK-BASED COMPENSATION

Statement of Financial Accounting Standards No. 123, "Accounting for Stock-Based
Compensation"  ("SFAS No. 123"),  encourages  but does not require  companies to
record  stock-based  compensation  plans  using a fair value based  method.  The
Company has chosen to continue to account for stock-based compensation using the
intrinsic value based method  prescribed in Accounting  Principles Board Opinion
No. 25,  "Accounting for Stock Issued to Employees."  Accordingly,  compensation
cost for stock  options is measured as the excess,  if any, of the quoted market
price of the Company's  common stock at the date of the grant over the amount an
employee must pay to acquire the stock.

If the  Company  used the fair  value-based  method  of  accounting  to  measure
compensation expense for options granted at grant date as prescribed by SFAS No.
123,  income  and loss per share  from  continuing  operations  would  have been
reduced to the proforma amounts indicated below.

<TABLE>
<CAPTION>
                                                                2005             2004            2003
                                                            -----------      -----------     -----------
<S>                                                         <C>              <C>             <C>
        Income from continuing operations as reported       $   158,838      $ 1,030,105     $ 1,069,049
        Less: Compensation expense for options
             awards determined by the fair-value -based
              method                                           (677,245)         (88,888)        (15,472)
                                                            -----------      -----------     -----------
        Proforma net income/(loss) from continuing
             operations                                     ($  518,407)     $   941,217     $ 1,053,577
                                                            ===========      ===========     ===========
        Basic:
              As reported                                        $0.02            $0.12           $0.12
              Pro forma                                         ($0.05)           $0.11           $0.12

         Assuming Full dilution:
              As reported                                        $0.02            $0.11           $0.10
              Pro forma                                         ($0.04)           $0.10           $0.10
</TABLE>


                                      F-11
<PAGE>
The weighted  average grant date fair value of options granted in 2005, 2004 and
2003 and the  significant  assumptions  used in determining  the underlying fair
value of each option grant on the date of the grant  utilizing the Black Scholes
option pricing model were as follows:

<TABLE>
<CAPTION>
                                                                         2005             2004            2003
                                                                         ----             ----            ----
<S>                                                                      <C>             <C>              <C>
          Weighted average grant-date fair value of
             options granted                                             $0.94           $1.44            $0.14
          Assumptions:

             Risk free interest rate                                  3.19-4.01%         3.17 %          3.14 %
             Expected life                                             3-5 Years        5 Years          5 Years
             Expected volatility                                       126-142%           142%            127%
             Expected dividend yield                                     0.00%            0.0%            0.0%
</TABLE>

In December 2004,  the FASB issued SFAS No. 123R,  "Share-Based  Payment".  This
standard  replaces SFAS No. 123,  "Accounting for Stock-Based  Compensation" and
supersedes  Accounting  Principles Board (`APB') Opinion No. 25, "Accounting for
Stock Issued to Employees." The standard requires  companies to expense the fair
value of stock  option on the grant date and is  effective  for  annual  periods
beginning  after June 15, 2005. In accordance  with the revised  statement,  the
expense  attributable to stock options  granted or vested  subsequent to July 1,
2005,  will be  required  to be  recognized  by the  Company.  Based on existing
unvested  option  agreements the company  anticipates  an additional  expense of
approximately  $68,000 in fiscal 2006 which could increase if additional options
are granted during the fiscal year.

NET INCOME PER SHARE

Basic net income per share is computed by  dividing  net income by the  weighted
average  number of common  shares  outstanding.  Diluted net income per share is
computed by dividing net income by the weighted  average number of common shares
outstanding  and dilutive  potential  common shares which  includes the dilutive
effect of stock options,  warrants,  and shares to be issued in connection  with
the acquisition of Student Sports (see Note 3). Dilutive potential common shares
for all periods presented are computed  utilizing the treasury stock method. The
dilutive  effect of shares to be issued in connection  with the  acquisition  of
Student Sports is computed  using the average market price for the quarter.  The
diluted  share  base for the  year  ended  June  30,  2002  excludes  shares  of
1,737,910.  These  shares are excluded  due to their  anti-dilutive  effect as a
result of the Company's loss from continuing operations during 2002.

RECENTLY ISSUED ACCOUNTING STANDARDS

In December 2004, the FASB issued  Statement of Financial  Accounting  Standards
No. 123,  (revised 2004) (SFAS 123R)  "Share-Based  Compensation"  revising SFAS
123, Accounting for Stock-Based Compensation and superseding APB 25, "Accounting
for Stock Issued to Employees".  This SFAS eliminates the alternative to use APB
25's  intrinsic  value  method of  accounting  that was  provided in SFAS 123 as
originally  issued.  SFAS  123R  establishes  standards  for the  accounting  of
transactions  in which a company  exchanges its equity  instruments for goods or
services or incurs  liabilities in exchange for goods or services that are based
on the fair value of the company'  equity  instruments or that may be settled by
the issuance of equity  instruments.  This SFAS focuses  primarily on accounting
for  transactions  in which a company obtains  employee  services in share-based
payment   transactions,   and  does  not  change  the  accounting  guidance  for
share-based  payment  transactions with parties other than employees.  This SFAS
requires a public company to measure the cost of employee  services  received in
exchange for an award of equity  instruments  based on the grant-date fair value
of the award (with limited  exceptions).

                                      F-12
<PAGE>

That cost  will be  recognized  over the  period  during  which an  employee  is
required  to provide  service in  exchange  for the award,  usually  the vesting
period.  The  grant-date  fair  value of  employee  share  options  and  similar
instruments will be estimated using option-pricing models. If an equity award is
modified after the grant date, incremental  compensation cost will be recognized
in an amount  equal to the excess of the fair value of the  modified  award over
the fair value of the original award immediately  before the modification.  SFAS
123R  becomes  effective  as of the  beginning  of the first  interim  or annual
reporting period that begins after June 15, 2005.

In December 2004, the FASB issued  Statement of Financial  Accounting  Standards
No. 153,  (SFAS 153)  "Exchanges  of  Nonmonetary  Assets - an  amendment of APB
Opinion No.  29".  Opinion 29 provided  an  exception  to the basic  measurement
principle  (fair  value)  for  exchanges  of  similar  productive  assets.  That
exception  required  that  some  nonmonetary  exchanges,  although  commercially
substantive, be recorded on a carryover basis. SFAS 153 eliminates the exception
to fair value for exchanges of similar  productive assets and replaces it with a
general  exception  for  exchange  transactions  that  do  not  have  commercial
substance.  The Company  expects  that the  adoption of SFAS 153 will not have a
material effect on the Company's  financial  position,  results of operations or
cash flows.

FASB Staff Position No. 109-2 (FSP 109-2),  "Accounting and Disclosure  Guidance
for the  Foreign  Earnings  Repatriation  Provision  within  the  American  Jobs
Creation Act of 2004",  provides guidance under SFAS 109, "Accounting for Income
Taxes," with  respect to  recording  the  potential  impact of the  repatriation
provisions  of the  American  Jobs  Creation  Act of 2004  (the  "Jobs  Act") on
enterprises'  income tax expense and  deferred tax  liability.  The Jobs Act was
enacted on October 22, 2004. FSP 109-2 states that an enterprise is allowed time
beyond the financial reporting period of enactment to evaluate the effect of the
Jobs Act on its plan for  reinvestment or  repatriation of foreign  earnings for
purposes of applying SFAS 109. The Company has not yet completed  evaluating the
impact of the  repatriation  provisions.  Accordingly,  as  provided  for in FSP
109-2, the Company has not adjusted its tax expense or deferred tax liability to
reflect the repatriation provisions of the Jobs Act.

In March 2005, the FASB issued FASB  Interpretation  ("FIN") No. 47, "Accounting
for Conditional Asset Retirement  Obligations." FIN No. 47 clarifies the meaning
of the  term  CONDITIONAL  ASSET  RETIREMENT  OBLIGATION  as used  in SFAS  143,
"Accounting for Asset Retirement Obligations" and clarifies when an entity would
have  sufficient  information to reasonably  estimate the fair value of an asset
retirement obligation. This interpretation is effective no later than the end of
fiscal years ending after December 15, 2005 (December 31, 2005 for calendar-year
companies).  Retrospective  application  of  interim  financial  information  is
permitted but is not required. The adoption of this statement is not expected to
have a material effect on the Company's consolidated financial position, results
of operations or cash flows.

On May 5, 2005, the FASB issued Statement No. 154,  Accounting Changes and Error
Corrections ("SFAS 154"), a replacement of APB Opinion No. 20 and FASB Statement
No. 3. The Statement applies to all voluntary changes in accounting  principles,
and changes the  requirements  for  accounting  for and reporting of a change in
accounting  principle.  SFAS 154  requires  retrospective  application  to prior
periods'  financial  statements of a voluntary  change in  accounting  principle
unless  it is  impracticable.  SFAS 154  requires  that a change  in  method  of
depreciation,  amortization, or depletion for long-lived, nonfinancial assets be
accounted for as a change in accounting estimate that is effected by a change in
accounting  principle.  Opinion  20  previously  required  that such a change be
reported as a change in accounting  principle.  The requirements of SFAS 154 are
effective for accounting  changes made in fiscal years  beginning after December
15,  2005.  The  adoption of this  statement  is not expected to have a material
effect on the Company's consolidated  financial position,  results of operations
or cash flows.

                                      F-13
<PAGE>

NOTE 3.  ACQUISITIONS

On   April   21,   2005,    the   Company    acquired    Strategy   First   Inc.
(www.strategyfirst.com.),   a  leading  developer  and  worldwide  publisher  of
entertainment  software  for  the  PC.  We  acquired  the  company  through  the
jurisdiction  of the Montreal  bankruptcy  court.  As per the  approved  plan of
arrangement,  we paid  consideration to creditors of  approximately  $609,000 in
cash;  we issued  approximately  377,000  shares of Common  Stock;  warrants  to
purchase  200,000  shares of common  stock;  assumed  approximately  $400,000 in
existing  bank debt,  as well as  contingent  consideration  based on the future
profitability of Strategy First.

The costs of the  acquisition  were allocated on the basis of the estimated fair
values of the assets  acquired and  liabilities  assumed.  The  acquisition  was
accounted for as a purchase. The intangible assets identified in connection with
the  acquisition  were recorded (and amortized  where  applicable) in accordance
with the provisions of SFAS No. 142.

        Acquisition cost               $1,370,544
                                       ==========

        Net assets acquired:
           Current assets              $  297,244
           Fixed assets                    82,664
           Goodwill                       764,089
           Intangible assets            1,245,157
                                       ----------
                 Total assets           2,389,154
           Current liabilities            624,183
           Long-term debt                 394,397
                                       ----------
                 Total liabilities      1,018,580
                                       ----------
                                       $1,370,574

NOTE 4.  ACCOUNTS RECEIVABLE

<TABLE>
<CAPTION>
                                                              2005           2004
                                                           ---------      ---------
<S>                                                        <C>            <C>
                Accounts receivable                        $ 253,834      $   1,068
                Less:  provision for returns                (122,080)             -
                Less:  allowance for doubtful accounts       (36,624)             -
                                                           ---------      ---------
                                                           $  95,130      $   1,068
</TABLE>

        NOTE 5.  PROPERTY, PLANT AND EQUIPMENT

                                             2005           2004
                                          ---------      ---------

        Plant and equipment               $ 289,083      $ 204,447
        Motor vehicles                       34,912         34,912
                                          ---------      ---------
                                            323,995        239,359
        Less accumulated depreciation      (209,367)      (189,503)
                                          ---------      ---------
                                          $ 114,628      $  49,856
                                          =========      =========

                                      F-14
<PAGE>

Depreciation  expense was $20,896,  $39,205 and $94,680 for the years ended June
30, 2005, 2004 and 2003,  respectively.  Of this depreciation expense,  $26,252,
was included in discontinued operations for the year ended June 30, 2003.

NOTE 6.  INVESTMENTS IN NON-MARKETABLE SECURITIES

A summary of the investments in  non-marketable  securities on the  consolidated
balance sheet is presented below:

<TABLE>
<CAPTION>
                                                   Effective
                                                   Percentage          As of and for the Year Ended
                                                   Ownership        June 30, 2005       June 30, 2004
                                                    --------          --------            --------
<S>                                               <C>                  <C>                 <C>
        Investments In
           Unconsolidated Affiliates:
              Magnolia Broadband, Inc.            2.9% and 13%         831,066             831,066
              Other                                                     12,500              12,500
                                                                      --------            --------
                                                                      $843,566            $843,566
                                                                      ========            ========
</TABLE>

MAGNOLIA BROADBAND, INC.

On April 14, 2000, the Company purchased  3,447,774 shares of Series A Preferred
stock in Magnolia  Broadband  ("Magnolia"),  for  consideration  of  $2,500,000,
$1,300,000  of which was  recorded as  goodwill.  The  goodwill  relating to the
Company's  investment in Magnolia was being amortized over a three-year  period.
Effective July 1, 2001, the Company  adopted SFAS 142 (see Note 2) at which time
the unamortized balance was $831,066. Such goodwill is no longer being amortized
and at June 30, 2002, such goodwill was not considered impaired.

On March 9, 2001, the Company  loaned  Magnolia  $250,000.  In October 2001, the
Company loaned Magnolia  $200,000,  these notes were converted into new Series A
Preferred Stock in March 2002.

Magnolia  has  successfully  raised over $25 million  since its  inception  from
investors such as SCP Private Equity  Partners,  Draper Fisher Gotham  Ventures,
eCentury  and Intel  Capital.  Despite  its  excellent  technical  achievements,
Magnolia will need to obtain  additional  funding to fund its future  operations
until it achieves revenues and profitability. There is no assurance that it will
be able to do so in the future.

Magnolia  Broadband is a development  stage company  established  to develop and
market wireless based chips primarily for the mobile handset market.

The  Company  initially  invested  in  Magnolia  based on the  track  record  of
Magnolia's  founder,  positive industry feedback together with the results of an
independent  study  commissioned  by the  Company to evaluate  Magnolia's  basic
technological premise and its market applications.

In assessing  the fair value of our  investment  in Magnolia,  we monitor  their
progress  through  monthly  board  meetings and  additional  formal and informal
communications.   Magnolia,   since  inception,  has  set  technical  goals  and
timelines,  which were  invariably  met or surpassed.  Furthermore,  the company
excelled  in hiring  high  level  technical  staff  with  advanced  degrees  and
experience in management of corporations such as Nokia, Bell Labs, Motorola, and
Anadigics.  The willingness of highly qualified individuals to leave established
corporations for a start-up  opportunity  provided  validation for our belief in
Magnolia's  potential.  This promise was further  validated  by the  significant
investments  made by

                                      F-15
<PAGE>


leading venture capital funds in various tranches from 2002 through August 2005,
and by positive  field  trials and  responses  from  potential  customers,  most
notably SK Telecom and Sprint PCS.

Based on  Magnolia's  achievements,  some of which  are  summarized  above,  the
Company  concluded  that these  positive  accomplishments  support the variables
considered in developing the valuations for the private  placement  transactions
which the Company used as a basis for concluding that its investment in Magnolia
was  not  reflected  at a  value  in  excess  of  fair  value  on its  financial
statements.

The Company's ongoing monitoring and evaluation described above continues.  Over
the next twelve  months,  among other  goals,  Magnolia  anticipates  commercial
production  of its first  Chipset  product,  as well as  production  of a second
commercial Chipset product. Furthermore, it plans to have successfully completed
integration of these products into commercial  handsets thereby generating sales
revenue for the first  time.  The Company  will  continue to monitor  Magnolia's
progress and will evaluate the carrying value of its investment based upon these
milestones being met.

In  performing  our analysis of the possible  impairment  of our  investment  in
Magnolia as of June 30, 2003,  2004 and 2005,  we considered  our  investment in
Magnolia in total in accordance with paragraph 19(h) of APB No. 18.

In  performing  our analysis for 2003,  we looked to the $6 million in financing
Magnolia  received  in July  2003  from a  Series  C  Preferred  Stock  Purchase
Agreement  with existing  investors.  Under this  agreement,  Magnolia  received
additional  funds  from  further  sales  of  Series C  Preferred  Stock to these
investors if certain  operational  milestones  were met. The Company  determined
that based on the $6 million funding received from Magnolia in July 2003 and the
progress Magnolia had made in developing its technology and meeting  milestones,
the  Company's  investment in Magnolia was not  considered  impaired at June 30,
2003. We again computed the fair value of our holdings in Magnolia  Broadband by
multiplying  the  number of shares we owned by the July 2003  private  placement
price,  which  resulted in a fair value that was greater than the carrying value
of our investment.

In  performing  our analysis for 2004,  we looked to the $6 million in financing
Magnolia  received  in July  2003  from a  Series  C  Preferred  Stock  Purchase
Agreement with existing investors,  as well as the convertible notes received by
Magnolia in April  2004.  The  Company  determined  that based on the $6 million
funding  received from Magnolia in July 2003 and the terms of the notes, as well
as the  progress  Magnolia had made in  developing  its  technology  and meeting
milestones,  as described  above,  the Company's  investment in Magnolia was not
considered  impaired at June 30, 2004.  We again  computed the fair value of our
holdings in Magnolia  Broadband by multiplying  the number of shares we owned by
the July 2003 private  placement  price, as well as the conversion  price of the
April 2004  Convertible  Note,  which  resulted in a fair value that was greater
than the carrying value of our investment.

In performing our analysis for 2005, we looked to the $13.5 million in financing
Magnolia  received  during  the  fiscal  year from  existing  and major  outside
investors as well as the progress Magnolia had made in developing its technology
and meeting milestones, as described above. The Company's investment in Magnolia
is not considered impaired at June 30, 2005. We again computed the fair value of
our holdings in Magnolia  Broadband by multiplying the number of shares we owned
by the price for shares paid by investors  in the last  placement  round,  which
resulted  in a fair  value  that  was  greater  than the  carrying  value of our
investment.  Additionally  we looked to an  independent  analysis of  Magnolia's
value  performed by a leading  investment bank and concluded from this, as well,
that the fair value of our holdings  was greater than the carrying  value of our
investment.

                                      F-16
<PAGE>

NOTE 7.  LONG-TERM NOTES RECEIVABLE

In connection with the sale of Lifestyle,  which was completed in November 2000,
as well as the earlier sale of two other  subsidiaries,  the Company received as
partial consideration three notes receivable  denominated in South African Rand.
These notes are subject to foreign currency risk and a portion of one is subject
to certain  performance  requirements  of the debtor.  Two of the notes  require
monthly payments ranging from R50,000 ($8,000) to R30,000 ($5,000).  The Company
has received all  scheduled  payments  with respect to the first of these notes,
including  interest  in a timely  fashion.  The  second  note has a  balance  of
approximately  $50,000  outstanding.  The  third  note was for R52  million  ($8
million) of which R20 million ($3.1  million)  (plus accrued  interest) has been
treated as  contingent  consideration  to be recorded  when  collected  as it is
secured only by the debtor's stock in Lifestyle and therefore  collection is not
assured.  R31.4  million  ($4.8  million) of the third  note,  is payable as the
borrower collects on junior debt. In December 2004, the Company received payment
for this R31.4 million  portion of the note.  Further  payments on this note are
dependent on circumstance related to the disposition of the stock that serves as
security for the note.

With respect to the  Lifestyle  note,  the Company's  South African  subsidiary,
First South African Holdings (Pty) Ltd (FSAH) holds the remainder (approximately
$3.5 million) of the original note receivable,  in the face amount of $8,000,000
from Salwin  Investments  (Pty) Ltd, a special purpose  company,  owned by First
Lifestyle Holdings management.  The purpose of the transaction was to enable the
management of First  Lifestyle  Holdings (five  executive  directors) to acquire
shares in First Lifestyle Holdings Limited. Remainder of this note is payable on
the following basis:

      (a)   The  shareholders  of Salwin  can inject  funds into the  company in
            order to reduce the debt, without penalty.

      (b)   Should  Salwin  dispose of its shares in and  claims  against  First
            Lifestyle, the proceeds will be used to settle the Note. If there is
            any shortfall in the proceeds, such amount will be written off.

      (c)   Any  outstanding  liability will  irrevocably  terminate on the 20th
            anniversary of the Note, November 2020.

The  repayment by First  Lifestyle of the junior debt owed to Salwin will at all
times be subject to the  senior  debt  covenants  that  govern the  relationship
between First  Lifestyle and its bankers.  As of June 30, 2005,  the Company had
received  payment from Salwin of R 31.4 million in principal and  interest.  The
Company  continues to accrue interest on the remaining R 18 million)  portion of
the Note that it recorded upon the sale of First Lifestyle The Company  monitors
the  financial  results of First  Lifestyle  Holdings on a quarterly  and annual
basis. It is the Company's opinion that First Lifestyle is generating sufficient
cash flow to meet its senior debt obligations and senior bank covenants and that
the  Lifestyle  shares  securing  the  note  are of  sufficient  value  to cover
repayment of the loan.

Having acquired, owned and operated the South African businesses, the Company is
well acquainted with the First Lifestyle  Group,  its management and its assets.
The cash flow  generated by First  Lifestyle  has enabled it to pay down all its
Junior and Subordinated debt. Going forward,  the management of Lifestyle cannot
realize  value for their shares in Lifestyle  prior to the payment of the Salwin
note. Based on these factors, the Company, has therefore concluded that its note
receivable  from Salwin  will be  collected

                                      F-17
<PAGE>

through the efforts of Lifestyle  management  who will act to secure free access
to their shares in Lifestyle currently  encumbered by the Salwin note agreement.
The timing of full payment on the loan is undetermined.

The Company  has  continued  to accrue  interest on the Salwin Note based on its
calculation  as to the  realizable  value of the  underlying  collateral for the
Note. This analysis includes both objective valuation  calculations,  as well as
more subjective criteria as to the likelihood of Salwin  shareholders  accessing
liquidity  for  their  Lifestyle  shares  in the  medium  term.  There can be no
guarantee that our analysis is correct or that the realizable  value will remain
sufficient  to cover the full amount of the Note.  Should  future  circumstances
dictate a reevaluation of our assumptions, we may cease accruing interest on the
Note or may impair its carrying value.

These  notes  bear  interest  at rates  based on the lower of the South  African
Bankers  Acceptance  rate or 12% (at  June 30,  2005  the  rate  was 7%).  Notes
receivable include accrued interest of approximately $108,067.

                                                    JUNE 30,
                                           2005                   2004
                                        ----------            ----------
        Balance                         $3,254,035            $8,116,253
        Less current portion               118,272               138,704
                                        ----------            ----------
        Long-term portion               $3,135,763            $7,977,549
                                        ==========            ==========


NOTE 8.  INTANGIBLE ASSETS

The components of amortized intangible assets as of June 30, 2005 and 2004 is as
follows:

<TABLE>
<CAPTION>
Balance at June 30, 2005            Gross Carrying   Accumulated
                                         Amount      mortization           Total
                                      ----------      ----------       ----------
<S>                                   <C>             <C>              <C>
        Customer lists                $  215,000      ($ 204,500)      $   10,500
        Game titles                    1,220,802         (20,347)       1,200,455

        Covenant not to compete           32,555          (1,809)          30,746
                                      ----------      ----------       ----------


        Balance at June 30, 2005      $1,468,357      ($ 226,656)      $1,241,701
                                      ==========      ==========       ==========


        Balance at June 30, 2004

        Customer lists                $  215,000      ($ 202,500)      $   12,500
                                      ==========      ==========       ==========
</TABLE>


Amortization  expense for intangible assets was $23,809,  $18,250,  and $112,938
for the  years  ended  June 30,  2005,  2004  and  2003,  respectively.  Of this
amortization  expense $45,938,  was included in discontinued  operations for the
year end of June 30, 2003.

                                      F-18
<PAGE>
Estimated  amortization  expense  for the  five  succeeding  fiscal  years is as
follows:

             2006                                           $134,932
             2007                                           $134,932
             2008                                           $133,123
             2009                                           $124,080
             2010                                           $124,080
             Thereafter                                     $590,554


NOTE 9.  DEBT

LINES OF CREDIT

In June 2002, Fantasy Sports obtained a secured line of credit facility from UBS
for borrowings up to $1.0 million,  which is fully secured against cash balances
held  in the  Company's  account.  This  facility  is due on  demand  and has an
interest rate of 3.0%. The balance outstanding under this line of credit at June
30, 2005 and 2004 was $67,189 and $305,160, respectively.

LONG TERM DEBT

                                          2005            2004
                                       ---------       ---------
        Vehicle loans                  $  10,633       $  16,276
        Working Capital loan             360,259               -
        Capital lease obligations              -          19,240
                                       ---------       ---------
                                         370,892          35,516
        Less current portion            (220,845)        (24,883)
                                       ---------       ---------
        Long-term debt, net            $ 150,047       $  10,633
                                       =========       =========

Scheduled debt  maturities for the next five fiscal years are $220,845 in fiscal
2006 and, $150,047 in fiscal 2007.


NOTE 10. INCOME TAXES

The components of the Company's provision for income taxes were as follows:

                                    2005         2004          2003
                                    ----         ----          ----
          Current:
             Federal            $       -     $     -       $      -
             Foreign                    -           -              -
             State                      -           -              -
                                ----------    --------     ---------
                                        -           -              -
                                ----------    --------     ---------
          Deferred:
             Federal                    -           -              -
             Foreign                    -           -              -
             State                      -           -              -
                                ----------    ---------    ---------
                                        -           -              -
                                ----------    ---------    ---------
                                $       -    $      -      $       -
                                ==========    ========      ========


                                      F-19
<PAGE>

A  reconciliation  of income tax computed at the  statutory  rates to income tax
expense (benefit) is as follows:

<TABLE>
<CAPTION>
<S>                                                            <C>              <C>               <C>
                                                                2005             2004             2003
                                                                ----             ----             ----

          Tax expense at the statutory rate                    $49,432          $340,858          $23,578
          Tax effect on Income (loss) of non-US
             operations                                         61,768          (324,908)        (120,201)
          State and provincial income taxes, net
            of federal income tax                               15,669             1,446           (8,526)
          Change in effective tax rate                        (128,330)                -                -
          Permanent differences                                  3,851               447            7,407
          Valuation allowance                                   (2,390)          (17,843)          97,742
                                                               --------         ---------        --------
                                                         $           -     $           -    $           -
                                                         =============     =============    =============
</TABLE>

At June 30,  2005,  the Company has  available  U.S.  net  operating  loss carry
forwards of approximately  $4,591,581 which expire through 2023 and Canadian net
operating loss carry forwards of  approximately  $3,210,000 which expire through
2013.

In addition to the net operating  loss carry  forward,  the Company had deferred
tax assets which relate  primarily to  amortization of goodwill and fixed assets
recorded at different rates for tax and book purposes,  deferred revenue that is
deferred for book purposes but is recognized when received for tax purposes, and
accrued prize winnings  which is accrued for book purposes but  deductible  when
paid for tax purposes.  As of June 30, 2005 and 2004, a valuation  allowance has
been established against the deferred tax asset since the Company believes it is
more likely than not that that the amounts will not be realized.

The components of the deferred tax assets  (liabilities) were as follows at June
30, 2005 and 2004:

           Current:                                 2005                  2004
                                                    ----                  ----
              Net operating losses           $ 2,763,820           $ 1,717,938
              Accrued prize winnings              91,530                57,062
              Accrued postage                          -                 5,920
              Deferred revenue                   251,699               256,508
                                              ----------            ----------
                                               3,107,049             2,037,428
                                              ----------            ----------
           Long-term:

              Amortization of goodwill          (269,526)             (161,007)
              Depreciation                        53,559                 8,261
                                              ----------            ----------
                                                (215,967)             (152,746)
                                              ----------            ----------
                                               2,891,082             1,884,682
           Total valuation allowance          (2,891,082)           (1,884,682)
                                              ==========            ==========
           Deferred tax asset                $         -           $         -
                                              ==========            ==========

The Silverstar Holdings Limited is a Bermuda registered  corporation where there
are no income tax laws applicable.

                                      F-20
<PAGE>


FSAH, a South African registered corporation,  incurred no income tax charges in
fiscal year 2005 and 2004.

First South Africa  Management  Corp.  Fantasy Sports,  Inc. and Student Sports,
Inc.,  are  U.S.  registered  corporations  and did not  incur  any  income  tax
provision for 2005, 2004 and 2003.

At June 30, 2005, no provision  for income taxes has been made on  approximately
$513,000 of foreign earnings,  which are expected to be reinvested indefinitely.
Upon  distribution of those earnings in the form of dividends or otherwise,  the
Company could be subject to U.S. income taxes (subject to adjustment for foreign
tax credits,  if any),  state income  taxes,  and  withholding  taxes payable to
various foreign countries.  Determination of the amount of unrecognized deferred
U.S. tax liability is not  practicable  because of the  complexities  associated
with this hypothetical calculation.

In  December  2004,  the FASB  issued FASB Staff  Position  ("FSP")  No.  109-2,
"Accounting  and  Disclosure  Guidance  for the  Foreign  Earnings  Repatriation
Provision  with the  American  Jobs  Creation  Act of 2004" ("FSP  109-2"),  The
American Jobs Creation Act of 2004 (the "Act")  provides for a special  one-time
tax deduction of 85% of certain foreign earnings that are repatriated as defined
in the Act. FASB  Statement No. 109,  "Accounting  for Income  Taxes,"  requires
adjustments of deferred tax  liabilities  and assets for the effects of a change
in tax laws or rates in the period that  includes the  enactment  date.  FSP No.
109-2  provides an exception to allow an  enterprise  time beyond the  financial
reporting  period of enactment to evaluate the effect of the Act on its plan for
reinvestment or  repatriation of foreign  earnings for purposes of applying FASB
Statement No. 109.

The  Company has not yet  completed  evaluating  the impact of the  repatriation
provisions.  Accordingly,  as  provided  for in FSP 109-2,  the  Company has not
adjusted its tax expense or deferred tax  liability to reflect the  repatriation
provisions of the Jobs Act.


NOTE 11.   DISCONTINUED OPERATIONS

STUDENT SPORTS, INC.

On June 10, 2003, the Company sold  substantially all the assets and liabilities
as of May 15, 2003 of Student Sports,  a media company  producing  publications,
television programs and various marketing initiatives for the high school sports
market.  The  purchaser  is an  entity  controlled  by some,  but not all of the
stockholders  from  which the  Company  originally  acquired  Student  Sports in
September 2001. Those  stockholders who participated in the repurchase agreed to
surrender  the right to  receive  shares of  Company  common  stock  which  they
received as contingent  consideration  in the Company's  acquisition  of Student
Sports. As a result, an obligation to issue approximately 914,000 common shares,
valued at  approximately  $492,000 has been included as a liability  relieved in
connection  with the sale in the  calculation  of the loss  associated  with the
disposition. The calculation of loss from disposition also includes the value of
the Company  common stock  returned,  as well as the cash paid. A summary of the
calculation of the loss on disposition is approximately as follows:

        Cash received                                 $   1,000
        Common stock returned                           231,000
        Liability to issue common stock relieved        492,000
                                                      ---------
           Total consideration                          724,000
        Net book value transferred                     (987,000)
                                                      ---------
        Loss on disposition                           $(263,000)
                                                      =========


                                      F-21
<PAGE>

In September 2001 when Student Sports was acquired,  a commitment to issue up to
1,500,000 shares of Company common stock, at the lower of $3.00 per share or the
market price of the stock,  not to exceed  $1,500,000 was entered into. The only
contingency  for the  issuance  of the  shares was time.  The shares  were to be
issued on March 31, 2004.  Pursuant to EITF 97-15, the contingent  consideration
was  recorded  at the  date of  acquisition  as a  liability  of  $807,000,  the
1,500,000  shares at 80% ($0.538 per share) of the average  market value for the
20 trading  days prior to closing.  The  remaining  liability  to issue  shares,
included  as  a  liability  in  the  accompanying   consolidated  balance  sheet
($223,559)  represents  the  obligation  to issue common  shares to those rights
holders who did not surrender their rights.

Those rights that were not  surrendered  entitle the holders to receive  Company
common stock on March 31, 2004.  The Company is currently  negotiating  with the
remaining  rights  holders  in an effort to reduce or  eliminate  the  number of
common  shares that the Company  must issue in  connection  with the  contingent
consideration in light of the poor performance of Student Sports.

In accordance with accounting principles generally accepted in the United States
of America, the operating results and net assets related to Student Sports, Inc.
have been included in  discontinued  operations  in the  company's  consolidated
statements of operations and consolidated balance sheets.

The following  summarizes the operating results of Student Sports,  discontinued
operations:

                                         ELEVEN MONTHS
                                              ENDED
                                             MAY 15,
                                              2003
                                          ===========
        Revenue                           $ 1,285,065
                                          ===========
        Operating loss                    $ ( 736,947)
                                          ===========
        Loss on disposal                  $  (262,754)
                                          ===========


                  CALCULATION OF LOSS ON SALE OF STUDENT SPORTS

Book value of assets transferred                          $ 1,487,245
Cost of shares issued at acquisition                          175,220

Liabilities transferred                                      (501,660)
Liability to issue shares relieved, at cost                  (666,814)
Common shares returned at fair value on date of sale         (231,237)
                                                          -----------

      Loss on disposition                                 $   262,754
                                                          ===========


                                      F-22
<PAGE>

NOTE 12: CASH FLOWS

Changes in operating assets and liabilities consist of the following:

<TABLE>
<CAPTION>
                                                                                           2005            2004           2003
                                                                                        ----------      ---------       ---------
<S>                                                                                     <C>             <C>             <C>
          Decrease (increase) in accounts receivable                                    $  (44,120)     $  16,748       $   5,413
          Decrease (increase) in inventories                                                18,845        148,734         (46,483)
          Decrease (increase) in prepaid expenses and
            current assets                                                                  (2,115)        83,425         (20,010)
          Increase (decrease) in overdraft                                                       -           (567)            567
          (Decrease) increase in accounts payable                                         (169,746)      (255,867)        222,480
          (Decrease) increase in accrued expenses and
             deferred revenue                                                              (33,212)      (199,186)         31,294
                                                                                        ----------      ---------       ---------

                                                                                        $ (230,348)     $(206,713)      $ 193,261
                                                                                        ==========      =========       =========

          Net cash  provided  used  in  discontinued  operations
             consists  of the following:
                Net loss of discontinued operations                                     $      -       $        -       $(999,700)
                Impairment of intangible assets                                                  -              -         322,000
                Depreciation and amortization                                                    -              -          72,190
                Bad debts expense                                                                -              -           3,700
                Changes in operating accounts                                                    -              -         113,481
                 Loss on Disposal of Fixed Assets                                                -              -           6,502
                Acquisition of property plant and equipment                                      -              -         (21,207)
                Short - term borrowings -net                                                     -              -          96,045
                Repayment of long term debt                                                      -              -         (14,812)
                Proceeds from equipment loans                                                    -              -         322,000
             Cash (included in)  from net assets from
              discontinued operations                                                            -              -               -
                Net loss on sale of assets                                                       -              -         174,801
                                                                                        ----------      ---------       ---------
                                                                                        $      -        $     -       ($247,000)
                                                                                        ----------      ---------       ---------

          Non-cash investing and financing activities:
             Conversion of Class B shares to common
             Shares                                                                     $      613      $     500       $       -
                                                                                        ==========      =========       =========
             Retirement of treasury shares                                              $               $       -       $  25,135
                                                                                        ==========      =========       =========
             Financing of vehicle purchase                                              $                $      -       $  22,800
                                                                                        ==========      =========       =========
             Warrants issued for acquisition                                            $               $       -       $       -
                                                                                        ==========      =========       =========
             Stock issued for acquisition                                               $  167,400      $       -       $       -
                                                                                        ==========      =========       =========
                                                                                        $  517,676      $       -       $       -
                                                                                        ==========      =========       =========
         Issuance of debt for acquisition                                               $  394,395      $       -       $       -
                                                                                        ==========      =========       =========
</TABLE>


NOTE 13.  BUSINESS SEGMENT INFORMATION

As a result of the acquisition of Strategy First on April 21, 2005 (see Note 3),
the Company now operates in two segments -  entertainment  software and internet
fantasy sports games. The operations of the entertainment software specialize in
the  publishing  of software  games for the PC platform  The  operations

                                      F-23
<PAGE>

of the  Internet  fantasy  sports games  segment  specialize  in  Internet-based
subscriptions  for NASCAR,  college  football and  basketball  and other fantasy
sports  games.   Management  has  chosen  to  organize  the  enterprise   around
differences in products and services it provides.

During fiscal year 2003 the Company had two reportable segments,  which included
strategic  business units that offered  different  products and services.  These
business  units were managed  separately as Student  Sports  provided  marketing
services and Fantasy  Sports  provided  entertainment  services.  As the company
changed its focus,  the Company  sold Student  Sports  which is therefore  being
reported as discontinued operations.  As a result, continuing operations for the
fiscal  years  ending June 30, 2004 and June 30, 2003  reflect  that the company
operated in only one segment, consisting of fantasy sports games.

Information concerning  identifiable assets as of June 30, 2005 and 2004 for the
segments  in which  the  Company  operated  are  shown in the  following  table.
Corporate assets are principally cash and notes receivable.

                                              YEAR ENDED JUNE 30,
IDENTIFIABLE ASSETS:                         2005             2004
                                         -----------      -----------
Segments:

     Entertainment software              $ 2,345,845      $         -
      Internet fantasy sports games        3,195,566        3,230,867
                                         -----------      -----------
                                           5,541,411        3,230,867
      Corporate                            9,159,054       10,034,591
                                         -----------      -----------

Consolidated Totals                      $14,700,465      $13,265,458
                                         ===========      ===========




EXPENDITURES FOR ADDITIONS TO LONG-LIVED ASSETS:        2005          2004
                                                      --------      --------
Segments:

     Entertainment software                           $685,000      $      -
      Internet fantasy sports games                          -           542
                                                      --------      --------
                                                       685,000           542
      Corporate                                        190,267             -
                                                      --------      --------

Consolidated Totals                                   $875,426      $    542
                                                      ========      ========


                                      F-24
<PAGE>

 SILVERSTAR HOLDINGS, LTD. AND SUBSIDIARIES

                    YEARS ENDED JUNE 30, 2005, 2004 AND 2003

<TABLE>
<CAPTION>
                                                                                 YEAR ENDED JUNE 30,
                                                                      2005              2004             2003
                                                                   -----------       -----------       -----------
<S>                                                                <C>           <C>               <C>
Revenues:
Segments:
          Entertainment Software                                   $   353,343   $             -       $         -
          Internet Fantasy Sports Game                               1,945,911         2,367,463         3,141,448
                                                                   -----------       -----------       -----------

Consolidated Totals                                                $ 2,299,254       $ 2,367,463       $ 3,141,448
                                                                   ===========       ===========       ===========
Income (loss) from continuing operations before income taxes:

Segments:
      Entertainment software                                       $    (2,343)      $         -       $         -
      Internet Fantasy Sports game                                     436,613            72,937          (304,545)
                                                                   -----------       -----------       -----------
                                                                       434,270            72,937          (304,545)
                                                                   ===========       ===========       ===========

Corporate:

      Corporate general and administrative                          (1,078,383)         (945,276)       (1,010,089)
      Other income (expense)                                           158,043            11,801           (17,443)
      Foreign currency gains (losses)                                  81,773         1,287,291         1,763,115
      Internet income                                                  586,830           628,727           650,329
      Interest expense                                                 (23,695)          (25,385)          (12,318)

Income (loss) from continuing operations                           $   158,838       $ 1,030,105       $ 1,069,049
                                                                   -----------       -----------       -----------

Discontinued operations:

      Loss from operations                                                   -           (27,582)         (736,947)
      Loss on disposition                                                    -                 -          (262,754)
                                                                   -----------       -----------       -----------
Net Income                                                         $   158,838       $ 1,002,523       $    69,348
                                                                   ===========       ===========       ===========
</TABLE>

                                      F-25
<PAGE>

NOTE 14. STOCK OPTION PLAN

The Board of Directors  has adopted the  Company's  1995 Stock Option Plan.  The
Stock  Option  Plans  provide for the grant of (i) options  that are intended to
qualify as  incentive  stock  options  ("Incentive  Stock  Options")  within the
meaning of Section 422 of the Internal  Revenue Code to key  employees  and (ii)
options  not so  intended  to  qualify  ("Nonqualified  Stock  Options")  to key
employees (including directors and officers who are employees of the Company and
to directors).

The Stock  Option Plans is  administered  by the  Compensation  Committee of the
Board of  Directors.  The  committee  shall  determine  the terms of the options
exercised,  including the exercise  price,  the number of shares  subject to the
option and the terms and  conditions of exercise.  No options  granted under the
Stock Option Plan are transferable by the optionee other than by the will or the
laws of descent and distribution.

The exercise price of Incentive  Stock Options granted under the plan must be at
least  equal to the fair  market  value of such  shares on the date of the grant
(110% of fair market  value in the case of an optionee  who owns or is deemed to
own more than 10% of the voting rights of the  outstanding  capital stock of the
Company or any of its  subsidiaries).  The maximum term for each Incentive Stock
Option  granted is ten years (five years in the case of an optionee  who owns or
is deemed to own more than 10% of the voting rights of the  outstanding  capital
stock of the Company or any of its  subsidiaries).  Options shall be exercisable
at such times and in such  installments  as the  committee  shall provide in the
terms of each individual  option. The maximum number of shares for which options
may be granted to any individual in any fiscal year is 210,000.

The Stock Option Plans also  contains an automatic  option grant program for the
Directors.  Each  person who is  director  of the  Company  following  an annual
meeting  of  shareholders  will  automatically  be  granted  an  option  for  an
additional 15,000 shares of common stock. Each grant will have an exercise price
per share equal to the fair market  value of the common  stock on the grant date
and will have a term of five  years  measured  from the grant  date,  subject to
earlier termination if an optionee's service as a board member is terminated for
cause.

The Company,  through June 30, 2005, has granted  options to purchase  1,371,666
shares of common  stock  under the Plans,  of which  160,000  options  have been
exercised and 90,000 options expired unexercised.

2004 STOCK INCENTIVE PLAN

The  Company's  board of directors  has adopted and the  Company's  shareholders
approved the Company's  2004 Stock  Incentive  Plan (the "2004 Plan").  The 2004
Plan is intended  to provide an  incentive  to  employees  (including  executive
officers),  and directors of and  consultants to the Company and its affiliates,
and is intended to be the  successor  plan to the 1995 Stock  Option Plan (which
terminates in November 2005). The 2004 Plan authorizes the issuance of a maximum
of 1,000,000  shares of the  Company's  common stock  (subject to  adjustment as
described  in the 2004 Plan)  pursuant  to stock  grants or options to  purchase
common stock to employees  (including  officers and directors who are employees)
and non-employee directors of, and consultants to, us.

         The 2004 Plan provides for the grant of (i)  "incentive  stock options"
("ISOs")  within the meaning of Section  422(b) of the Internal  Revenue Code of
1986, as amended (the "Code"), (ii) non-qualified stock options (which are stock
options that do not qualify as ISOs), and (iii) stock awards.

         The 2004  Plan will be  administered  by our  board of  directors  or a
committee of the Company's board of directors consisting of at least two members
of the Company's  board,  each of whom is a "non-

                                      F-26
<PAGE>

employee  director"  within  the  meaning of Rule  16b-3  promulgated  under the
Securities  Exchange Act of 1934.  It is also  intended  that each member of any
such  committee  will be an  "outside  director"  within the  meaning of Section
162(m) of the Code.

         Options  granted  under the 2004 Plan will be subject  to,  among other
things, the following terms and conditions:

            o     The exercise  price of each option will be  determined  by the
                  administrator;  provided,  however, that the exercise price of
                  an ISO may not be less  than  the  fair  market  value  of our
                  common  stock on the date of grant  (110% of such fair  market
                  value if the optionee owns (or is deemed to own) more than 10%
                  of our voting power).

            o     Options   may  be  granted   for  terms   determined   by  the
                  administrator;  provided, however, that the term of an ISO may
                  not  exceed  10 years (5  years  if the  optionee  owns (or is
                  deemed to own) more than 10% of our voting power).

            o     The maximum number of shares of the Company's common stock for
                  which  options may be granted to an  employee in any  calendar
                  year is 230,000. In addition,  the aggregate fair market value
                  of shares  with  respect  to which  ISOs may be  granted to an
                  employee which are  exercisable  for the first time during any
                  calendar year may not exceed $100,000.

            o     The  exercise  price of each  option is  payable  in full upon
                  exercise or, if the applicable  stock option contract  entered
                  into by us with an optionee permits, in installments.

            o     Options  may not be  transferred  other than by will or by the
                  laws of descent and distribution,  and may be exercised during
                  the  optionee's  lifetime  only by the  optionee or his or her
                  legal representatives.

            o     Except as may otherwise be provided in the  applicable  option
                  contract,  if  the  optionee's  relationship  with  us  as  an
                  employee or  consultant  is  terminated  for any reason (other
                  than the death or disability of the optionee),  the option may
                  be  exercised,  to  the  extent  exercisable  at the  time  of
                  termination   of  such   relationship,   within  three  months
                  thereafter,  but in no event after the  expiration of the term
                  of the option.

            o     The Company's may withhold cash and/or shares of the Company's
                  common  stock  having an  aggregate  value equal to the amount
                  which we determine is  necessary  to meet its  obligations  to
                  withhold  any  federal,  state  and/or  local  taxes  or other
                  amounts  incurred  by reason of the  grant or  exercise  of an
                  option,  its disposition or the disposition of shares acquired
                  upon the  exercise of the option.  Alternatively,  the Company
                  may  require  the  optionee  to pay us such  amount,  in cash,
                  promptly upon demand.

The Company,  through June 30, 2005, has granted  options to purchase  1,371,666
shares of common  stock  under the Plans,  of which  160,000  options  have been
exercised and 90,000 options expired unexercised.


                                      F-27
<PAGE>

                                                SHARES         WEIGHTED
                                              SUBJECT TO       AVERAGE
                                               OPTIONS      EXERCISE PRICE
                                             OUTSTANDING      PER OPTION

         Balance at June 30, 2002             1,813,333          3.35

         Granted - plan options                  45,000          0.16
         Expired - plan options                 (30,000)         6.00
         Terminated - non- plan options        (365,000)        (2.58)
                                              ---------
         Balance at June 30, 2003             1,463,333          3.39
                                              ---------

         Granted - plan options                  60,000          1.61
         Expired - plan options                (145,000)         0.79
         Expired - non-plan options             (35,000)         0.35
         Terminated - non- plan options        (130,000)         3.77
         Terminated - plan options              (20,000)         2.19
                                              ---------
         Balance at June 30, 2004             1,193,333          3.68
                                              ---------

         PART III. GRANTED OPTIONS
         Granted non-plan options               450,000          2.00
         Granted-plan options                   390,000          1.37

         PART IV.  EXERCISED OPTIONS            (15,000)         0.43

         Expired - plan options                 (40,000)         5.13
         Expired - non-plan options            (433,333)         4.08
         Terminated - non- plan options
         Terminated - plan options

         Balance at June 30, 2005             1,545,000          2.49

Significant  option  groups  outstanding  at June 30, 2005 and related  weighted
average exercise price and weighted average remaining life are as follows:

<TABLE>
<CAPTION>
                    OPTIONS OUTSTANDING AND EXERCISABLE
           ---------------------- -------------- ----------------- -------------------------
                                                     WEIGHTED              WEIGHTED
                 RANGE OF                            AVERAGE               AVERAGE
                 EXERCISE                            EXERCISE             REMAINING
                  PRICES             SHARES           PRICE            LIFE (IN YEARS)
           ---------------------- -------------- ----------------- -------------------------
<S>           <C>                   <C>              <C>                    <C>
              Less than $1.00        125,000          $0.46                  1.42
              $1.00 to $2.19         770,000           1.72                  3.76
              $3.75 to $4.88         250,000           4.75                  2.00
              $5.00 to $6.00         200,000           5.00                  0.60
                                   ---------
                                   1,345,000
</TABLE>

The Company has also issued  options  during 2001 to an employee to acquire 4.45
shares of Fantasy  common  stock for $47,191  per share.  These  options  vested
immediately  and had a life of  three  years.

                                      F-28
<PAGE>

The fair value of this option  utilizing the Black Scholes  option pricing model
amounted  to $6,451  per  share.  The  assumptions  used in this  model  were as
follows:  risk-free  interest  rate  4.96%;  expected  life  3  years;  expected
volatility 0.0%; and expected dividend yield of 0.0%. This option expired during
the first quarter of fiscal 2004.

NOTE 15.  WARRANTS OUTSTANDING

In consideration for the capital raising activities  undertaken during 2000, the
Company  issued  warrants  to  purchase  150,000  shares of  common  stock at an
exercise price of $0.01 per share.

During fiscal 2001,  Fantasy  issued  warrants to acquire 4.68 shares of Fantasy
common  stock with an exercise  price of $47,191  per share to TWI  Interactive,
Inc, (see Note 21).

These warrants were issued in connection  with a contract to perform  consulting
services.  Compensation  recorded  pursuant to that  contract  includes the fair
value of these warrants. These warrants vest immediately and have a life of four
years.  The fair value of these  warrants,  which was  determined  utilizing the
Back-Scholes pricing model,  amounted to approximately $8,400 per share, a total
of  approximately  $39,300.  The assumptions used in this model were as follows:
risk free interest rate 4.96%;  expected life 4 years; expected volatility 0.0%;
and expected dividend yield 0.0%.

In July 2004,  180,000 warrants to purchase one share of Class A common stock at
an exercise  price of $0.81 per share were granted to a consultant  for services
to be rendered.  These  warrants were valued at $115,210  using a  Black-Scholes
pricing model with the  following  assumptions:  expected  volatility of 142%; a
risk-free interest rate of 3.19% and an expected life of three years. An expense
has been  recognized  for the  fair  value of  these  warrants  granted  to such
non-employees  in the amounts of $32,000 for fiscal year 2005.  Effective May 1,
2005 the  consultant  was  appointed  to the  Board at  Strategy  First  and the
remainder of his options  valued at $83,210  vested  immediately.  These options
were  included in  compensation  expense  deducted  from income from  continuing
operations as prescribed by Accounting Principles Board Opinion #25.

In April 2005, 200,000 warrants to purchase one share of Class A common stock at
an  exercise  price of $2.50 per share were  granted to former  shareholders  of
Strategy  First  as  part  of the  consideration  paid in  connection  with  the
acquisition  of that company.  These  warrants  were valued at $167,400  using a
Black-Scholes pricing model with the following assumptions:  expected volatility
of 126%; a risk-free interest rate of 3.77% and an expected life of three years.
These warrants vest immediately.


                                      F-29
<PAGE>

Warrants outstanding at June 30, 2005 were as follows:

<TABLE>
<CAPTION>
         SILVERSTAR HOLDINGS, LTD.

                                            Number of    Exercise      Expiration
                      Warrant                Warrants     Price           Date                   Entitlement
                      -------                --------     -----           ----                   -----------
<S>                                           <C>         <C>        <C>              <C>
         Debenture Warrants 2001              52,189      $6.00      July 31, 2007    One share of common stock

         Capital Raising Warrants            150,000      $6.00      July 31, 2007    One share of common stock

         Warrants issued for consulting
         services                            180,000      $0.81      July 31, 2007    One share of common stock

         Warrants issued for acquisition
                                             200,000      $2.50      April 21, 2008   One share of common stock
</TABLE>


NOTE 16. COMMITMENTS, CONTINGENCIES AND OTHER MATTERS

LEASES

The Company leases office facilities and various equipment under  non-cancelable
operating  leases,  expiring through January 2006. Office facility and equipment
rent  expense  included in  continuing  operations  for the years ended June 30,
2005,  2004  and  2003  was   approximately   $86,000,   $95,000  and  $137,000,
respectively.

Approximate  future  minimum  lease  payments  under  non-cancelable  office and
equipment lease agreements are as follows:

 YEAR ENDING JUNE 30:

         2006                      114,946
         2007                       45,686
         2008                       18,514
         2009                            -
         2010                            -
                                  --------
                                  $179,146
                                  ========

LITIGATION

The Company, from time to time, is involved in various litigation arising in the
ordinary  course  of  business.   Based  on  currently  available   information,
management  believes that there are no pending  claims that will have a material
adverse effect on the Company's operating results or financial position.

EMPLOYMENT AGREEMENTS

SILVERSTAR HOLDINGS LTD.

On January 29, 2005,  the  Company's  Board of Directors  approved an Employment
Agreement with Clive  Kabatznik (the  "Employment  Agreement").  Pursuant to the
Employment  Agreement,  Mr. Kabatznik will serve as the Chief Executive Officer,
President and Chief Financial  Officer of the Company beginning as

                                      F-30
<PAGE>

of January 1, 2005 and  continuing  through  and until  December  31,  2009.  As
compensation for his services,  Mr. Kabatznik will receive an annual base salary
of $325,000  increasing by $10,000 in 2006 and  increasing to $350,000 per annum
from the beginning of 2007 to the end of 2009. During the term of the agreement,
the employee  shall be entitled to an annual bonus in an amount to be determined
by the Company's Board of Directors and Compensation  Committee based on results
of  operations  of the Company for each fiscal year  starting in the fiscal year
ending June 30, 2006.  Such bonus will be dependant on the  Company's net income
from  operations  achieving  a rate of  return  on  equity  of not less than 20%
annually.

STRATEGY FIRST, INC

On April 21, 2005, Strategy First, Inc., entered into employment agreements with
Don McFatridge, Brian Clarke and Richard Therrien. The employment agreements are
on an at-will basis and call for salaries of $Cdn  180,000,  160,000 and 75,000,
respectively  Each  employee is entitled to a bonus of up to 30% of their salary
at the  discretion  of  Silverstar  Holdings.  Mr.  McFatridge  serves  as Chief
Executive  Officer of  Strategy  First and  received  options to acquire  75,000
shares of Silverstar  Holdings Common Stock.  These options vest annually over a
three-year  period.  Mr.  Clarke serves as Chief  Operating  Officer of Strategy
First and  received  options to acquire  75,000  shares of  Silverstar  Holdings
Common Stock. These options vest annually over a three-year period. Mr. Therrien
serves as Chief  Technology  Officer of Strategy  First and received  options to
acquire 25,000 shares of Silverstar  Holdings  Common Stock.  These options vest
annually over a three-year period.

OTHER

South  African  Secondary  Tax on Companies at 12.5% is payable on all dividends
declared out of distributable reserves of South African companies. There were no
dividends of this nature declared in 2005, 2004 or 2003.

During  2005,  the Company  entered into  various  contracts  with web based and
non-web based  companies  whereby these companies will direct their customers to
the  Fantasycup.com  website.  For those customers that register for the fantasy
league through the website,  the Company will pay commissions  ranging from 7.5%
to 50% of net revenues depending on the terms of each individual agreement.  The
term of  these  agreements  are for one  year and are  renewed  annually  unless
terminated by either party.

In June 2001, the Company entered into an agreement with TWI  Interactive,  Inc.
(TWI), the online arm of International Management Group (IMG). The agreement was
designed to assist Fantasy in establishing  itself as the premier,  independent,
subscription-based  fantasy sports game producer. TWI and affiliates of IMG will
provide  exclusive  representation  and services  across a broad spectrum of its
sports  marketing  activities.  Under the agreement,  the Company will pay TWI a
monthly fee of $12,000 and  commissions of 20% to 50% of net revenues  generated
as a result of the services provided by TWI. The agreement also provides for TWI
to receive a four-year warrant to acquire 4.68 shares of Fantasy common stock at
$47,191 per share.  There was no charge to operations in 2001 for the fair value
of the warrants since the amount was not considered material. This agreement was
terminated  in June 2002,  and the  warrants  expired on June 21, 2005 (see Note
16).

On October 7, 2002,  Fantasy  Sports  entered into an agreement with Sports Team
Analysis  and Tracking  Systems of  Missouri,  Inc.  ("STATS").  This  agreement
subsequently  modified  on July 21,  2003,  calls for STATS to provide  hosting,
programming,  customer  service and marketing  services for Fantasy  Sports.  In
consideration  for these  services,  Fantasy pays STATS an amount of $23,500 per
month, This agreement expires December 31, 2005.


                                      F-31
<PAGE>

NOTE 17.  QUARTERLY INFORMATION (UNAUDITED)

<TABLE>
<CAPTION>
                                                                         QUARTERS ENDED
                                                         -------------------------------------------------------       ---------
                                                       SEPTEMBER 30,   DECEMBER 31,     MARCH 31,      JUNE 30,
                                                            2004           2004          2005            2005            TOTAL
                                                         ---------      ---------      ---------       ---------       ---------
<S>                                                    <C>            <C>            <C>             <C>             <C>
         Revenues                                      $   610,335    $   505,300    $   249,851     $   933,768     $ 2,299,254


         Income  from continuing operations                125,283        787,207       (646,849)       (106,803)        158,838


         Net income                                        125,283        787,207       (646,849)       (106,803)        158,838


         Net  income per share:
           Basic                                              0.01           0.09          (0.07)          (0.01)           0.02
           Diluted                                            0.01           0.09          (0.07)          (0.01)           0.02


         Weighted average common stock Outstanding:

           Basic                                         8,695,513      8,695,513      8,746,511       9,026,948       8,791,121
           Diluted                                       9,000,345      9,037,886      8,746,511       9,026,948       9,170,411
</TABLE>


                                      F-32
<PAGE>

ITEM 9.     CHANGES IN AND  DISAGREEMENTS  WITH  ACCOUNTANTS  ON ACCOUNTING  AND
            FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

We maintain  disclosure  controls and procedures that are designed to ensure (1)
that information required to be disclosed by us in the reports we file or submit
under the Securities  Exchange Act of 1934, as amended (the "Exchange  Act"), is
recorded, processed,  summarized, and reported within the time periods specified
in the Securities  and Exchange  Commission's  ("SEC") rules and forms,  and (2)
that  this  information  is  accumulated  and  communicated  to our  management,
including  our  Chief  Executive  Officer  and  Chief  Financial   Officer,   as
appropriate,  to  allow  timely  decisions  regarding  required  disclosure.  In
designing and  evaluating  the disclosure  controls and  procedures,  management
recognizes  that any controls and  procedures,  no matter how well  designed and
operated, can provide only reasonable assurance of achieving the desired control
objectives,  and  management  necessarily  was required to apply its judgment in
evaluating the cost benefit relationship of possible controls and procedures.

Prior to the filing date of this annual report, under the supervision and review
of our Chief  Executive  Officer and Chief  Financial  Officer,  we conducted an
evaluation of the  effectiveness  of the design and operation of our  disclosure
controls  and  procedures  as of the end of the period  covered by this  report.
Based on that  evaluation,  our Chief Executive  Officer and our Chief Financial
Officer have concluded that our disclosure controls and procedures are effective
in  alerting  them in a timely  manner  to  material  information  regarding  us
(including our consolidated subsidiaries) that is required to be included in our
periodic reports to the SEC.

In addition,  there have been no significant changes in our internal controls or
in other  factors  that could  significantly  affect  those  controls  since our
evaluation.  We cannot  assure  you,  however,  that our  system  of  disclosure
controls and  procedures  will always  achieve its stated goals under all future
conditions, no matter how remote.

ITEM 9B.    OTHER INFORMATION

None.


                                      -18-
<PAGE>

PART V.

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS

DIRECTORS AND EXECUTIVE OFFICERS

Our  directors  and our  executive  officers and the  executive  officers of our
subsidiaries, their ages and present position are as follows:

<TABLE>
<CAPTION>
                    NAME                       AGE                                  POSITIONS
     ----------------------------------  ---------------  --------------------------------------------------------------
<S>                                             <C>        <C>
     Michael Levy......................         59         Chairman of the Board
     Clive Kabatznik...................         48         Vice Chairman of the Board, Chief Executive Officer,
                                                           President and Chief Financial Officer
     Cornelius J. Roodt................         46         Director
     John Grippo ......................         49         Director
     Douglas Brisotti .................         37         Director
</TABLE>


MICHAEL  LEVY is our  co-founder  and has  served  as  Chairman  of our Board of
Directors  since our inception in 1995.  Since 1987, Mr. Levy has been the Chief
Executive  Officer  and  Chairman of the Board of Arpac  L.P.,  a  Chicago-based
manufacturer of plastic packaging machinery.

CLIVE KABATZNIK is our co-founder and has served as a director and our President
since inception in 1995 and as our Vice Chairman,  Chief  Executive  Officer and
Chief  Financial  Officer  since  October  1995.  Mr.  Kabatznik  has  served as
President of Colonial  Capital,  Inc. a Miami-based  investment  banking company
that  specializes  in  advising  middle  market  companies  in areas  concerning
mergers, acquisitions, private and public agency funding and debt placements.

CORNELIUS  J.  ROODT has  served as a member  of our  Board of  Directors  since
December 1996 and was appointed Managing Director and Chief Financial Officer of
one of our subsidiaries, First South African Holdings (Pty.) Ltd., in July 1996.
Mr. Roodt was responsible for overseeing all of the South African  operations of
First  South  African  Holdings  (Pty.) Ltd.  Mr.  Roodt led the buyout of First
Lifestyle Holdings and he is currently Chief Executive of the successor company,
First Lifestyle Holdings, (Pty) Ltd. He is no longer an executive officer of any
of our  subsidiaries.  From February  1994 to June 1996,  Mr. Roodt was a senior
partner at Price Waterhouse  Corporate Finance,  South Africa. From January 1991
to January 1994, he was an audit partner at Price Waterhouse, South Africa.

JOHN GRIPPO, has served as a member of our Board of Directors since 2004 and has
been the president of his own financial management  practice,  John Grippo, Inc.
since 2000. His firm provides  services as Chief  Financial  Officer to small to
mid-sized  public  and  private   companies  and  also  provides  other  related
accounting and consulting services.  Prior to that, Mr. Grippo served as for ten
years as a Chief  Financial  Officer to  companies in the  housewares,  electric
vehicles  and  financial  services  industries.  He worked  for five years as an
auditor with Arthur Andersen, LLP, followed by seven years in various accounting
positions in the  financial  services  industry.  He is a member of the New York
Society of Certified Public  Accountants and the American Institute of Certified
Public Accountants.

DOUGLAS  BRISOTTI  has most  recently  served as  president  of the  games/media
division  at  theglobe.com,  an  Internet  communications  corporation,  and its
subsidiaries  including  Chips & Bits, a game  distribution  business;  Computer
Games Magazine,  a consumer print publication for PC games; Now Playing Magazine
a pop  culture  entertainment  print  publication;  and  Computer  Games  Online
(www.cgonline.com)   and  Now  Playing   Online   (www.nowplayingmag.com),   the
magazines' online

                                      -19-
<PAGE>

counterparts.  Prior to theglobe.com,  Mr. Brisotti served as group director for
Yahoo!  Inc.'s Southeast United States and Caribbean  regions.  At Yahoo! he was
primarily  responsible  for strategic  client revenue  relationships,  including
content integration, merchant integration, sponsorships and advertising, as well
as expanding relationship internationally.

All of our directors hold office until their respective  successors are elected,
or until death,  resignation or removal.  Officers hold office until the meeting
of the Board of Directors  following  each Annual  Meeting of  Stockholders  and
until their successors have been chosen and qualified.

AUDIT COMMITTEE OF THE BOARD OF DIRECTORS

Our Board of Directors has a separate audit  committee,.  The audit committee is
composed of Michael Levy,  John Grippo and Cornelius J. Roodt,  each of whom are
independent directors as defined in Rule 10A-3 of the Securities Exchange Act of
1934.  The Board of Directors has  determined  that Messrs Grippo and Roodt meet
the  standards  of an audit  committee  "financial  expert"  as  defined  by the
Sarbanes Oxley Act of 2002.

COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT.

Section  16(a) of the  Securities  Exchange Act of 1934  requires our  executive
officers and directors,  and persons who  beneficially  own more than 10% of our
common  stock,  to file initial  reports of ownership  and reports of changes of
ownership  with the  Securities  and Exchange  Commission  and furnish copies of
those  reports  to us.  Based  solely on a review of the  copies of the  reports
furnished  to us to  date,  or  written  representations  that no  reports  were
required,  we believe that all reports required to be filed by such persons with
respect to our fiscal year ended June 30, 2004 were timely made.

CODE OF ETHICS

The Company's  Board of Directors  adopted a Code of Ethics which applies to all
of the Company's directors, executive officers and employees. A copy of the Code
of Ethics is  available  upon  request  to the  Company's  counsel  at  Troutman
Sanders,  LLP, Chrysler Building,  405 Lexington Avenue, 9th Floor, New York, NY
10174.

ITEM 11.      EXECUTIVE COMPENSATION

The following summary  compensation table sets forth the aggregate  compensation
we paid or accrued to our Chief Executive  Officer during the fiscal years ended
June 30, 2003,  June 30, 2004 and June 30, 2005.  Apart from our Chief Executive
Officer, whose annual salary is $325,000,  none of our executive officers of any
of our  subsidiaries  received  compensation  in excess of  $100,000  during the
fiscal year ended June 30, 2005.


                                      -20-
<PAGE>
<TABLE>
<CAPTION>
                                                      SUMMARY COMPENSATION TABLE
--------------------------------------------------------------------------------------------------------------------------
                                             ANNUAL COMPENSATION                               LONG TERM COMPENSATION
                                             -------------------                               ----------------------
NAME AND                     FISCAL
PRINCIPAL POSITION           YEAR                                                                               SECURITIES
                             ENDED              SALARY         BONUS         OTHER ANNUAL       RESTRICTED      UNDERLYING
                            JUNE 30,                                         COMPENSATION      STOCK AWARDS    STOCK OPTIONS
------------------          --------            ------         -----        ------------      ------------     -------------
                                                  $              $
<S>                            <C>             <C>                 <C>        <C>              <C>             <C>
Clive Kabatznik,               2005            320,000             0                ---              9,090            515,000
President and Chief            2004            315,000             0                ---                ---              5,000
Executive Officer              2003            315,000             0                                                    5,000
</TABLE>


The  options  granted to Mr.  Kabatznik  during  fiscal year ended June 30, 2005
represent:

.... an option granted under our 1995 Stock Option Plan to purchase 15,000 shares
of our common  stock,  which is currently  exercisable  at an exercise  price of
$1.06 per share;

.... an option granted under our 1995 Stock Option Plan to purchase 50,000 shares
of our common  stock,  which is currently  exercisable  at an exercise  price of
$2.00 per share;

.... a  nonqualified  option  granted to  purchase  450,000  shares of our common
stock, which is currently exercisable at an exercise price of $2.00 per share;

The  options  granted to Mr.  Kabatznik  during  fiscal year ended June 30, 2004
represent:

         o        ... an option  granted  under our 1995  Stock  Option  Plan to
                  purchase 5,000 shares of our common stock,  which is currently
                  exercisable at an exercise price of $1.61 per share;

The  options  granted to Mr.  Kabatznik  during  fiscal year ended June 30, 2003
represent:

         o        ... an option  granted  under our 1995  Stock  Option  Plan to
                  purchase 5,000 shares of our common stock,  which is currently
                  exercisable at an exercise price of $0.16 per share;


                                      -21-
<PAGE>

OPTIONS GRANTED IN FISCAL 2005

         The  following  table  sets forth the  details  of options to  purchase
common stock we granted to our executive  officers during fiscal year ended June
30, 2005,  including  the potential  realized  value over the 5 year term of the
option based on assumed rates of stock  appreciation  of 5% and 10%,  compounded
annually.  These  assumed  rates of  appreciation  comply  with the rules of the
Securities  and Exchange  Commission and do not represent our estimate of future
stock price.  Actual gains, if any, on stock option  exercises will be dependent
on the  future  performance  of our common  stock.  Each  option is  immediately
exercisable.

<TABLE>
<CAPTION>
                                                     OPTIONS GRANTED
                                                     ---------------                                POTENTIAL REALIZABLE
NAME                          NUMBER OF      PERCENT OF TOTAL       PER       EXPIRATION DATE      VALUE AT ASSUMED ANNUAL
                             SECURITIES             TO             SHARE                             RATE OF STOCK PRICE
                             UNDERLYING        EMPLOYEES IN       EXERCISE                              APPRECIATION
                               OPTIONS         FISCAL YEAR         PRICE                               FOR OPTION TERM
---------------------------    -------         -----------         -----      ----------------     ------------------------
                                                                                                      5%            10%
<S>                            <C>                <C>              <C>                   <C>        <C>             <C>
Clive Kabatznik                15,000             2.4%             $1.06        December 18,        $15,000         $21,000
                                                                                   2009

Clive Kabatznik               500,000            81.3%             $2.00        January 31,        $485,000        $693,000
                                                                                    2010
</TABLE>


AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES

         During the fiscal year ended June 30, 2005 no options were exercised by
our executive  officers.  The following table sets forth the number of shares of
our common  stock  underlying  unexercised  stock  options  granted by us to our
executive officers and the value of those options at June 30, 2005. The value of
each  option is based on the  positive  difference,  if any,  of the closing bid
price for our common stock on the Nasdaq  National  Market on June 30, 2005,  or
$1.63, over the exercise price of the option.

<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------
                                  NUMBER OF SECURITIES UNDERLYING       VALUE OF UNEXERCISED IN THE MONEY
                                      UNEXERCISED OPTIONS AT               OPTIONS AT FISCAL YEAR-END
                                          FISCAL YEAR-END
------------------------------------------------------------------------------------------------------------
NAME OF EXECUTIVE OFFICER         EXERCISABLE       UNEXERCISABLE       EXERCISABLE       UNEXERCISABLE
------------------------------- ----------------- ------------------  ---------------- ---------------------
<S>                                 <C>              <C>                  <C>               <C>
Clive Kabatznik                     975,000           -                   $8,650             $-
</TABLE>


DIRECTOR COMPENSATION

Except for Mr. Levy, our directors do not receive fixed  compensation  for their
services as directors other than options to purchase 15,000 shares of our common
stock  granted to each  director  and options to purchase  25,000  shares of our
common stock granted to the Chairman of the Board of  Directors,  and options to
purchase  20,000 shares of our common stock granted to the Chairman of the Audit
Committee,  in each case under our 1995 Stock Option Plan.  Mr. Levy receives an
annual  consulting  fee of $60,000 and options to purchase  25,000 shares of our
common stock per year,  solely in connection with his service as Chairman of our
Board of  Directors.  Additionally,  each  Director  received  9,090  shares  of
restricted   common  stock.   Directors  are  reimbursed  for  their  reasonable
out-of-pocket expenses incurred in connection with their duties.

                                      -22-
<PAGE>

EMPLOYMENT AGREEMENTS

On January 29, 2005,  the  Company's  Board of Directors  approved an Employment
Agreement with Clive  Kabatznik (the  "Employment  Agreement").  Pursuant to the
Employment  Agreement,  Mr. Kabatznik will serve as the Chief Executive Officer,
President and Chief Financial  Officer of the Company beginning as of January 1,
2005 and continuing through and until December 31, 2009. As compensation for his
services,  Mr.  Kabatznik  will  receive  an  annual  base  salary  of  $325,000
increasing  by $10,000 in 2006 and  increasing  to  $350,000  per annum from the
beginning  of 2007 to the end of 2009.  During  the term of the  agreement,  the
employee  shall be entitled to an annual bonus in an amount to be  determined by
the Company's Board of Directors and Compensation  Committee based on results of
operations  of the  Company  for each  fiscal  year  starting in the fiscal year
ending June 30, 2006.  Such bonus will be dependant on the  Company's net income
from  operations  achieving  a rate of  return  on  equity  of not less than 20%
annually.

On November 30, 2000, Fantasy Sports Inc. entered into Employment Agreement with
Gregory S.  Liegey (the  "Employment  Agreement").  Pursuant  to the  Employment
Agreement,  Mr. Liegey served as the Chief Executive Officer,  of Fantasy Sports
Inc. beginning as of November 30, 2000 and continuing through and until November
30, 2003. This agreement was not renewed upon its termination.

On April 21, 2004, Strategy First, Inc., entered into employment agreements with
Don McFatridge, Brian Clarke and Richard Therrien.

The employment  agreements are on an at-will basis and call for salaries of $Cdn
180,000, 160,000 and 75,000, respectively.

Each  employee  is  entitled  to a bonus  of up to 30% of  their  salary  at the
discretion of the board of directors.

Mr.  McFatridge serves as Chief Executive Officer and received 75,000 options to
acquire  Silverstar  Holdings  Common Stock.  These options vest annually over a
three-year period.

Mr.  Clarke serves as Chief  Operating  Officer and received  75,000  options to
acquire  Silverstar  Holdings  Common Stock.  These options vest annually over a
three-year period.

Mr. Therrien serves as Chief  Technology  Officer and received 25,000 options to
acquire  Silverstar  Holdings  Common Stock.  These options vest annually over a
three-year period.

1995 STOCK OPTION PLAN

 Our Board of Directors has adopted and our  shareholders,  prior to our initial
public offering, approved our 1995 Stock Option Plan. Our 1995 Stock Option Plan
provides for the grant of:

o        options that are intended to qualify as incentive  stock options within
         the meaning of Section 422 of the Internal  Revenue Code of 1986 to key
         employees; and

o        options not  intended  to so qualify to key  employees,  including  our
         directors and officers,  and to directors and  consultants  who are not
         employees.

The total number of shares of our common stock for which  options may be granted
under our 1995 Stock Option Plan is 850,000 shares.

Our 1995 Stock Option Plan is administered by the compensation  committee of our
Board of  Directors.  The  compensation  committee  will  determine the terms of
options exercised, including the exercise price, the number of shares subject to
the option and the terms and conditions of exercise. No option granted

                                      -23-
<PAGE>

under our 1995 Stock Option Plan is  transferable  by the optionee other than by
will or the laws of descent  and  distribution  and each  option is  exercisable
during  the  lifetime  of the  optionee  only  by  such  optionee  or his  legal
representatives.

The exercise  price of incentive  stock under our 1995 Stock Option Plan must be
at least  equal to 100% of the fair  market  value of such shares on the date of
grant,  or 110% of fair market  value in the case of an optionee  who owns or is
deemed  to own  stock  possessing  more  than 10% of the  voting  rights  of our
outstanding  capital  stock.  The term of each option will be established by the
compensation  committee,  in its sole discretion.  However, the maximum term for
each  incentive  stock  option  granted  under our 1995 Stock Option Plan is ten
years,  or five  years in the case of an  optionee  who owns or is deemed to own
stock  possessing  more  than  10% of the  total  combined  voting  power of our
outstanding capital stock.  Options will become exercisable at such times and in
such  installments  as the  compensation  committee will provide in the terms of
each  individual  option.  The maximum number of shares for which options may be
granted to any individual in any fiscal year is 210,000.

Our 1995 Stock Option Plan also  contains an automatic  option grant program for
our directors.  Each of our non-employee  directors is automatically  granted an
option to  purchase  10,000  shares of our common  stock  following  each annual
meeting  of  shareholders.  In  addition,  each  of our  employee  directors  is
automatically  granted an option to purchase  5,000  shares of our common  stock
following each annual meeting of shareholders.  Each grant has an exercise price
per share  equal to the fair market  value of the our common  stock on the grant
date, is immediately  exercisable and has a term of five years measured from the
grant date,  subject to earlier  termination if an optionee's service as a Board
member is terminated for cause.

Through  September 28, 2005, we have granted options to purchase  255,000 shares
of our common stock under our 1995 Stock Option Plan, 165,000 of which have been
exercised.

2004 STOCK INCENTIVE PLAN

Our board of directors has adopted and our shareholders  approved our 2004 Stock
Incentive  Plan (the  "2004  Plan").  The 2004 Plan is  intended  to  provide an
incentive to employees  (including  executive  officers),  and  directors of and
consultants  to the  Company  and  its  affiliates,  and is  intended  to be the
successor  plan to the 1995 Stock  Option  Plan  (which  terminates  in November
2005). The 2004 Plan authorizes the issuance of a maximum of 1,000,000 shares of
our common stock  (subject to adjustment as described in the 2004 Plan) pursuant
to stock  grants or options to purchase  common  stock to  employees  (including
officers and directors who are  employees)  and  non-employee  directors of, and
consultants to, us.

         The 2004 Plan provides for the grant of (i)  "incentive  stock options"
("ISOs")  within the meaning of Section  422(b) of the Internal  Revenue Code of
1986, as amended (the "Code"), (ii) non-qualified stock options (which are stock
options that do not qualify as ISOs), and (iii) stock awards.

         The 2004  Plan will be  administered  by our  board of  directors  or a
committee  of our board of directors  consisting  of at least two members of our
board,  each of whom is a  "non-employee  director"  within the  meaning of Rule
16b-3 promulgated under the Securities Exchange Act of 1934. It is also intended
that each member of any such committee will be an "outside  director" within the
meaning of Section 162(m) of the Code.

         Options  granted  under the 2004 Plan will be subject  to,  among other
things, the following terms and conditions:

                                      -24-
<PAGE>

o        The  exercise   price  of  each  option  will  be   determined  by  the
         administrator; provided, however, that the exercise price of an ISO may
         not be less than the fair market  value of our common stock on the date
         of grant (110% of such fair market  value if the  optionee  owns (or is
         deemed to own) more than 10% of our voting power).

o        Options  may be  granted  for terms  determined  by the  administrator;
         provided,  however,  that the term of an ISO may not exceed 10 years (5
         years if the  optionee  owns (or is deemed to own) more than 10% of our
         voting power).

o        The maximum  number of shares of our common stock for which options may
         be granted to an employee in any calendar year is 230,000. In addition,
         the  aggregate  fair market  value of shares with respect to which ISOs
         may be granted to an employee which are  exercisable for the first time
         during any calendar year may not exceed $100,000.

o        The exercise  price of each option is payable in full upon exercise or,
         if the  applicable  stock  option  contract  entered into by us with an
         optionee permits, in installments.

o        Options  may not be  transferred  other  than by will or by the laws of
         descent and  distribution,  and may be exercised  during the optionee's
         lifetime only by the optionee or his or her legal representatives.

o        Except as may otherwise be provided in the applicable  option contract,
         if the optionee's  relationship with us as an employee or consultant is
         terminated  for any reason  (other than the death or  disability of the
         optionee),  the option may be exercised,  to the extent  exercisable at
         the time of  termination  of such  relationship,  within  three  months
         thereafter,  but in no event  after the  expiration  of the term of the
         option.

o        We may  withhold  cash  and/or  shares of our  common  stock  having an
         aggregate  value equal to the amount which we determine is necessary to
         meet its obligations to withhold any federal,  state and/or local taxes
         or other  amounts  incurred  by reason of the grant or  exercise  of an
         option,  its disposition or the disposition of shares acquired upon the
         exercise of the option.  Alternatively,  we may require the optionee to
         pay us such amount, in cash, promptly upon demand.

Through  September 28, 2005, we have granted options to purchase  255,000 shares
of our common stock under our 1995 Stock Option Plan, 165,000 of which have been
exercised.


NON-PLAN STOCK OPTIONS

At various times since 1996, we have granted  non-plan stock options to purchase
1,205,000  shares of our common stock at a weighted  exercise price of $2.97 per
share.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

None of the members of our  compensation  committee of our Board of Directors is
now or ever has been one of our  officers or  employees.  None of our  executive
officers serves as a member of the board of directors or compensation  committee
of any entity that has one or more  executive  officers  serving on our Board of
Directors or our compensation committee.

                                      -25-
<PAGE>

ITEM 12.      SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth, as of August 31, 2005, certain information as to
the beneficial ownership of the our common stock by:

o        each  person  known by us to own more  than  five  percent  (5%) of our
         outstanding shares;

o        each of our directors;

o        each of our executive officers named in the Summary  Compensation Table
         under "Executive Compensation"; and

o        all of our directors and executive officers as a group.

<TABLE>
<CAPTION>
                                       Amount and Nature of Beneficial
                                                Ownership (1)
         ----------------------------- --------------- ----------------- ------ -- ------------- -------------------
                                        Common Stock       Class B                Percentage      Percentage of
         Name and Address of                                Common                    of             Voting
         Beneficial Shareholder                            Stock (2)               Ownership          Power
                                                                                    (1)(3)           (1)(3)
         ----------------------------- --------------- ----------------- ------ -- ------------- -------------------
<S>                                      <C>                <C>                        <C>             <C>
         Michael Levy                    115,090(4)         590,137                    7.8%            25.2%
         9511 West River Street
         Schiller Park, IL 60176
         ----------------------------- --------------- ----------------- ------ -- ------------- -------------------
         Clive Kabatznik                1,163,490(5)       190,000                    14.9%            17.3%
         6100 Glades Road
         Suite 305
         Boca Raton, FL 33434
         ----------------------------- --------------- ----------------- ------ -- ------------- -------------------
         Cornelius J. Roodt              134,090(6)           0                        1.5%             1.1%
         P.O. Box 4001
         Kempton Park
         South Africa
         ----------------------------- --------------- ----------------- ------ -- ------------- -------------------
         Douglas Brisotti                24,090(7)            0                         *                *
         6100 Glades Road
         Suite 305
         Boca Raton, Florida 33434
         ----------------------------- --------------- ----------------- ------ -- ------------- -------------------
         John Grippo                     54,090(8)            0                         *                *
         6100 Glades Road
         Suite 305
         Boca Raton, Florida 33434
         ----------------------------- --------------- ----------------- ------ -- ------------- -------------------
         All executive officers and     1,490,850(9)       780,137                    24.2%            43.6%
         directors as a group (5
         persons)
         ----------------------------- --------------- ----------------- ------ -- ------------- -------------------
</TABLE>

* Less than 1%.

(1)      Beneficial  ownership is calculated in accordance with Rule 13d-3 under
         the Securities  Exchange Act of 1934.  Shares subject to stock options,
         for purposes of this table, are considered  beneficially  owned only to
         the extent  currently  exercisable or exercisable  within 60 days after
         August 31, 2002.

(2)      Except as  otherwise  indicated,  each of the  parties  listed has sole
         voting  and  investment  power  with  respect  to all shares of Class B
         common stock indicated above.

                                      -26-
<PAGE>

(3)      For the purposes of this calculation,  our common stock and our Class B
         common stock are treated as a single class of common stock. Our Class B
         common  stock is entitled  to five votes per share,  whereas our common
         stock is entitled to one vote per share.

(4)      Includes  65,000  shares of our common stock  issuable upon exercise of
         options that are immediately exercisable and 9,090 shares of restricted
         stock.

(5)      Includes  975,000  shares of our common stock issuable upon exercise of
         options that are immediately exercisable and 9,090 shares of restricted
         stock.

(6)      Includes  125,000  shares of our common stock issuable upon exercise of
         options that are immediately exercisable and 9,090 shares of restricted
         stock.

(7)      Includes  15,000 shares of our common stock  issuable upon the exercise
         of  options  that are  immediately  exercisable  and  9,090  shares  of
         restricted stock.

(8)      Includes  45,000  shares  issuable  upon  exercise of options  that are
         immediately exercisable and 9,090 shares of restricted
         stock.

(9)      Includes  1,225,000  shares  issuable upon exercise of options that are
         immediately exercisable and 45,450 shares of restricted stock.


                                      -27-
<PAGE>

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Not applicable.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

         Audit Fees

         Audit fees billed to the  Company by Rachlin  Cohen & Holtz LLP for its
audit of the Company's financial  statements and for its review of the financial
statements  included in the Company's  Quarterly Reports on Form 10-Q filed with
the  Securities and Exchange  Commission  for 2005 and 2004 totaled  $25,953 and
$44,061, respectively.

         Tax Fees

         Tax fees billed to the Company by Rachlin Cohen & Holtz LLP for its tax
returns for the fiscal year 2005 and 2004 were $0, and $0, respectively.

         Other Fees

         No other fees were billed to the  Company by Rachlin  Cohen & Holtz LLP
for all other  non-audit or tax services  rendered to the Company for the fiscal
year 2005 and 2004, respectively.

         Audit Committee Pre-Approval Policies

         The Audit  Committee  has  adopted  a  procedure  under  which all fees
charged  by  Rachlin  Cohen  &  Holtz  LLP  must be  pre-approved  by the  Audit
Committee, subject to certain permitted statutory de minimus exceptions.


                                      -28-
<PAGE>

                                                                PART IV

ITEM 15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K

EXHIBIT INDEX

<TABLE>
<CAPTION>
  EXHIBIT NUMBER       DESCRIPTION
     <S>               <C>
         3.1           Memorandum of Association of the Registrant(2)
         3.2           Bye-Laws of the Registrant(2)
         4.3           Indenture  dated April 25, 1997  between the  Registrant  and American  Stock  Transfer &
                       Trust Company(1)
         4.6           Stock Option Agreement(3)
         10.2          Form of FSAH Escrow Agreement(2)
         10.3          Form of First Amended and Restated Employment Agreement of Clive Kabatznik(2)
         10.4          Form of FSAM Management Agreement(2)
         10.5          Form of Consulting Agreement with Michael Levy(2)
         10.6          1995 Stock Option Plan(2)
         10.7          Asset purchase  agreement by and among First South Africa  Holdings PTY Ltd. and minority
                       shareholders of First Lifestyle  Holdings,  Ltd.,  Ethos Private Equity,  Cornelius Roodt
                       and certain other purchasers and the Company, dated as of September 24, 2000(4)
         10.8          Fantasy Sports Asset Acquisition Agreement dated as of November 17, 2000(5)
         10.9          Agreement  between  Sports Team  Analysis  and  Tracking  Systems of  Missouri,  Inc. and
                       Fantasy Sports Enterprises dated October 7, 2002(5)
         10.10         Amendment to Agreement dated July 21, 2003 between Fantasy Sports  Enterprises,  Inc. and
                       Sports Team Analysis and Tracking Systems of Missouri, Inc.(5)
         10.11         Employment Agreement, dated as of December 31, 2004, between Clive Kabatznik and First
                       South Africa Management Corp. (6).
         10.12         Subscription Agreement, dated February 24, 2005, between the Registrant and Strategy
                       First Inc. (7).
         10.13         2004 Stock Incentive Plan (8)
         21.1          Subsidiaries of the Registrant (8)
         23.1          Consent of Rachlin Cohen and Holtz(6)
         31.1          Certificate Pursuant to Section 302 of the Sarbanes Oxley Act of 2002(8)
         32.1          Certification  Pursuant to 18 U.S.C.  Section 1350 adopted pursuant to Section 906 of the
                       Sarbanes-Oxley Act of 2002(8)
</TABLE>

(1)      Incorporated  by reference to the  Registrant's  Current Report on Form
         8-K filed September 10, 1997.
(2)      Incorporated by reference to the Registrant's Registration Statement on
         Form S-1 (No.  33-99180)  filed on November 9, 1995, as amended on Form
         S-1/A No. 1, Form S-1/A No. 2, Form S-1/A No. 3 filed on  December  27,
         1995, January 16, 1996 and January 24, 1996, respectively and Form 10-Q
         for the fiscal quarter ended March 31, 2000.
(3)      Incorporated by reference is the Registrant's Registration Statement on
         Form S-1 (No.  333-33561)  filed on August 13,  1997 as amended on Form
         S-1/A No. 1, Form S-1/A No. 2 and For S-1/A No. 3 filed on  December 9,
         1997, January 22, 1998 and February 11, 1998, respectively.

                                      -29-
<PAGE>

(4)      Incorporated  by reference to the Company's  Current Report on Form 8-K
         filed on October 12, 2000.
(5)      Incorporated  by reference to the Company's  Current Report on Form 8-K
         filed on December 1, 2000.
(6)      Incorporated  by reference to the  Registrant's  Annual  Report on Form
         10-K for the fiscal  year  ended June 30,  2004.
(7)      Incorporated  by reference to the  Registrant's  Current Report on Form
         8-K filed on April 26,  2005.
(8)      Incorporated  by reference to the  Registrant's  Current Report on Form
         8-K filed on March 1, 2005.
(9)      Filed herewith.


(A)      NONE

         1.  FINANCIAL STATEMENTS

         The following financial statements are included as required to be filed
         by Item 8:

SILVERSTAR HOLDINGS, LTD.

         Report of independent Certified Public Accountant
         Consolidated Balance Sheets at June 30, 2005 and 2004
         Consolidated  Statements  of  Operations  for the years  ended June 30,
         2005, 2004 and 2003 Consolidated Statements of Cash Flows for the years
         ended June 30, 2005, 2004 and 2003
         Consolidated  Statement of  Consolidated  statements  of  stockholders'
         equity and  Comprehensive  loss for the years ended June 30, 2003, 2004
         and 2005 Notes to the Consolidated  Financial  Statements for the years
         ended June 30, 2005, 2004, and 2003

         2.  FINANCIAL STATEMENT SCHEDULES:

         All  schedules  have been  omitted  since the required  information  is
included in the consolidated financial statements or notes thereto.


                                      -30-
<PAGE>

                                   SIGNATURES

         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the  undersigned,  thereunto  duly  authorized in the City of Boca
Raton, State of Florida, on the 28th day of September, 2005.

                                                    SILVERSTAR HOLDINGS, LTD.


                                                    BY:/s/ Clive Kabatznik
                                                       -------------------
                                                        Clive Kabatznik
                                                        President

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  registrant in
the capacities and on the date indicated.

<TABLE>
<CAPTION>
Signature                          Title                                        Date


<S>                                <C>                                          <C>
/s/ Michael Levy                   Chairman of the Board of Directors           September 28, 2005
------------------------------
Michael Levy

/s/ Clive Kabatznik                President, Vice Chairman, Chief              September 28, 2005
------------------------------     Executive Officer, Chief
Clive Kabatznik                    Financial Officer, Director and
                                   Controller


                                   Director
------------------------------
Cornelius Roodt

                                   Director
------------------------------
Douglas Brisotti

/s/ John Grippo                    Director                                     September 28, 2005
------------------------------
John Grippo
</TABLE>


                                      -31-
<PAGE>
<TABLE>
<CAPTION>
                                  EXHIBIT INDEX

  EXHIBIT NUMBER       DESCRIPTION


        <S>           <C>
         3.1           Memorandum of Association of the Registrant(2)
         3.2           Bye-Laws of the Registrant(2)
         4.3           Indenture  dated April 25, 1997  between the  Registrant  and American  Stock  Transfer &
                       Trust Company(1)
         4.6           Stock Option Agreement(3)
         10.2          Form of FSAH Escrow Agreement(2)
         10.3          Form of First Amended and Restated Employment Agreement of Clive Kabatznik(2)
         10.4          Form of FSAM Management Agreement(2)
         10.5          Form of Consulting Agreement with Michael Levy(2)
         10.6          1995 Stock Option Plan(2)
         10.7          Asset purchase  agreement by and among First South Africa  Holdings PTY Ltd. and minority
                       shareholders of First Lifestyle  Holdings,  Ltd.,  Ethos Private Equity,  Cornelius Roodt
                       and certain other purchasers and the Company, dated as of September 24, 2000(4)
         10.8          Fantasy Sports Asset Acquisition Agreement dated as of November 17, 2000(5)
         10.9          Agreement  between  Sports Team  Analysis  and  Tracking  Systems of  Missouri,  Inc. and
                       Fantasy Sports Enterprises dated October 7, 2002(5)
         10.10         Amendment to Agreement dated July 21, 2003 between Fantasy Sports  Enterprises,  Inc. and
                       Sports Team Analysis and Tracking Systems of Missouri, Inc.(5)
         10.11         Employment Agreement, dated as of December 31, 2004, between Clive Kabatznik and First
                       South Africa Management Corp. (6).
         10.12         Subscription Agreement, dated February 24, 2005, between the Registrant and Strategy
                       First Inc. (7).
         10.13         2004 Stock Incentive Plan (8)
         21.1          Subsidiaries of the Registrant (8)
         23.1          Consent of Rachlin Cohen and Holtz(6)
         31.1          Certificate Pursuant to Section 302 of the Sarbanes Oxley Act of 2002(8)
</TABLE>

-----------

(1)      Incorporated  by reference to the  Registrant's  Current Report on Form
         8-K filed September 10, 1997.
(2)      Incorporated by reference to the Registrant's Registration Statement on
         Form S-1 (No.  33-99180)  filed on November 9, 1995, as amended on Form
         S-1/A No. 1, Form S-1/A No. 2, Form S-1/A No. 3 filed on  December  27,
         1995, January 16, 1996 and January 24, 1996, respectively and Form 10-Q
         for the fiscal quarter ended March 31, 2000.
(3)      Incorporated by reference is the Registrant's Registration Statement on
         Form S-1 (No.  333-33561)  filed on August 13,  1997 as amended on Form
         S-1/A No. 1, Form S-1/A No. 2 and For S-1/A No. 3 filed on  December 9,
         1997, January 22, 1998 and February 11, 1998, respectively.
(4)      Incorporated  by reference to the Company's  Current Report on Form 8-K
         filed on October 12, 2000.
(5)      Incorporated  by reference to the Company's  Current Report on Form 8-K
         filed on December 1, 2000.

                                      -32-
<PAGE>

(6)      Incorporated  by reference to the  Registrant's  Annual  Report on Form
         10-K for the fiscal  year  ended June 30,  2004.
(7)      Incorporated  by reference to the  Registrant's  Current Report on Form
         8-K filed on April 26,  2005.
(8)      Incorporated  by reference to the  Registrant's  Current Report on Form
         8-K filed on March 1, 2005.
(9)      Filed herewith.

                                      -33-