SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

                                   FORM 10-K/A

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

         For the fiscal year ended June 30, 2000
                                   -------------

                                       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
                                               --------

                          LEISUREPLANET HOLDINGS, LTD.
               (formerly known as First South Africa Corp., Ltd.)
             --------------------------------------------------
            (Exact name of Registrant as specified in its charter)

                 Bermuda                             N/A
                 -------                             ---
       (State or other jurisdiction of         (I.R.S. Employer
             incorporation or                 Identification No.)
              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, $.01 par value
                               ----------------------------
                                ("Common Stock")

                               Class A Redeemable Warrants
                               ---------------------------
                              ("Class A Warrants")

                               Class B Redeemable Warrants
                               ---------------------------
                              ("Class B Warrants")

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

<PAGE>

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. [ ]

State the aggregate market value of the voting and non-voting common equity held
by  non-affiliates  of the  Registrant.  The  aggregate  market  value  shall be
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 a specified  date within 60
days prior to the date of filing.  (See  definition of affiliate in Rule 405, 17
CFR 230.405).

The  aggregate   market  value  of  the   Registrant's   Common  Stock  held  by
non-affiliates of the Registrant as of October 16, 2000, was $7,065,995.

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

As of October 16, 2000, there were 8,391,899  shares of the Registrant's  Common
Stock  outstanding and 926,025 shares of the  Registrant's  Class B Common Stock
outstanding.


<PAGE>

Part 1

Item 1.  Description of Business

      We are a holding  company  that  seeks to  acquire  controlling  stakes in
Internet  and  technology  related  companies.  We own a  majority  interest  in
Leisureplanet.com.  Leisureplanet.com  is a  provider  of  international  online
travel services for leisure  travelers.  We are also the parent company of First
South African Holdings (Pty.) Ltd. which maintains a majority  interest in First
Lifestyle  Holdings.  First  Lifestyle  Holdings  is the owner of the  companies
through  which we  conduct  our  lifestyle  products  business.  We are also the
largest shareholder in Magnolia Broadband  Wireless,  a startup company which is
developing  fixed wireless  broadband  internet access  products.  We also own a
majority  interest in  Hotelsupplygroup.com,  a startup  company  which plans to
provide various goods and services to hotels worldwide.

HISTORY

      We were founded in September 1995 to pursue  opportunities in South Africa
as an emerging market. We were originally  organized 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.  Recently,  we shifted our focus to
the Internet,  technology and e-commerce  sectors and away from South Africa. We
are currently engaged in the following industry segments:

         o   Internet and e-commerce services and technology; and
         o   Lifestyle products.

      In 2000 we have entered into an agreement to dispose of our  operations in
South Africa. The agreement contemplates our receiving approximately $36 million
in  cash,  which we plan to use to  retire  certain  of our  debt,  fund  future
acquisitions and fund various other corporate purposes. The agreement is subject
to  a  number  of  conditions,  including  obtaining  South  African  regulatory
approvals  and  the  buyer   obtaining   sufficient   funding  to  complete  the
acquisition.  Although we anticipate that these conditions will be met, they are
beyond our control and therefore we cannot be certain that they will be met.

        In  addition,  in July  2000,  Leisureplanet.com  announced  that it had
sought  the  protection  of  the  United  Kingdom  courts  in an  administrative
procedure. Leisureplanet.com had hoped that this protection would facilitate the
renegotiation of its various  co-brand  agreements and give it an opportunity to
seek out a  recapitalization  of the company.  Such a  recapitalization  was not
realized  and as a result,  we have been  forced to write  down the value of our
investment in Leisureplanet.com from $26,203,230 to $0.00.

      As a result of these changes,  and developments we have  reestablished our
investment  criteria.  We aim to  acquire  majority  or  controlling  stakes  in
Internet related  businesses and technology  companies.  These companies must be
either  profitable,  or  reasonably  close  to  profitability.  In the  case  of
technology  companies,  we look for the opportunity to invest definable  amounts
with the expectation of realizing  clearly marked milestones in terms of product
development or marketing goals.

DESCRIPTION OF OUR CORE INDUSTRY SEGMENTS

Internet and E-Commerce Services and Technology

      Through  Leisureplanet.com,   our  international  online  travel  services
company,  we offer our consumers a comprehensive  online leisure travel service,
including  the ability to shop  online for airline  tickets,  hotel  rooms,  car
rentals and cruises.  We have established a database of over 10,000  independent
hotels,  including  60,000 full color  photographs of hotels, a series of travel
guides  covering  186  destinations  in  electronic  format  and a  multilingual
customer call center.  Our proprietary  technology and  user-friendly  interface
enable  customers to easily and quickly access travel  information  seven days a
week.  We  primarily  target our  services  to  consumers  outside of the United
States;  in  particular  in Europe.  We do so by  offering  our  services to our
customers in their own language  and by offering  our users the  opportunity  to
reserve hotel stays in independent hotels such as owner operated hotels and inns
rather than only hotels which  comprise a

                                      -1-
<PAGE>

chain.  We also offer users of our web sites in Europe a large volume of airline
fares that have been specially negotiated by our fulfillment partners in Europe.

      We operate  our own  multilingual  web site at  www.leisureplanet.com.  In
addition, to broaden our online presence and to build brand recognition, we have
entered into various  strategic  relationships to provide a number of co-branded
web sites.  In January 1999, we entered into a three-year  agreement  with Lycos
Bertelsmann  GmbH,  a European  affiliate  of Lycos.  We serve as the  exclusive
travel  retailer  within  the  Lycos  Bertelsmann  travel  web guide in 14 major
European markets,  including France, Germany, the United Kingdom, Italy, Sweden,
Norway, Denmark,  Switzerland,  Austria,  Belgium, The Netherlands,  Luxembourg,
Spain and Finland.  Also, in February 1999, we entered into a two-year agreement
with a subsidiary  of Yahoo!  Inc., a leading  search  engine  provider.  We are
Yahoo!'s  exclusive  provider of airline  flights,  hotel  reservations  and car
rental  bookings  through  a  comprehensive  list of  airlines,  hotels  and car
rentals,  to users  in  France  and  Germany  of  Yahoo!'s  travel  page and our
co-branded  web site with Yahoo!.  In addition,  in June 1999, we entered into a
three-year  agreement with InfoSpace.com,  Inc., a leading aggregator of content
on the Internet.  We serve as the exclusive integrated booking engine for hotel,
air travel,  vacation and cruise packages,  accessible  through  InfoSpace's web
sites.

      For fiscal year ended June 30, 2000, our online travel  services  business
had revenues of approximately $547,000 which accounted for approximately 0.6% of
our revenues.  Our online travel services business had a loss from operations of
approximately $14.6 million for fiscal 2000.

      As a result of these and past losses, in recent months,  Leisureplanet.com
had sought to obtain additional  financing from a variety of sources to fund its
operations,  including from various of its strategic partners. After the failure
of  those   efforts  to  yield   additional   financing,   on  July  26,   2000,
Leisureplanet.com  announced that it had decided to shift its business  strategy
from  business-to-consumer  strategy  to  a  business-to-business  strategy.  In
addition, Leisureplanet.com has sought to renegotiate various of its co-branding
agreements to reduce the expenses associated with those agreements. By doing the
foregoing,  Leisureplanet.com  hopes to lower its expenses and capitalize on its
content and other technology-oriented assets. The company also announced that it
would continue to explore alternatives with various strategic partners,  as well
as  opportunities  for a sale or  merger  of the  company  with  other  industry
players.

      On August 2,  2000,  Leisureplanet.com  announced  that it had  sought the
protection  of  the  United  Kingdom  courts  in  an  administrative  procedure.
Leisureplanet.com   had  hoped  that  this  protection   would   facilitate  the
renegotiation of its various  co-brand  agreements and give it an opportunity to
seek out a  recapitalization  of the company.  Such a  recapitalization  was not
realized and as a result,  we have been forced to write down the entire value of
our investment in Leisureplanet.com from $26,203,230 to $0.00. Our participation
in the online travel business has substantially ended and it is unlikely that we
will make any further investments in the online travel sector in the foreseeable
future.

      On April 14, 2000, we entered into a Securities  Purchase  Agreement  with
Magnolia Broadband, Inc. Magnolia is a start up company that is developing fixed
wireless  broadband  solutions.  Magnolia is seeking to develop  technology  the
provides  residential  and small  business users of the Internet with high speed
access to Internet  services at lower capital costs and with faster  deployment.
Magnolia  will  initially  target its products in the United States and plans to
later penetrate international markets.

      We invested  $2,500,000 in Magnolia and received shares of preferred stock
in Magnolia.  We also  received  board  representation  rights and  registration
rights.  The shares of  Magnolia  preferred  stock we own are  convertible  into
common  stock  of  Magnolia,  and  we  are  entitled  to  voting  rights  on  an
as-converted   basis,   and  certain   preferred   dividend,   liquidation   and
anti-dilution rights. We initially own approximately 48% of Magnolia. Certain of
the shares of the founders of Magnolia are subject to  repurchase by Magnolia if
the founders'  employment  with  Magnolia  terminates  before  October 15, 2002.
Magnolia has  reserved  additional  shares for issuance to founders,  employees,
consultants,  directors  and other  investors.  Assuming  full  issuance of such
shares, our ownership interesting Magnolia will be reduced to 33%.

      We also own 51% of  Hotelsupplygroup.com  a business to business  internet
based e-commerce supplier to the hotel and catering industry. It initially plans
to  market a broad  range of goods to the

                                      -2-
<PAGE>

independent  hotels  currently under contract to  Leisureplanet.com.  The offers
will be  provided  exclusively  to these  hotels  both  through  the  e-commerce
platform,  embodied  at  the  hotelsupplygroup.com  website,  and  through  more
traditional methods such as catalog and other offline marketing campaigns

Our South African Lifestyle Products Operations

      We recently entered into an agreement pursuant to which we disposed of our
operations  in South  Africa.  Under  the  terms of the  agreement  we  received
approximately $36 million in cash, which we plan to use to retire certain of our
debt, fund future  acquisitions and fund various other corporate  purposes.  The
agreement  was  subject to a number of  conditions,  including  obtaining  South
African  regulatory  approvals  and the buyer  obtaining  sufficient  funding to
complete the acquisition, all of which were met.

      Our lifestyle products operations consists of nine companies which operate
as wholly owned  subsidiaries  of First  Lifestyle  Holdings,  a publicly traded
company on the Johannesburg,  South Africa Stock Exchange.  We own approximately
51.5% of First Lifestyle  Holdings.  Of our nine lifestyle  products  companies,
five are engaged in the manufacture of specialty  foods, and four are engaged in
the  manufacture  and  distribution  of a wide  variety  of indoor  and  outdoor
consumer products.

      Piemans  Pantry,  Gull Foods,  Seemanns Meat Products,  Astoria Bakery and
Fifers Bakery are engaged in the  manufacture  of a variety of specialty  foods.
Each of our specialty foods companies is  characterized  by a focus on providing
food  products to the upper end of the market,  with a  significant  emphasis on
quality.  We sell to South Africa's  leading  supermarkets  and retail chains, a
number of fast food  franchises as well as independent  bakeries and convenience
stores.  Piemans  Pantry  manufactures,  sells  and  distributes  quality  meat,
vegetarian  and fruit pies,  both in the baked and frozen,  unbaked  form.  Gull
Foods  manufactures  and sells a wide range of prepared  food  products.  Gull's
product line includes over 150 products ranging from hamburger patties, prepared
sandwiches,  salads,  prepared pastas,  pizzas,  and flavored  breads.  Seemanns
manufactures,  sells,  and  distributes a wide range of processed  meat products
including products typically found in retail butcheries,  as well as high margin
processed  and smoked meat  products.  Astoria  Bakery  manufactures,  sells and
distributes  high  margin  specialty  breads such as special rye breads from its
bakery  in  Randburg,   South  Africa.  In  addition,   Astoria  Bakery  Lesotho
manufactures, sells and distributes staple bread to the Lesotho market, from its
bakers in Maseru,  the  capital  of  Lesotho.  Fifers  Bakery  manufactures  and
distributes high quality long life baked confectionary products and filo pastry.

      SA Leisure, Republic Umbrella, Galactex and Tradewinds Parasol are engaged
in the manufacture and  distribution of a variety of indoor and outdoor consumer
products.  Each  of our  indoor  and  outdoor  consumer  products  companies  is
characterized  by a focus on providing a broad spectrum of products to the South
African retail market,  with an increasing  emphasis on exports as well. We sell
to South Africa's leading retail chains. SA Leisure manufactures a wide range of
injection  molded consumer  items.  SA Leisure's  product line includes over 100
products ranging from injection  molded  household  products such as containers,
waste and laundry baskets,  garden chairs and tables,  do-it-yourself  tool kits
and luggage, as well as a range of office shelving and filing systems.  Republic
Umbrella  specializes  in the  assembly  and  distribution  of a wide variety of
umbrellas and other related outdoor  products.  Republic Umbrella is the largest
distributor of SA Leisure products.  Galactex Outdoor is the largest broad range
distributor of barbecues and barbecue  accessories  in South Africa,  and is the
exclusive  Southern Africa distributor of Weber-Stephen  barbeque products.  The
distribution  agreement with Weber was entered into in 1984.  Tradewinds Parasol
is South  Africa's  leading  manufacturer  of  large  outdoor  wooden  parasols.
Tradewinds  Parasol  is an  export  oriented  producer  and has  established  an
international  reputation as a leading  manufacturer of high-quality  canvas and
wooden parasols.

      We source our raw materials and products for all of our lifestyle products
businesses from both local and foreign suppliers.  We have adequate  alternative
suppliers and to date have had no difficulty  obtaining adequate supplies of all
our  requirements.  Our  specialty  foods  business is slightly  stronger in the
months of July through October as well as December. However, these increases are
not significant  enough to make it a seasonal  business.  Our indoor and outdoor
consumer products business is seasonal,  with business increasing  significantly
from September to January paralleling the South African summer.

                                      -3-
<PAGE>

      During fiscal year ended June 30, 2000, the following  customers accounted
for  approximately  the following  percentage of our sales revenue:  Woolworths,
15.7%; Clodchain,  9.9%; Spar, 6.0%; Pick n Pay, 6.9%; and Massmart,  10.2%. Our
lifestyle products  businesses had revenues of approximately $93.3 million which
accounted for  approximately  99% of our revenues for fiscal year ended June 30,
2000.   Our  lifestyle   products   business  had  income  from   operations  of
approximately $6.5 million for fiscal 2000.

Government Regulation

      Our South African specialty food and lifestyle product business operations
are  subject  to a  number  of  laws  and  regulations  governing  the  use  and
disposition  of  hazardous  substances,   air  and  water  pollution  and  other
activities that effect the environment. We believe that each of our subsidiaries
is in substantial  compliance with applicable  South African law and regulations
and that no violation  of any such law or  regulation  has occurred  which would
have a material adverse effect on our financial condition.

Employees

      In   addition   to  our   President,   Clive   Kabatznik,   who  devotes
substantially   all  of  his   business   time  to  our  various   businesses,
Leisureplanet  Holdings,  Ltd. has only three  full-time  salaried  employees.
Our  subsidiary,  First  South  African  Holdings  (Pty.)  Ltd.  has  only two
full-time  salaried  employees.  Our operating  subsidiaries  currently employ
approximately  2,300  people.  We intend to add employees as necessary to meet
management and other requirements from time to time.

      Our  success  will  depend on our  ability  to attract  and retain  highly
qualified employees.  We provide performance based and equity based compensation
programs to reward and motivate  significant  contributors  among our employees.
Competition for qualified personnel in the industry is intense.  There can be no
assurance that our current and planned  staffing will be adequate to support our
future  operations  or that  management  will be able to  hire,  train,  retain,
motivate,  and manage  required  personnel.  Although  none of our  employees is
represented by a labor union,  there can be no assurance that our employees will
not join or form 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.  The principal  executive  offices of First South  African  Holdings
(Pty.) Ltd. are located in the facilities of Galactex in South Africa.

      Leisureplanet.com, our online travel services subsidiary, has two offices,
one in Cape Town, South Africa and one in Hassrode, Belgium. Our web servers are
located in Atlanta, Georgia and Hassrode, Belgium. Our lease in Cape Town covers
10,000 square feet, costs approximately $120,000 annually and expires in October
2004. Our lease in Hassrode,  Belgium covers  approximately  17,750 square feet,
costs approximately $230,000 annually and expires in April 2009.

      Piemans  Pantry  operates  from  premises and  facilities  that it owns in
Krugersdorp,  South  Africa.  The  facility  has two floors with a total size of
38,000 square feet.

      Astoria  Bakery  leases  approximately  20,000  square  feet of  space  in
Randburg,  South  Africa  for  which  it pays an  annual  rent of  approximately
$100,000 pursuant to a lease expiring in 2006.

      Seemanns Meat Products  operates from premises and facilities that it owns
in Randburg,  South Africa.  These premises include a retail outlet and comprise
approximately 44,000 square feet.

      Gull  Foods  operates  from  premises  and  facilities  that it  rents  in
Bronkhorstspruit,  South Africa.  Such  premises  include  approximately  52,000
square  feet of space.  Rental  cost is  approximately  $62,000 per annum with a
lease term of five years expiring in June 2003.

                                      -4-
<PAGE>

      Fifers Bakery  leases  approximately  18,840 square feet in Isando,  South
Africa for which it pays an annual rent of approximately  $288,000 pursuant to a
lease expiring in June 2006.

      Republic Umbrella leases  approximately  16,000 square feet in Springfield
Park,  Kwa  Zulu-Natal,  South  Africa  for  which  it  pays an  annual  rent of
approximately $322,000 pursuant to a lease expiring in November 2003.

      Galactex  Outdoor  leases  approximately  10,000  square feet in Route 24,
Meadowdale,  Gauteng,  South  Africa  for  which  it  pays  an  annual  rent  of
approximately $131,000 pursuant to a lease expiring in September 2008.

      SA Leisure operates out of an administration building in Gardens, Gauteng,
South Africa which it owns and which includes approximately 2,100 square feet of
space. S.A. Leisure also operates out of a 30,000 square foot leased facility in
Isithebe,  Kwa  Zulu-Natal,  South  Africa  for which it pays an annual  rent of
approximately $361,000 pursuant to a lease expiring in October 2000.

      Our United  States  subsidiary,  First South Africa  Management  Corp.,  a
Delaware  corporation  incorporated in 1995, has its principal executive offices
at 6100 Glades  Road,  Suite 305,  Boca Raton,  Fl 33434.  The lease  expires in
February 20003 and costs us approximately $28,000 per year.

Item 3.  Legal Proceedings

      Neither we nor any of our  subsidiaries  is subject to any material  legal
proceedings.

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

      On May 1, 2000 we held our annual meeting of  shareholders.  At the annual
meeting,  our shareholders elected five directors to serve until the next annual
meeting and until their respective successors are elected and qualified.  At the
annual meeting,  our  shareholders  also approved a change in an increase in the
number of  authorized  shares of our common stock from  23,000,000 to 50,000,000
and approved the  appointment of  PricewaterhouseCoopers  Inc as our independent
public accountants. The votes for directors were as follows:

                                                         Votes
                                        ----------------------------------------
                                            For                     Withheld
                                        -----------------       ----------------
Michael Levy                             10,527,219                 327,548
Clive Kabatznik                          10,527,219                 327,548
Cornelius Roodt                          10,527,219                 327,548
David BenDaniel                          10,527,219                 327,548
Chris Matty                              10,527,219                 327,548





                                      -5-
<PAGE>


The votes with respect to the increase in our authorized shares was as follows:


        For                           Against                       Abstain
 -------------------            ------------------            ------------------
     10,455,365                       77,664                        321,738


The votes with respect to the appointment of our independent  public accountants
were as follows:


        For                           Against                       Abstain
 -------------------            ------------------            ------------------
      10,837,607                      15,310                         1,850



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  LPHL.  Our  redeemable  Class A  warrants  and
redeemable  Class B warrants  are listed for  quotation  on the Nasdaq  SmallCap
Market under the symbols  LPHLU,  LPHLW and LPHLZ,  respectively.  The following
table sets forth,  for the  periods  indicated  the high and low  closing  sales
prices for our common stock,  units,  redeemable Class A warrants and redeemable
Class B warrants as reported by Nasdaq.

                                                 High            Low
                                                 ----            ---

Common Stock
------------
Fiscal 1999
1st Quarter...................................   $4.75           $.75
2nd Quarter...................................   $1.6875         $.75
3rd Quarter...................................   $3.25           $1.3125
4th Quarter...................................   $11.875         $1.1875

Fiscal 2000
1st Quarter...................................   $7.938          $3.625
2nd Quarter...................................   $16.50          $3.563
3rd Quarter...................................   $14.25          $8.063
4th Quarter...................................   $9.063          $2.438

Fiscal 2001
1st Quarter (through September 30, 2000)......   $3.313          $1.031

Class A Warrants
----------------
Fiscal 1999
1st Quarter...................................   $1.375          $0.375
2nd Quarter...................................   $0.625          $0.0625
3rd Quarter...................................   $0.75           $0.0625
4th Quarter...................................   $9.00           $0.4375

Fiscal 2000
1st Quarter...................................   $4.75           $2.00
2nd Quarter...................................   $16.250         $2.375
3rd Quarter...................................   $13.00          $5.875
4th Quarter...................................   $3.25           $1.875


                                      -6-
<PAGE>


Fiscal 2001
1st Quarter (through September    , 2000).....   $2.375          $0.50

Class B Warrants
----------------
Fiscal 1999
1st Quarter...................................   $1.125          $0.625
2nd Quarter...................................   $0.625          $0.125
3rd Quarter...................................   $0.625          $0.125
4th Quarter...................................   $0.3125         $0.125

Fiscal 2000
1st Quarter...................................   $2.00           $0.719
2nd Quarter...................................   $8.50           $0.563
3rd Quarter...................................   $6.00           $2.125
4th Quarter...................................   $2.688          $0.25

Fiscal 2001
1st Quarter (through September   , 2000)......   $0.375          $0.063


      As of September 30, 2000,  there were  approximately  3,350 holders of our
common stock,  exclusive 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 intend to declare or pay 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.

      In connection  with our agreement  with  InfoSpace.com,  Inc., on June 30,
1999, we issued a warrant to purchase  720,000  shares of our common stock at an
exercise price of $.01 which warrant will vest in six consecutive quarters.

SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA

All of the financial data set forth below should be read in conjunction with the
information appearing under the caption "Management's Discussion and Analysis of
Financial Condition and Results of Operations."


<TABLE>
<CAPTION>

SELECTED CONSOLIDATED FINANCIAL INFORMATION

--------------------------------------------------- --------------------------------------------------------------------------------
STATEMENT OF OPERATIONS DATA                                                              THE COMPANY
--------------------------------------------------- --------------------------------------------------------------------------------
                                                                                      YEARS ENDED JUNE 30,
--------------------------------------------------- --------------------------------------------------------------------------------
                                                           1996 (1)          1997 (1)         1998             1999            2000
                                                              $                 $         Restated         Restated        Restated
                                                              -                 -                $                $               $
--------------------------------------------------- ---------------- ---------------- -------------- ---------------- --------------
<S>                                                   <C>              <C>               <C>             <C>          <C>
Revenues                                              1,570,888        41,885,993                -                -               -
--------------------------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Total operating expenses                             (8,198,079)      (38,559,968)       2,000,920        2,504,838       2,662,108
--------------------------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Operating (loss)/income                              (6,627,191)        3,325,945       (2,000,920)      (2,504,838)     (2,662,108)

                                                                 -7-
<PAGE>
--------------------------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Interest (expense)/income                              (351,793)           26,016       (1,223,654)      (2,403,997)     (1,363,360)
--------------------------------------------------- ---------------- ---------------- -------------- ---------------- --------------
(Loss)/income from continuing operations before
income taxes                                         (6,965,556)        7,149,970         (615,740)      (6,208,976)     (4,232,603)
--------------------------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Net (loss)/income from continuing operations         (6,743,363)        5,832,932         (615,740)      (6,210,195)     (4,233,222)
--------------------------------------------------- ---------------- ---------------- -------------- ---------------- --------------
(Loss)/gain from discontinued operations              1,005,803           850,243        3,387,631       (4,916,267)    (34,429,264)
--------------------------------------------------- ---------------- ---------------- -------------- ---------------- --------------
Net (loss)/income                                                       6,683,165        2,771,891      (11,126,462)    (38,662,486)
--------------------------------------------------- ---------------- ---------------- -------------- ---------------- --------------
(Loss)/income per share  - from continuing
operations                                              ($3,56)            $1,13           ($0,10)          ($0,95)         ($0,54)
--------------------------------------------------- ---------------- ---------------- -------------- ---------------- -------------

-----------------------------------------------------------------------------------------------------------------------------------
BALANCE SHEET DATA                                                          THE COMPANY
                                                                              JUNE 30,
------------------------------ ----------------------------------------------------------------------------------------------------
                                          1996                 1997                 1998               1999                    2000
                                                                                Restated           Restated                Restated
                                             $
                                                                  $                    $                  $                       $
------------------------------ -------------------- ------------------- -------------------- -------------------- -----------------
Total assets                        23,604,994           64,197,149           89,561,459        102,615,018              94,266,439
------------------------------ -------------------- ------------------- -------------------- -------------------- -----------------
Long term liabilities                2,361,372           13,341,758           29,507,926         33,598,244              15,473,769
------------------------------ -------------------- ------------------- -------------------- -------------------- -----------------
Net working capital (2)              4,624,417           25,357,584           25,491,685         28,276,771              31,414,757
------------------------------ -------------------- ------------------- -------------------- -------------------- -----------------
Stockholders' equity                12,792,376           23,220,014           16,097,666          2,090,966               5,595,870
------------------------------ -------------------- ------------------- -------------------- -------------------- -----------------
</TABLE>

(1) Due to the  unavailability of financial data on discontinued  operations for
    the 1996 and 1997  fiscal  years,  the  discontinuation  of First  Lifestyle
    Holdings  and  Leisureplanet  have  not been  taken  into  account  in these
    figures.

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

(3) Loss from  discontinued  operations and net loss for the year ended June 30,
    2000 have been restated by $6,823,816. See note 2 (m) (ii) to the
    consolidated financial statements for details of the restatement

                                       -8-
<PAGE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS

BACKGROUND AND HISTORY

Silverstar Holdings Limited ("LPHL"),  formerly  Leisureplanet  Holdings Ltd was
incorporated   in  September   1995  with  the  intention  to  actively   pursue
acquisitions fitting a pre defined investment strategy. Prior to our acquisition
of  Leisureplanet.com,  an online travel services company, in February 1999, the
broad strategy followed by us in all of our investment decisions was as follows:

o    Revenue is to be within the range of $5Million - $50 Million.

o    Net income must yield a sustainable above average return on investment.

o    Growth in revenue must be above average growth rates and must be
     sustainable over the medium term.

o    The industry in which the target operates must meet the pre defined
     industry sectors identified by management as sectors meeting our broad
     investment strategy.

LPHL holds, through its South African subsidiary, First South African Holdings
(Pty) Ltd. ("FSAH"), an investment in First Lifestyle Holdings Limited
("Lifestyle"), which has met the acquisition criteria identified above. In
addition, the Company holds a stake in Leisureplanet. Com ("LPI"), an Internet
travel related company. The focus of the Company has changed from investing in
South African companies to actively seeking out investments in Internet related
industries.

In keeping with this new focus, we will be basing our investments on the
following strategy:

o    Acquiring controlling stakes in small, high quality, high growth,
     technology and internet related businesses with strong management teams.

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.

The Company has made two additional investments during the current year, taking
up equity stakes in Magnolia Broadband, a start-up operation in the Internet
broadband field, and HotelSupplyGroup.com, Limited, a start-up operation seeking
to provide supply services via the Internet to hotel groups.

Due to this change in focus the Company has disposed of Lifestyle. On June 21,
2000 the Company received an offer from Lifestyle management to buy Lifestyle
from the Company. The Company accepted the offer on September 26, 2000 at a
general meeting of Lifestyle shareholders. This deal is still subject to
regulatory approval.

Due to the lack of investor appetite for loss making Internet businesses, no
further funding was available to fund the activities of LPI, the Internet travel
related business. On August 2, 2000 LPI was placed under voluntary
administration in the United Kingdom. Full provision has been made for the
Company's investment in LPI.

                                      -9-
<PAGE>

RESULTS OF OPERATIONS

The results of operations analyse the corporate activity of the group as
Lifestyle and LPI are no longer included as continuing operations. Discussion of
the results of these operations is given under the heading, discontinued
operations, below.

Fiscal 2000 compared to fiscal 1999

Selling, general and administrative expenses

     Selling, general and administrative expenses for the year ended June 30,
     2000 decreased by $0,25 Million to $1,84 Million as compared to $2,09
     Million for the fiscal year ended June 30, 1999. This decrease is primarily
     due to a reduction in corporate support needed for the Lifestyle business
     due to the shift in focus to Internet and Technology related investments.

Amortisation of intangibles

     Amortisation of intangibles increased from $0,41 Million in fiscal 1999 to
     $0,73 Million in fiscal 2000. This increase is primarily due to a change in
     estimate of the useful life of non-competition agreements. Goodwill arose
     on the investment in Magnolia Broadband, which contributed $0,1 Million to
     the current year charge.

Depreciation

     Depreciation charge relates to minor office equipment, furniture and
     computer equipment. Due to the nature of the head office function, these
     charges are immaterial.

Foreign currency loss

     Foreign currency loss of $0,08 Million represents the loss realized on the
     repayment and the translation of the current account between FSAH and LPHL.

     The South African Rand has depreciated by 37,6% over the fiscal period 1998
     to 2000.

Gain on sale of subsidiary stock

     In the prior year 13,946,500 shares held by FSAH in Lifestyle were sold at
     an average price of R2,48 per share realising a consolidated gain on
     disposal of $0,62 Million. In addition, a loss on dilution on a group
     restructure of $1,42 Million was realised. During the current year 900,000
     shares in First Lifestyle Holdings Limited were sold at R3,00 per share,
     realising a gain of $0,1 Million.

Interest expense

     Interest expense has decreased by $1,04 Million from an interest expense of
     $2,40 Million to $1,36 Million. The conversion of 3,000 of the increasing
     rate debentures and the remaining 9% debentures gave rise to an interest
     saving of $0,23 Million in the current year. The balance of the movement
     was made on interest earned on cash balances; the Company had significant
     cash resources throughout the year as compared to the previous fiscal year.

Provision for income taxes

     The Company is registered in Bermuda, where no tax laws are applicable.

                                      -10-
<PAGE>

Fiscal 2000 compared to fiscal 1999 (continued)

Interest in losses of affiliates

     The Company acquired a 48% stake in Magnolia Broadband, a 51% stake in
     HotelSupplyGroup.com and a 50% stake in Hall Lifestyle Products. All of
     these companies are start-up ventures, which have only incurred expenses to
     date. The charge of $0,16 Million represents our equity accounted share of
     their operating losses for the period.

Discontinued operations

     During the 2000 fiscal year a loss of $11,93 Million arose on discontinued
     operations as compared to $3,94 Million in fiscal 1999, representing an
     increase of $7,99 Million over the prior year. The prior fiscal year
     included the industrial and packaging business segments, which incurred
     losses of $1,46 and were disposed of during 1999. The loss realized on the
     LPI business segment increased by $8,95 Million from $6,17 Million in 1999
     to $15,12 Million in 2000. The increase in the loss was primarily due to an
     aggressive attempt to increase the awareness of the product offered by
     signing up expensive portal agreements and advertising arrangements. Due to
     the lack of investor appetite for loss making Internet enterprises, LPI
     could no longer fund its operations and was placed under voluntary
     administration on August 2, 2000. Full provision has been made for the
     Company's investment in LPI. The Lifestyle business sector contributed a
     profit of $3,19 Million as compared to $3,69 Million during the previous
     fiscal year, a decrease of $0,50 Million over the fiscal year. This is
     primarily because the growth experienced in this division in South African
     Rand was 3,9% which is below the currency depreciation of the South African
     Rand against the US Dollar of 13%. The growth in the business sector was
     below expectations due to the lack of consumer demand in South Africa and
     the inability to increase selling prices to recover increased costs passed
     by Lifestyle suppliers due to competitive pressures experienced in a weak
     consumer market.

     The Company previously disclosed that it would record a profit from the
     sale of Lifestyle. The Company did not consider the impact of the
     accumulated foreign currency translation adjustments and the impairment of
     an intangible asset related to a restraint of trade agreement on the
     disposition of Lifestyle. When these are considered, a loss arises on
     disposition. Consequently the loss on disposition of discontinued
     operations and net loss for the year ended June 30, 2000 have been restated
     by $6,823,816. Earnings per share, the consolidated statement of
     stockholders equity and comprehensive income and Notes 15 and 16 relating
     to discontinued operations have also been restated to reflect this change.
     Earnings per share information,as previously reported and as restated is as
     follows:

     ------------------------------------------------------------------------
                                                     Previously
     Earnings/(Loss) per share - basic and diluted   Reported    Restated
                                                            $           $
     ------------------------------------------------------------------------
     Continuing operations                              (0,54)      (0,54)
     ------------------------------------------------------------------------
     Discontinued operations                            (3,52)      (4,39)
                                                        ------      ------
     ------------------------------------------------------------------------
     Net                                                (4,06)      (4,93)
                                                        ------      ------
     ------------------------------------------------------------------------

     The loss on disposition of $22,50 Million in fiscal 2000 increased by
     $21,53 Million from $0,97 Million in fiscal 1999. The increase is primarily
     due to the estimated loss on liquidation of the LPI business segment and
     the expected loss arising on the disposition of the Lifestyle business
     segment after the inclusion of the currency translation adjustment reserve
     and the impairment of an intangible asset related to a restraint of trade
     agreement.

Preference dividend declared

     During fiscal 2000, the preference dividend on the mandatory redeemable
     preference shares has been accrued on a time proportion basis as the
     agreement to pay preference dividends provides for two options, the first
     being that the dividend payable must be based on the ordinary dividend
     declared by

                                      -11-
<PAGE>

     Lifestyle, or the second option must increase by a minimum of 25% percent
     over the prior year. The first option is payable three days after receipt
     of the Lifestyle dividend, the second option is payable on February 19, of
     each calendar year. Since no Lifestyle preference dividend was declared
     during the current fiscal year the dividend of $0,15 Million represents the
     time proportion of the dividend payable on February 19, 2001.

Fiscal 2000 compared to fiscal 1999 (continued)

Net (loss)/income

     As a result of the above the Company has achieved a loss of $38,66 Million
     as compared to a loss of $11,13 Million in the prior year.

Fiscal 1999 compared to fiscal 1998

Selling, general and administrative expenses

     Selling, general and administrative expenses for the year ended June 30,
     1999 increased by $0,83 Million to $2,09 Million as compared to $1,26
     Million for the fiscal year ended June 30, 1998. This increase related to
     the corporate activity undertaken with the acquisition of LPI.

Amortisation of intangibles

     Amortisation of intangibles increased from $0,27 Million in fiscal 1998 to
     $0,41 Million in fiscal 1999. This increase is primarily due to the
     amortisation of the non-competition agreements entered into with the
     management of the Lifestyle business sector during the second quarter of
     the 1999 fiscal year. These non-competition agreements are being amortised
     over a three-year period.

Foreign currency loss

     The foreign currency loss incurred in 1998 represents a loss on current
     account payments made to LPHL. No loss was incurred in 1999.

Loss on sale of subsidiary stock

     A loss on dilution during a group restructure of $1,42 Million and a gain
     of $0,62 Million on the disposal of a part interest in Lifestyle was
     realised during the 1999 fiscal year. The loss on dilution arose on an
     inter-group disposal, which resulted in an increase in minority share of
     the underlying businesses. The gain of $0,61 Million was realised on the
     disposal of a part interest in Lifestyle at an average stock price of R2,48
     per share. In the prior year an average price of R5,50 was realized per
     share sold. This decrease in average price is due to a decline in the
     overall South African stock market.

Interest expense

     Interest expense has increased by $1,18 Million from an interest expense of
     $1,22 Million to $2,40 Million. This is primarily due to the increase of
     $0,28 Million in the debenture redemption reserve raised for the current
     year being for a full year as opposed to 9 months for the 1998 fiscal year.
     A decrease in the interest earned on cash resources due to the redemption
     of debentures during the period, utilizing a substantial portion of the
     surplus cash reserves of the Company, thereby depleting the interest earned
     on these resources. In addition the company incurred addition interest of
     $0,17 Million on the increasing rate debentures which incurred interest for
     the full year as opposed to 9 months in the 1998 fiscal year

Provision for income taxes

     The Company is registered in Bermuda, where no tax laws are applicable. The
     taxation charge for the current year arose in First South Africa Management
     Corp., Ltd., which is an American registered company and a subsidiary of
     the Company. This company had no taxable income for the 1998 fiscal year.

                                      -12-
<PAGE>

Fiscal 1999 compared to fiscal 1998 (continued)

Preference dividend declared

     During fiscal 1999, we declared a preference dividend of $0,50 million.
     This dividend represents the payment to the holders of $9,891 Million
     preferred stock in First South African Holdings. This stock was issued to
     fund the acquisition of LPI during the current fiscal year.

Discontinued operations

     During the 1999 fiscal year a loss from operations of $3,94 Million arose
     on the discontinued operations as compared to a profit of $3,39 Million in
     fiscal 1998, representing an increase of $7,33 Million over the prior year.
     The industrial and packaging business segments incurred a loss of $1,46
     Million in the 1999 fiscal year and a loss of $2,18 Million in the 1998
     fiscal year, an increase of $0,72 Million. The Lifestyle business sector
     contributed a profit of $3,86 Million as compared to $5,49 Million during
     the previous fiscal year, a decrease of $1,63 Million over the fiscal year.
     This is primarily due to, the percentage shareholding in the Lifestyle
     business sector decreasing by 15,18% during the year, coupled with a
     decline of 21,7% of the South African Rand against the US Dollar.

     The loss on disposal of $0,97 Million in fiscal 1999 represents the losses
     that were expected to occur subsequent to June 30, 1999. These losses were
     provided for in full and represented guarantees made to third parties on
     behalf of the discontinued operations. No operating losses were incurred
     beyond June 30, 1999.

Net (loss)/income

     As a result of the above the Company has achieved a loss of $11,13 Million
     as compared to a profit of $2,77 Million in the prior year.

Financial condition, liquidity and capital resources

     Cash increased by $9,04 Million from $20,81 Million to $29,85 Million.
     Included in the $29,85 Million is $4,64 Million which is restricted and
     will be used to repay LPI creditors. The increase is primarily due to the
     cash generated in the Lifestyle business sector, which increased by $3,21
     Million from $14,92 Million to $18,11 Million over the fiscal year. The
     remaining increase is due to the retention of some of the $20,00 Million
     raised in LPHL during the current fiscal year. The remainder of these funds
     raised was used to fund LPI by equity injections. On August 2, 2000, LPI
     was placed under voluntary administration due to the lack of further
     funding available to loss making Internet related businesses. No return is
     expected on our capital injections into LPI.

     Working capital increased by $3,14 Million to $31,42 Million at June 30,
     2000 from $28,28 Million at June 30, 1999. This is primarily due to the
     increase in cash balances offsetting decreases in trade accounts receivable
     and other current assets, which were partially offset by decreases in
     dividends payable.

     At June 30, 2000 we had borrowings of $18,48 Million which has decreased
     from $36,69 Million. The decrease is due to the voluntary administration of
     the LPI business segment which included $10,00 Million of loans owing to
     LPI minority shareholders. The conversion of debentures of $7,50 Million
     into shares of common stock also occurred during the fiscal year. In
     addition, the mortgage notes and equipment notes in Lifestyle decreased by
     repayments of $1,58 Million during the fiscal year.

     Operations for the year ended June 30, 2000, excluding non-cash charges
     resulted in the utilisation of $12,72 Million, primarily in the Internet
     travel related business. Investing activities undertaken by the group
     resulted in the utilisation of an additional $8,71 Million during the year,
     this included the acquisition of property, plant and equipment of $5,86
     Million, additional purchase price payments of $0,59 Million and
     investments in affiliates of $2,81 Million. The operations and investing
     activities were financed primarily by stock issues in the Company and LPI
     of $39,54 Million, a portion of these proceeds were used to repay debt of
     $6,23 Million.

                                      -13-
<PAGE>

Future commitments

     Under the various acquisition agreements, the Company will spend $1,02
     Million in cash for its contingent payments over the next 12 months. The
     cash receivable from the disposal of Lifestyle will fully fund these
     payments as well as fund the redemption of the mandatory redeemable
     preference shares and partial redemption of the increasing rate debentures
     during the current fiscal year. Excess cash will be utilised to fund
     additional acquisitions in the Internet technology market sector. There are
     no longer-term contingent acquisition payments remaining after payment of
     the $1,02 Million mentioned above.

     The Company intends to continue to pursue an acquisition strategy in
     Internet technology companies and anticipates utilising a substantial
     portion of its remaining cash balances and the proceeds of its disposal of
     Lifestyle to fund this strategy to the extent that suitable acquisition
     candidates can be identified.

     The Company may be required to incur additional indebtedness or equity
     financing in connection with the funding of future acquisitions. There is
     no assurance that the Company will be able to incur additional indebtedness
     or raise additional equity to finance future acquisitions on terms
     acceptable to management, if at all.

Quantitative and qualitative disclosures about market risk

     The company does not ordinarily hold market risk sensitive instruments for
     trading purposes. The company does however recognise market risk from
     interest rate and foreign currency exchange exposure.

     Interest rate risk

     At June 30, 2000 the Company's cash resources earn interest at variable
     rates. Accordingly the Company's return on these funds is affected by
     fluctuations in interest rates. The debt of the continuing operations is
     primarily at fixed interest rates. Any decrease in interest rates will have
     a negative effect on the Company's earnings. There is no assurance that
     interest rates will increase or decrease over the next fiscal year.

     Foreign currency risk

     The expected proceeds from the sale of Lifestyle will be received in South
     African Rands. This exposes the Company to market risk with respect to
     fluctuations in the relative value of the South African Rand against the US
     Dollar. Due to the prohibitive cost of hedging these proceeds, the exposure
     has not been covered as yet, should more favorable conditions arise a
     suitable Rand hedge may be considered by management. For every 1% decline
     in the Rand/US Dollar exchange rate, the Company loses R68,400 on every
     R1,000,000 retained in South Africa, at year-end exchange rates, this is
     equivalent to $10,000. Subsequent to year-end the Rand has depreciated
     against the US Dollar by an average 7%.

                                      -14-
<PAGE>

Supplemental Disclosure

Discontinued South African operations

As the Lifestyle results are reported in US Dollars, but revenues are primarily
generated in South African Rand, the South African inflation rate and the
depreciation of the South African Rand against the US Dollar are important to
the understanding of the Lifestyle results.

In broad terms, if the deterioration of the Rand is in excess of the rate of
price increases in the Company's products, which generally equates the South
African inflation rate, then the company would need to generate South African
revenue in excess of the South African inflation rate to maintain US Dollar
parity.

The average rates for the South African Rand against the US Dollar for the
periods presented in this report are as follows:

------------------------------------------------------------------------
                                     Year ended  Year ended  Year ended
                                      June 30,    June 30,    June 30,
                                          2000        1999        1998
------------------------------------------------------------------------
Rate of exchange vs. $1                   6,84        6,05        4,97
------------------------------------------------------------------------
Depreciation                             13,06%       21,7%        9,7%
------------------------------------------------------------------------
Annual rate of inflation                   7,8%        4,9%        7,2%
------------------------------------------------------------------------


                                      -15-
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED

                  INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>

<S>                                                                                   <C>
   Report of Independent Accountants                                                F-1

   Consolidated Balance Sheets at June 30, 2000 and 1999                            F-2

   Consolidated Statements of Operations for the years ended June 20,
   2000, 1999 and 1998                                                              F-4

   Consolidated  Statements  of  Stockholders'  Equity and  Comprehensive
   Income for the years ended June 30, 2000, 1999 and 1998                          F-5

   Consolidated Statements of Cash Flows for the years ended June
   30, 2000,1999 and 1998                                                           F-8

   Notes to the Consolidated Financial Statements                                   F-10
</TABLE>

<PAGE>


                           SILVERSTAR HOLDINGS LIMITED

                      REPORT OF THE INDEPENDENT ACCOUNTANTS


To the Board of Directors and Stockholders of Silverstar Holdings Limited

In our opinion, the accompanying consolidated balance sheets and the related
consolidated statements of operations, of stockholders' equity, of comprehensive
income and of cash flows, present fairly, in all material respects, the
financial position of Silverstar Holdings Limited and its subsidiaries at June
30, 2000 and 1999, and the results of their operations and their cash flows for
each of the three years in the period ended June 30, 2000 in conformity with
accounting principles generally accepted in the United States. These financial
statements are the responsibility of the Company's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these statements in accordance with
generally accepted auditing standards in the United States which require that we
plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for the opinion expressed above.

As discussed in Note 2 to the consolidated financial statements, the Company
restated its consolidated financial statements for the years ended June 30,
2000, 1999 and 1998.



PricewaterhouseCoopers
West London
October 13, 2000
Except for Note 2(m) (ii)
as to which the date is February 20, 2001



                                      F-1
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>

-----------------------------------------------------------------------------------
                                     ASSETS
-----------------------------------------------------------------------------------
                                                          June 30,       June 30,
                                                              2000           1999
                                                          Restated       Restated
                                                                 $
                                                                                $
-----------------------------------------------------------------------------------
Current assets
-----------------------------------------------------------------------------------
<S>                                                     <C>            <C>
      Cash and cash equivalents                         29,853,067     20,813,301
-----------------------------------------------------------------------------------
      Accounts receivable, net                          10,608,197     12,945,389
-----------------------------------------------------------------------------------
      Inventories                                        9,386,857      9,152,575
-----------------------------------------------------------------------------------
      Prepaid expenses and other current assets          3,631,348      5,236,587
-----------------------------------------------------------------------------------
      Deferred income taxes                                898,280        539,884
                                                        -----------   ------------
-----------------------------------------------------------------------------------
            Total current assets                        54,377,749     48,687,736
-----------------------------------------------------------------------------------
Property, plant and equipment, net                      18,215,196     19,288,417
-----------------------------------------------------------------------------------
Investments in Affiliates                                1,283,935              -
-----------------------------------------------------------------------------------
Intangible assets, net                                  20,130,119     33,735,933
-----------------------------------------------------------------------------------
Deferred charges                                           228,078        868,944
-----------------------------------------------------------------------------------
Other assets                                                31,362         33,988
                                                        ------------- ------------
-----------------------------------------------------------------------------------
                                                        94,266,439    102,615,018
Total Assets                                            ==========    ===========
-----------------------------------------------------------------------------------
</TABLE>

See accompanying notes to the consolidated financial statements

                                      F-2
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
                           CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------
                      LIABILITIES AND STOCKHOLDERS' EQUITY
-----------------------------------------------------------------------------------
                                                           June 30,     June 30,
                                                               2000         1999
                                                           Restated     Restated
                                                                  $              $
-----------------------------------------------------------------------------------
Current liabilities
-----------------------------------------------------------------------------------
<S>                                                      <C>          <C>
      Bank overdraft                                        896,860            -
-----------------------------------------------------------------------------------
      Current portion of long term debt                   2,105,153    3,088,435
-----------------------------------------------------------------------------------
      Accounts payable                                   13,046,686    9,060,327
-----------------------------------------------------------------------------------
      Other provisions and accruals                       5,754,638    4,618,283
-----------------------------------------------------------------------------------
      Dividends payable                                     179,840    1,870,959
-----------------------------------------------------------------------------------
      Income taxes payable                                  676,003    1,214,292
-----------------------------------------------------------------------------------
      Other taxes payable                                   303,812      558,669
                                                        -----------  -----------
-----------------------------------------------------------------------------------
            Total current liabilities                    22,962,992   20,410,965
-----------------------------------------------------------------------------------
Long term debt                                           15,473,769   33,598,244
-----------------------------------------------------------------------------------
Deferred income taxes                                     4,402,038    3,722,971
                                                        -----------  -----------
-----------------------------------------------------------------------------------
            Total liabilities                            42,838,799   57,732,180
                                                         ----------   ----------
-----------------------------------------------------------------------------------
Minority interest                                        37,059,840   32,900,675
-----------------------------------------------------------------------------------
FSAH mandatory redeemable preferred stock                 8,771,930    9,891,197
-----------------------------------------------------------------------------------
Commitments and contingencies (Note 22)
-----------------------------------------------------------------------------------
Stockholders' equity
-----------------------------------------------------------------------------------
Capital stock:
      A class common stock, $0.01 par value - authorized
 23,000,000
      Shares, issued and outstanding  8,368,676 shares       83,687       53,832
      (1999: 5,383,142 shares)
-----------------------------------------------------------------------------------
      B class common stock, $0.01 par value - authorized
2,000,000 shares,                                             9,466        9,466
      Issued and outstanding  946,589 shares (1999:
946,589 shares)
-----------------------------------------------------------------------------------
      FSAH B class common stock, R0,001 par value -
authorized
      10,000,000 shares, issued and outstanding                 600          580
2,671,087 shares
      (1999: 2,550,466 shares)
-----------------------------------------------------------------------------------
     Preferred stock, $0.01 par value - authorized
     5,000,000 shares, none                                       -            -
     Issued
-----------------------------------------------------------------------------------
      Additional paid-in capital                         64,307,442   22,321,906
-----------------------------------------------------------------------------------
      Accumulated deficit                               (44,595,916)  (5,933,430)
-----------------------------------------------------------------------------------
      Accumulated Other Comprehensive Income            (14,209,409) (14,361,388)
                                                        ------------ ------------
-----------------------------------------------------------------------------------
            Total stockholders' equity                    5,595,870     2,090,966
                                                        -----------  ------------
-----------------------------------------------------------------------------------
                                                         94,266,439  102,615,018
Total liabilities and stockholders' equity              ===========  ===========
-----------------------------------------------------------------------------------
</TABLE>

See accompanying notes to the consolidated financial statements

                                      F-3
<PAGE>
<TABLE>
<CAPTION>
                           SILVERSTAR HOLDINGS LIMITED
                      CONSOLIDATED STATEMENTS OF OPERATIONS
-----------------------------------------------------------------------------------
                                            Year ended   Year ended    Year ended
                                              June 30,     June 30,      June 30,
                                                  2000         1999          1998
                                              Restated     Restated      Restated
                                                     $            $             $
-----------------------------------------------------------------------------------
Revenues
<S>                                          <C>          <C>           <C>
                                                     -            -             -
-----------------------------------------------------------------------------------
Operating expenses
-----------------------------------------------------------------------------------
      Cost of sales                                  -            -             -
-----------------------------------------------------------------------------------
      Selling, general and administrative    1,844,197    2,090,086     1,263,081
      costs
-----------------------------------------------------------------------------------
      Amortisation of intangibles              730,719      410,466       271,387
-----------------------------------------------------------------------------------
      Depreciation                               6,490        4,286         5,644
-----------------------------------------------------------------------------------
      Foreign currency loss                     80,702          -         460,808
                                            ----------  -------------------------
-----------------------------------------------------------------------------------
                                             2,662,108    2,504,838     2,000,920
                                             ---------    ---------    ----------
-----------------------------------------------------------------------------------
Operating loss                              (2,662,108)  (2,504,838)   (2,000,920)
-----------------------------------------------------------------------------------
Gain/(loss) on sale of subsidiary stock        103,505     (804,150)    2,608,834
-----------------------------------------------------------------------------------
Interest in losses of affiliates              (160,885)           -             -
-----------------------------------------------------------------------------------
Preference dividend                           (149,755)    (495,991)            -
-----------------------------------------------------------------------------------
Interest expense (Net of  interest income
of $668,109,                                (1,363,360)  (2,403,997)   (1,223,654)
                                            -----------  -----------   -----------
$297,834 and $644,610)
-----------------------------------------------------------------------------------
Income/(loss) from continuing operations
before income                               (4,232,603)  (6,208,976)     (615,740)
 Taxes
-----------------------------------------------------------------------------------
Provision for income taxes                        (619)      (1,219)            -
                                           -----------      -------      ---------
-----------------------------------------------------------------------------------
Income/(loss) from continuing operations    (4,233,222)  (6,210,195)     (615,740)
-----------------------------------------------------------------------------------
Discontinued operations (Note 15):
-----------------------------------------------------------------------------------
     (Loss)/income from operations, net
     of income taxes                       (11,931,286)  (3,941,319)    3,387,631
     of $2,543,255, $2,893,380 and
     $3,966,916
-----------------------------------------------------------------------------------
     Loss on disposition, net of taxes of
     $nil, $nil and $nil                   (22,497,978)     (974,948)           -
                                           ------------ -------------   ----------
-----------------------------------------------------------------------------------
Net (loss)/income                          (38,662,486) (11,126,462)    2,771,891
                                           ------------ ------------    ---------
-----------------------------------------------------------------------------------
Earnings/(Loss) per share - basic and
diluted
-----------------------------------------------------------------------------------
      Continuing operations                     ($0,54)      ($0,95)       ($0,10)
-----------------------------------------------------------------------------------
      Discontinued operations                   ($4,39)      ($0,75)        $0,53
                                                -------      -------        -----
-----------------------------------------------------------------------------------
      Net income/(loss)                         ($4,93)      ($1,70)        $0,43
                                                -------      -------        -----
-----------------------------------------------------------------------------------
Weighted average common stock outstanding:
-----------------------------------------------------------------------------------
      Basic and diluted                      7,836,387    6,548,491     6,424,981
                                             ---------    ---------     ---------
-----------------------------------------------------------------------------------
</TABLE>
        See accompanying notes to the consolidated financial statements

                                      F-4
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
   CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------
                                      Silverstar         Silverstar
                                        Holdings          Holdings
                                        Limited           Limited        First SA Holdings
                                    A class common     B class common    B class common
                                         Stock             Stock             Stock
-------------------------------------------------------------------------------------------
                                     Shares   Amount   Shares    Amount   Shares    Amount
                                                   $                  $                  $
-------------------------------------------------------------------------------------------
<S>             <C> <C>            <C>        <C>    <C>         <C>    <C>            <C>
Balance at June 30, 1997           3,536,500  35,361 1,822,500   18,225 1,921,458      466
-------------------------------------------------------------------------------------------
Issuance of stock to FSAC escrow    386,324    3,863        -         -        -         -
agent
-------------------------------------------------------------------------------------------
Issuance of stock to acquire        142,918    1,429        -         -   84,751        19
subsidiaries
-------------------------------------------------------------------------------------------
Issuance of stock on additional           -        -         -         -  301,573        52
purchase price payments
-------------------------------------------------------------------------------------------
Warrants exercised                  233,826    2,339        -         -        -         -
-------------------------------------------------------------------------------------------
Warrant swap out at par value      1,173,476  11,738        -          -        -         -
-------------------------------------------------------------------------------------------
Options exercised                    35,000      350        -          -        -         -
-------------------------------------------------------------------------------------------
Conversion of 9% debentures to      141,165    1,412        -         -        -         -
common stock
-------------------------------------------------------------------------------------------
Net income                                -        -        -         -        -         -
-------------------------------------------------------------------------------------------
Translation adjustment                    -        -        -         -        -         -
-------------------------------------------------------------------------------------------
Total comprehensive loss                                                                 -
                                   ---------------   ---------------    ------------------
-------------------------------------------------------------------------------------------
Balance at June 30, 1998           5,649,209  56,492 1,822,500   18,225 2,307,782      537
-------------------------------------------------------------------------------------------
Issuance of stock to FSAC escrow    243,400    2,434        -         -        -         -
agent
-------------------------------------------------------------------------------------------
Issuance on stock on additional           -        -         -         -  242,684        43
purchase price payments
-------------------------------------------------------------------------------------------
Options exercised                    20,000      200        -         -        -         -
-------------------------------------------------------------------------------------------
Conversion of 9% debentures to      320,700    3,207        -         -        -         -
common stock
-------------------------------------------------------------------------------------------
Redemption and cancellation of
stock from FSAC escrow             (1,726,078(17,260)       -         -        -         -
Agent
-------------------------------------------------------------------------------------------
Conversion of B class common
stock to A class common             875,911    8,759 (875,911)   (8,759)       -         -
Stock
-------------------------------------------------------------------------------------------
Net loss                                  -        -        -         -        -         -
-------------------------------------------------------------------------------------------
Translation adjustment                    -        -        -         -        -         -
-------------------------------------------------------------------------------------------
Total comprehensive loss              -        -        -         -        -
                                   ------------------------------------ ------------------
-------------------------------------------------------------------------------------------
Balance at June 30, 1999           5,383,142  53,832  946,589     9,466 2,550,466      580
                                   =========  ======  =======     ===== =========      ===
-------------------------------------------------------------------------------------------

See accompanying notes to the consolidated financial statements

                                      F-5
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
   CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME

-------------------------------------------------------------------------------------------
                                                    Retained
                                   Additional       Earnings      Accumulated
                                    Paid-in       (Accumulated       Other
                                    Capital         deficit)    Comprehensive      Total
                                                                    Income
---------------------------------------------------------------------------------------------
                                     Shares   Amount   Shares    Amount   Shares    Amount
                                                   $                  $                  $
---------------------------------------------------------------------------------------------
Balance at June 30, 1997           22,891,093      2,421,141      (2,168,264)    23,198,022
---------------------------------------------------------------------------------------------
Issuance of stock to FSAC escrow       (3,863)          -               -              -
agent
---------------------------------------------------------------------------------------------
Issuance of stock to acquire        1,685,282           -               -         1,686,730
subsidiaries
---------------------------------------------------------------------------------------------
Issuance of stock on additional     1,227,137           -               -         1,227,189
purchase price payments
---------------------------------------------------------------------------------------------
Warrants exercised                  1,517,765           -               -         1,520,104
---------------------------------------------------------------------------------------------
Warrant swap out at par value         (11,738)          -               -              -
---------------------------------------------------------------------------------------------
Options exercised                     137,150           -               -           137,500
-------------------------------------------------------------------------------------------
Conversion of 9% debentures to        845,578           -               -           846,990
common stock
---------------------------------------------------------------------------------------------
Net income                               -         2,771,891
---------------------------------------------------------------------------------------------
Translation adjustment                   -                        (15,209,049)
---------------------------------------------------------------------------------------------
Total comprehensive loss                                                        (12,437,158)
---------------------------------------------------------------------------------------------
Balance at June 30, 1998           28,288,404      5,193,032      (17,377,313)   16,179,377
---------------------------------------------------------------------------------------------
Issuance of stock to FSAC escrow       (2,434)          -                -             -
agent
---------------------------------------------------------------------------------------------
Issuance on stock on additional     1,033,572           -                -        1,033,615
purchase price payments
---------------------------------------------------------------------------------------------
Options exercised                     106,800           -                -          107,000
---------------------------------------------------------------------------------------------
Conversion of 9% debentures to      1,732,895           -                -        1,736,102
common stock
---------------------------------------------------------------------------------------------
Redemption and cancellation of
stock from FSAC escrow             (8,837,331)          -                -      (8,854,591)
Agent
---------------------------------------------------------------------------------------------
Conversion of B class common
stock to A class common                  -              -                -            -
Stock
---------------------------------------------------------------------------------------------
Net loss                                 -       (11,126,462)
---------------------------------------------------------------------------------------------
Translation adjustment                   -                          3,015,925
---------------------------------------------------------------------------------------------
Total comprehensive loss                 -               -               -       (8,110,537)
---------------------------------------------------------------------------------------------
Balance at June 30, 1999           22,321,906      (5,933,430     (14,361,388)   2,090,966
                                   ===========================================================
---------------------------------------------------------------------------------------------
</TABLE>
(1)  Opening  retained  earnings  has been  restated  to  reflect  prior  year's
adjustments  for deferred  tax on  intangibles  to reduce the original  retained
earnings by $381,904.

See accompanying notes to the consolidated financial statements
                                      F-6
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
   CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
                                                                                                     Retained
                                                         Silverstar     First SA Holdings  AdditionalEarnings Accumulated
                                      Silverstar          Holdings        B class common    Paid-in  (Accumulated Other
                                       Holdings           Limited             Stock         Capital  deficit) Comprehensive Total
                                                       B class common                                Restated    Income  Restated
                                        Limited            Stock                                               Restated
                                    A class common
                                         Stock
----------------------------------------------------------------------------------------------------------------------------------
                                     Shares   Amount   Shares    Amount   Shares    Amount
                                                   $                  $                  $        $         $        $          $
----------------------------------------------------------------------------------------------------------------------------------
<S>             <C> <C>            <C>        <C>     <C>      <C>   <C>        <C> <C>        <C>         <C>           <C>
Balance at June 30, 1999           5,383,142  53,832  946,589  9,466 2,550,466  580 22,321,906 (5,933,430) (14,361,388)  2,090,966
----------------------------------------------------------------------------------------------------------------------------------
Issuance of stock to FSAC escrow    120,621    1,206        -      -        -     -     (1,206)      -         -               -
agent
-----------------------------------------------------------------------------------------------------------------------------------
Issuance of  stock on additional          -        -        -      -  120,621    20    567,687       -         -            567,707
purchase price payments
-----------------------------------------------------------------------------------------------------------------------------------
Issuance of shares                 1,379,310  13,793        -      -        -     - 18,361,207       -         -         18,375,000
-----------------------------------------------------------------------------------------------------------------------------------
Warrants exercised                  247,311    2,473        -      -        -     - 1,356,434        -         -          1,358,907
-----------------------------------------------------------------------------------------------------------------------------------
Options exercised                   180,000    1,800        -      -        -     -  872,296         -         -            874,096
-----------------------------------------------------------------------------------------------------------------------------------
Conversion of 9% debentures to      742,503    7,425        -      -        -     - 4,083,465        -         -          4,090,890
common stock
-----------------------------------------------------------------------------------------------------------------------------------
Increasing rate debentures          315,789    3,158        -      -        -     - 3,312,657        -         -          3,315,815
converted to common stock
-----------------------------------------------------------------------------------------------------------------------------------
Issuance of warrants                      -        -        -      -        -     - 3,446,633        -         -          3,446,633
-----------------------------------------------------------------------------------------------------------------------------------
Equity gain on group restructure          -        -        -      -        -     - 9,986,363        -         -          9,986,363
-----------------------------------------------------------------------------------------------------------------------------------
Net loss                                  -        -        -      -        -     -        -  (38,662,486)
-----------------------------------------------------------------------------------------------------------------------------------
Provision for loss on subsidiary          -        -        -      -        -     -        -         -        6,268,756
-----------------------------------------------------------------------------------------------------------------------------------
Translation adjustment                    -        -        -      -        -     -        -                 (6,116,777)
-----------------------------------------------------------------------------------------------------------------------------------
Total comprehensive loss                                                                                                (38,510,507)
                                          -        -        -      -        -     -        -                   -
-----------------------------------------------------------------------------------------------------------------------------------
Balance at June 30, 2000          8,368,676   83,687  946,589  9,466 2,671,087  600 64,307,442 (44,595,916) (14,209,409)  5,595,870
                                  =========   ======  =======  ===== =========  === ========== ===========  ===========   =========
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
See accompanying notes to the consolidated financial statements

                                      F-7
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------
                                                 Year ended  Year ended Year ended
                                                   June 30,    June 30,  June 30,
                                                       2000        1999      1998
                                                   Restated    Restated  Restated
                                                          $           $         $
------------------------------------------------------------------------------------
<S>                                              <C>         <C>         <C>
Cash flows from operating activities:
------------------------------------------------------------------------------------
      Net income/(loss) from continuing          (4,233,222) (6,210,195) (615,740)
operations
------------------------------------------------------------------------------------
     Dividend charge                                149,755     495,991         -
------------------------------------------------------------------------------------
      Depreciation and amortisation                 737,209     414,752   277,036
------------------------------------------------------------------------------------
     Non-cash compensation charge                         -     268,802
------------------------------------------------------------------------------------
      Deferred income taxes                         748,359   1,104,397 1,640,022
------------------------------------------------------------------------------------
      Net loss/(gain) on sale of assets             (34,419)    665,842  (200,408)
------------------------------------------------------------------------------------
      Net gain on sale of and dilution in          (103,505)    804,150 (2,608,834)
subsidiaries
------------------------------------------------------------------------------------
      Net loss/(gain) on minority shares issued           -                  (557)
in Lifestyle
------------------------------------------------------------------------------------
      Changes in operating assets and             3,838,445     541,506   421,084
liabilities, net
------------------------------------------------------------------------------------
      Creation of debenture redemption reserve    1,012,500     843,750   562,500
fund
------------------------------------------------------------------------------------
     Provision for affiliate losses                  35,763           -         -
------------------------------------------------------------------------------------
      Interest in losses of affiliates              160,885           -         -
                                                 -----------   ---------  ----------
------------------------------------------------------------------------------------
Net cash provided by/(used in) continuing         2,311,770  (1,071,005) (524,897)
operations
------------------------------------------------------------------------------------
Net cash provided by/(used in) discontinued      (15,032,079) 1,042,217  8,454,191
operations                                       -----------  --------- ----------
------------------------------------------------------------------------------------
Net cash provided by/(used in) operating         (12,720,309)    28,788  7,929,294
activities                                       -----------  --------- ----------
------------------------------------------------------------------------------------
Cash flows from investing activities:
------------------------------------------------------------------------------------
      Proceeds on disposal of investment in         421,400   5,712,671 4,358,027
subsidiaries
------------------------------------------------------------------------------------
      Proceeds on disposal of discontinued operations     -      91,718         -
------------------------------------------------------------------------------------
      Additional shares acquired in subsidiaries          -     (51,402)        -
------------------------------------------------------------------------------------
      Acquisition of intangibles                    (25,232)    (74,832)        -
------------------------------------------------------------------------------------
      Acquisition of property, plant and         (5,862,741) (5,968,074)(5,346,671)
equipment
------------------------------------------------------------------------------------
      Proceeds on disposal of property, plant       147,237     740,482 1,226,083
and equipment
------------------------------------------------------------------------------------
      Additional purchase price payments           (586,589) (2,523,311)(4,183,439)
------------------------------------------------------------------------------------
      Other assets acquired                          (1,512)   (171,322) (229,857)
------------------------------------------------------------------------------------
     Investment in affiliates                    (2,805,423)          -
------------------------------------------------------------------------------------
     Settlement of share price warranties                    (5,073,339)
------------------------------------------------------------------------------------
      Acquisitions of subsidiaries (net of cash of $nil,
$430,556, 1998: $347,052)                                 -  (2,438,375)(17,881,676)
                                                 ----------   ---------- -----------
------------------------------------------------------------------------------------
Net cash provided by/(used in) investing         (8,712,860) (9,755,784)(22,057,533)
activities                                       ----------- -----------------------
------------------------------------------------------------------------------------
        See accompanying notes to the consolidated financial statements

                                      F-8
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
------------------------------------------------------------------------------------
                                                 Year ended  Year ended Year ended
                                                  June 30,     June 30,  June 30,
                                                      2000         1999      1998
                                                  Restated     Restated  Restated
                                                         $            $         $
------------------------------------------------------------------------------------
Cash flows from financing activities:
------------------------------------------------------------------------------------
      Short term borrowings, net                   301,767      836,250 1,946,515
------------------------------------------------------------------------------------
      Proceeds from long term debt                 234,542    1,317,219 11,683,238
------------------------------------------------------------------------------------
      Repayment of long term debt                (6,227,693)   (200,486)        -
------------------------------------------------------------------------------------
      Redemption of debentures                           -   (2,630,132)        -
------------------------------------------------------------------------------------
      Proceeds on issuance of FSAH mandatory
redeemable                                               -    9,891,197         -
      Preferred stock
------------------------------------------------------------------------------------
     Share issue expenses in subsidiary company          -      (59,489)
------------------------------------------------------------------------------------
     Dividends paid                              (1,342,996)   (284,219)
------------------------------------------------------------------------------------
      Proceeds on minority shares issued in         16,887            -     6,054
Lifestyle
------------------------------------------------------------------------------------
     Proceeds of subsidiary stock issue          18,997,589           -
------------------------------------------------------------------------------------
      Proceeds on issuance of common stock       20,543,100     107,000 2,496,719
                                                 ----------  ---------- ---------
------------------------------------------------------------------------------------
Net cash provided by financing activities        32,523,196   8,977,340 16,132,526
                                                 ----------   --------- ----------
------------------------------------------------------------------------------------
Effect of exchange rate changes on cash          (2,050,261)  3,671,542 (3,944,407)
                                                              --------- -----------
------------------------------------------------------------------------------------
Net increase/(decrease) in cash and cash         9,039,766    2,864,310 (1,940,120)
equivalents
------------------------------------------------------------------------------------
Cash and cash equivalents at beginning of year   20,813,301  17,948,991 19,889,111
                                                 ----------  ---------- ----------
------------------------------------------------------------------------------------
Cash and cash equivalents at end of year         29,853,067  20,813,301 17,948,991
                                                 ==========  ========== ==========
------------------------------------------------------------------------------------
 Supplementary disclosure:
------------------------------------------------------------------------------------
 Interest paid                                   1,363,360   1,298,438    464,165
                                                 =========   =========    =======
------------------------------------------------------------------------------------
 Taxes paid                                      2,218,165   2,170,203  1,532,677
                                                 =========   =========  =========
------------------------------------------------------------------------------------
</TABLE>

See accompanying notes to the consolidated financial statements

                                      F-9
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

1.    ORGANISATION AND PRINCIPAL ACTIVITIES OF THE GROUP

     Silverstar Holdings Limited (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 one of
     investing in Internet and technology related industries.

     The principal activities of the group include the following:

     Internet related activities

     The original investment made in Leisureplanet.com ("LPI"), the Internet
     travel related services company, has been unsuccessful due to a lack of
     further investor funding into the loss making entity, and is currently
     under voluntary administration in the United Kingdom.

     Further investments have been made in Internet technology related
     companies, which is in line with the Company's new focus.

     Discontinued operations

     In addition to LPI, the Lifestyle products segment is also being
     discontinued in line with the shift in strategy of the holding company.

     This segment is involved in the manufacture, sale and distribution of
     lifestyle enhancing products, which includes both consumable food products
     and semi durable outdoor and indoor products.

2.    SUMMARY OF 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:

(a)  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 the equity method of
     accounting. All inter-company accounts and significant transactions have
     been eliminated in the consolidated financial statements.

(b)  Accounting 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.

(c)  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 debt, other than
     convertible debentures; approximates fair values since interest rates are
     keyed to the South African prime-lending rate. The carrying values of
     investments in affiliates and convertible debentures approximate fair
     value.

(d)  Inventories
     Inventories are valued at the lower of cost or market with cost determined
     on the first-in, first-out and weighted average methods.

                                      F-10
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

  2.  SUMMARY OF ACCOUNTING POLICIES (continued)

(e)  Property, plant and equipment
     Property, plant and equipment is recorded at cost. Depreciation is provided
     using the straight-line method over the estimated useful lives of the
     assets. Land is not depreciated. Buildings are depreciated over 20 years.
     Plant and equipment and motor vehicles are depreciated over 3 to 10 years.
     Leasehold improvements are amortised over the terms of the related leases.

(f)  Intangible assets
     Intangible assets include goodwill, patents and trademarks, recipes and
     other intellectual property and non-competition agreements. Intangible
     assets are stated on the basis of cost and are amortised on a straight-line
     basis over a period of three to twenty five years. 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. Should these cash flows not equate or exceed the carrying
     value of the intangible a discounted cash flow model is used to determine
     the extent of any impairment charge required. Goodwill is amortised over a
     period of 3 to 25 years, patents, trademarks, recipes and other
     intellectual property are amortised over a period of 25 years, and
     non-competition agreements are amortised over a 3-year period. Previously,
     non-compete agreements were amortised over 6 years. The effect has been to
     increase the amortisation charge for the year by $156,432.

(g)  Deferred charges
     Debt issue costs are capitalized and amortised over the tenure of the
     related debt. Where convertible debt is converted to equity, any remaining
     debt issue costs are offset against additional paid-in capital.

(h)  Foreign currency translation
     The functional currency of the Company is the United States Dollar, the
     functional currency of the underlying companies in the Lifestyle segment is
     the South African Rand. 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, expenses, gains and losses are
     translated into United States Dollars using the weighted average exchange
     rates for each year. The resultant translation adjustments are reported in
     the component of stockholders' equity designated as accumulated other
     comprehensive income.

     Transactions in foreign currencies arise as a result of inventory purchases
     from foreign countries and inter-company funding transactions between the
     subsidiaries and the Company. Transactions in foreign currencies are
     accounted for at the rates ruling on transaction dates. Exchange gains and
     losses are charged to the income statement during the period in which they
     are incurred.

(i)  Revenues
     Revenues comprise net invoiced sales of shipped Lifestyle enhancing
     products and Internet travel related commissions. Revenues are stated net
     of allowances for estimated returns of defective or damaged product and
     other sales promotions and discounts.

(j)  Income taxes
     Income tax expense is based on reported earnings before income taxes.
     Deferred income taxes are provided utilizing an asset and liability method
     that requires the recognition of deferred tax assets and liabilities for
     the expected future tax consequences of events that have been recognised in
     the Company's financial statements or tax returns. A valuation allowance is
     established to reduce deferred tax assets if it is more likely than not
     that all, or some portion of the deferred tax assets will not be realised.

                                      F-11
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

2.   SUMMARY OF ACCOUNTING POLICIES (continued)

(k)  Net income/(loss) per share
     Basic net income/(loss) per share is computed by dividing net income/(loss)
     by the weighted average number of common shares outstanding. Diluted net
     income/(loss) per share is computed by dividing net income/(loss) by the
     weighted average number of common shares outstanding and dilutive potential
     common shares which includes the dilutive effect of stock options, warrants
     and convertible debentures. Dilutive potential common shares for all
     periods presented are computed utilising the treasury stock method. The
     diluted share base for the years ended June 30, 2000, 1999 and 1998
     excludes shares of 2,997,230, 2,565,817 and 3,208,322, respectively related
     to stock options, warrants and convertible debentures. These shares are
     excluded due to their anti-dilutive effect as a result of the Company's
     loss from continuing operations during 2000, 1999 and 1998.

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

(m)  Restatements and reclassifications
     (i)  Deferred tax expense has been restated for the years ended June 30,
          1999 and 1998 by $597,718 and $1,384,385 respectively to correctly
          reflect the change in deferred tax liabilities related to certain
          intangible assets. The minority interest has been restated for the
          years ended June 30, 1999 and 1998 to reflect the above adjustments by
          $282,608 and $311,864 respectively. The gain/(loss) on sale of
          subsidiary stock between entities under common control has been
          restated for the year ended June 30, 1999 to correctly reclassify the
          loss of $624,554 to additional paid in capital. The gain/(loss) on
          sale of subsidiary stock for the year ended June 30, 1999 has been
          restated by $1,703,748 to record a loss on dilution in Lifestyle which
          was not recorded in the prior year.

                -------------------------------------------------------------
                                                     Previously
                Earnings/(loss) per share - basic    Reported    Restated
                and diluted                                 $           $
                Year ending June 30, 1999
                -------------------------------------------------------------
                Net                                     (1,48)      (1,70)
                                                        ------      ------
                -------------------------------------------------------------
                                                     Previously
                Earnings/(loss) per share - basic    Reported    Restated
                and diluted                                 $           $
                Year ending June 30, 1998
                -------------------------------------------------------------
                Net                                      0,43        0,57
                                                         ----        ----
                -------------------------------------------------------------

     (ii) The Company previously disclosed that it would record a profit from
          the sale of Lifestyle. However, the impact of the accumulated foreign
          currency translation adjustments on the disposition of Lifestyle and
          the impairment of an intangible asset related to a restraint of trade
          agreement were not considered in computing this profit. When these are
          considered, a loss arises on disposition. Consequently the loss on
          disposition of discontinued operations and net loss for the year ended
          June 30, 2000 have been restated by $6,823,816. The balance sheet at
          30 June 2000 and Note 8 have been restated with intangible assets
          reduced by $555,060. Earnings per share, the consolidated statement of
          stockholders equity and comprehensive income and Notes 15 and 16
          relating to discontinued operations have also been restated to reflect
          this change. Earnings per share information, as previously reported
          and as restated is as follows:

                                      F-12
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

                -------------------------------------------------------------
                                                     Previously
                Earnings/(loss) per share - basic    Reported    Restated
                and diluted                                 $           $

                Year ending June 30, 2000
                -------------------------------------------------------------
                Continuing operations                   (0,54)      (0,54)
                -------------------------------------------------------------
                Discontinued operations                 (3,52)      (4,39)
                                                        ------      ------
                -------------------------------------------------------------
                Net                                     (4,06)      (4,93)
                                                        ------      ------
                -------------------------------------------------------------

                Certain items in the prior year financial  statements  have been
                reclassified to conform to the current period presentation.

2.    SUMMARY OF ACCOUNTING POLICIES (continued)

     (n)  Recently issued accounting standards In June 1998, the FASB adopted
          SFAS No. 133, as amended by SFAS No. 137 and SFAS No. 138, "Accounting
          for Derivative Instruments and Hedging Activities." SFAS No. 133
          establishes accounting and reporting standards requiring that every
          derivative instrument (including certain derivative instruments
          embedded in other contracts) be recorded in the balance sheet as
          either an asset or liability measured at its fair value and that
          changes in the derivative's fair value be recognised currently in
          earnings unless specific hedge accounting criteria are met. Special
          accounting for qualifying hedges allows derivatives gains and losses
          to offset related results on the hedged item in the income statement
          and requires that the company must formally document, designate and
          assess the effectiveness of transactions that receive hedge
          accounting. SFAS No. 133 is effective for fiscal years beginning after
          June 15, 2000. The Company believes that the future adoption of this
          statement will not have a significant impact on the results of
          operations or financial position of the Company.

          Staff Accounting bulletin, "SAB" 101 provides the staff's views in
          applying Generally Accepted Accounting Principles to selected revenue
          recognition issues. SAB 101 is effective no later than the fourth
          quarter of fiscal years beginning after December 15, 1999. The Company
          believes that the adoption of the provision of this SAB will not have
          any significant impact on the continuing results of operations and
          financial position.

                                      F-13
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

3.    ACQUISITIONS AND DISPOSALS

     The  results  of  operations  of these  acquisitions  are  included  in the
     consolidated  financial statements from the date of acquisition.  The costs
     of the acquisitions were allocated on the basis of the estimated fair value
     of the assets acquired and liabilities assumed.

    ------------------------------------------------------------------------
                                                  Percentage     Purchase
                                                    Acquired  Consideration
    Subsidiary/business             Date acquired          %            $
    ------------------------------------------------------------------------
    Year ended June 30, 1999
    ------------------------------------------------------------------------
    LPI, Ltd                        January 1,  1999       81     2,868,932
                                                                  ---------
    ------------------------------------------------------------------------
    Year ended June 30, 1998
    ------------------------------------------------------------------------
    Fifers Bakery (Pty) Ltd         July 1, 1997          67    2,294,851
    ------------------------------------------------------------------------
    Pacforce (Pty) Ltd              October 1, 1997      100      618,507
    ------------------------------------------------------------------------
    Galactex (Pty) Ltd              October 1, 1997       84    3,656,646
    ------------------------------------------------------------------------
    Republic Umbrella (Pty) Ltd     October 1, 1997       84    6,512,598
    ------------------------------------------------------------------------
    S.A. Leisure (Pty) Ltd          October 1, 1997       84    8,650,968
    ------------------------------------------------------------------------
    Tradewinds Parasol (Pty) Ltd    March 1, 1998         84    1,229,857
    ------------------------------------------------------------------------
    Cocam Foods (Pty) Ltd           June 1, 1998          67       615,133
                                                              ------------
    ------------------------------------------------------------------------
                                                                23,578,560
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
                                                    Year ended  Year ended
                                                     June 30,    June 30,
                                                         1999        1998
                                                            $           $
     ------------------------------------------------------------------------
    Acquisition costs
     ------------------------------------------------------------------------
         Stock issued in lieu of cash                       -   1,686,730
    ------------------------------------------------------------------------
         Minority contribution to business acquired         -   3,663,102
    ------------------------------------------------------------------------
         Cash consideration                         2,868,932   18,228,728
                                                    ---------   ----------
    ------------------------------------------------------------------------
                                                    2,868,932   23,578,560
    ------------------------------------------------------------------------
    Net assets acquired
    ------------------------------------------------------------------------
         Cash and cash equivalents                    430,556     347,052
    ------------------------------------------------------------------------
         Current assets                               226,907   18,052,553
    ------------------------------------------------------------------------
         Property, plant and equipment                307,168   11,979,546
    ------------------------------------------------------------------------
         Other assets                                       -   5,171,794
    ------------------------------------------------------------------------
         Intangibles                                11,416,020    3,088,954
                                                    ----------  -----------
    ------------------------------------------------------------------------
              Total assets                          12,380,651  38,639,899
                                                    ----------  ----------
    ------------------------------------------------------------------------
         Current liabilities                          828,938   10,514,165
    ------------------------------------------------------------------------
         Long-term debt                             8,682,781   4,494,195
    ------------------------------------------------------------------------
         Deferred income taxes
                                                            -      52,979
    ------------------------------------------------------------------------
          Total liabilities                         9,511,719   15,061,339
                                                    ---------   ----------
    ------------------------------------------------------------------------
                                                    2,868,932   23,578,560
    ------------------------------------------------------------------------

     The Company is required to make  additional  payments to the former  owners
     based on a multiple of pre-tax  earnings.  These payments are to be made by
     the issue of stock and cash.

                                      F-14
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

3.    ACQUISITIONS AND DISPOSALS (continued)

     Additional  purchase  price  payments  made during the  current  year total
     $1,154,296. This amount was allocated as follows:

    ------------------------------------------------------------------------
                                        Year ended  Year ended  Year ended
                                         June 30,    June 30,    June 30,
                                             2000        1999        1998
                                                $           $           $
    ------------------------------------------------------------------------
    Goodwill                              447,507     649,610     2,169,332
    ------------------------------------------------------------------------
    Recipes                               706,789     603,509     1,900,935
    ------------------------------------------------------------------------
    Trademarks                                      2,303,807     1,340,361
                                        ---------------------     ---------
                                                -
    ------------------------------------------------------------------------
                                        1,154,296   3,556,926     5,410,628
                                        ---------   ---------     ---------
    ------------------------------------------------------------------------

     These  additional  purchase  price payments were made and are to be made as
     follows:

    ------------------------------------------------------------------------
                                        Year ended  Year ended  Year ended
                                         June 30,    June 30,    June 30,
                                             2000        1999        1998
                                                $           $           $
    ------------------------------------------------------------------------
    Cash                                  586,589   2,523,311   4,183,439
    ------------------------------------------------------------------------
    Shares issued in lieu of cash          567,707  1,033,615   1,227,189
                                        ----------  ---------   ---------
    ------------------------------------------------------------------------
                                        1,154,296   3,556,926   5,410,628
                                        ---------   ---------   ---------
    ------------------------------------------------------------------------

4.    ACCOUNTS RECEIVABLE

      Accounts receivable consists of the following:

    ------------------------------------------------------------------------
                                                     June 30,    June 30,
                                                         2000        1999
                                                            $           $
    ------------------------------------------------------------------------
    Accounts receivable                             11,034,417   13,388,561
    ------------------------------------------------------------------------
    Less: Allowances for bad debts                    (426,220)    (443,172)
                                                    ----------   ----------
    ------------------------------------------------------------------------
                                                    10,608,197   12,945,389
                                                    ----------   ----------
    ------------------------------------------------------------------------

5.    INVENTORIES

      Inventories consist of the following:

    ------------------------------------------------------------------------
                                                     June 30,    June 30,
                                                         2000        1999
                                                            $           $
    ------------------------------------------------------------------------
    Finished goods                                  5,147,642   4,515,138
    ------------------------------------------------------------------------
    Work in progress                                  358,890     587,544
    ------------------------------------------------------------------------
    Raw materials and ingredients                   2,701,284   2,983,298
    ------------------------------------------------------------------------
    Supplies                                        1,179,041   1,066,595
                                                    ---------   ---------
    ------------------------------------------------------------------------
                                                    9,386,857   9,152,575
    ------------------------------------------------------------------------

                                      F-15
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

6.    PROPERTY, PLANT AND EQUIPMENT

      Property, plant and equipment consists of the following:

    ------------------------------------------------------------------------
                                                     June 30,    June 30,
                                                         2000        1999
                                                            $           $
    ------------------------------------------------------------------------
    Land and buildings                              2,174,364   2,028,094
    ------------------------------------------------------------------------
    Leasehold improvements                          1,265,657   1,203,152
    ------------------------------------------------------------------------
    Plant and equipment                             23,721,346  24,570,108
    ------------------------------------------------------------------------
    Motor vehicles                                  2,325,005   2,508,450
    ------------------------------------------------------------------------
    Construction in progress                            558,416   467,595
                                                    -----------   -------
    ------------------------------------------------------------------------
                                                    30,044,788  30,777,399
    ------------------------------------------------------------------------
    Less: accumulated depreciation                  (11,829,592)(11,488,982)
                                                    ------------------------
    ------------------------------------------------------------------------
    Property, plant and equipment, net               18,215,196 19,288,417
                                                    =========== ==========
    ------------------------------------------------------------------------

     Depreciation  expense was  $2,906,643,  $2,510,953  and  $2,485,838 for the
     years ended June 30,  2000,  1999 and 1998  respectively.  Included in this
     depreciation  expense was  $2,900,153,  $2,506,667  and  $2,480,194  of the
     discontinued operations.

7.    INVESTMENTS IN AFFILIATES

     A summary of the impact of these investments on the consolidated  financial
     statements is presented below:
    ------------------------------------------------------------------------
                                        Effective    June 30,    June 30,
                                        Percentage       2000        1999
                                        Ownership           $           $
    ------------------------------------------------------------------------
    Investments in and receivables
    from unconsolidated affiliates
    ------------------------------------------------------------------------
         HotelSupplyGroup. Com                 51%    183,134           -
    ------------------------------------------------------------------------
         Magnolia Broadband                    48%  1,076,338           -
    ------------------------------------------------------------------------
          Hall Lifestyle Products              50%     24,463           -
                                                       ------     -------
    ------------------------------------------------------------------------
                                                    1,283,935           -
                                                    ---------     -------
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
    Share of losses of unconsolidated affiliates:
    ------------------------------------------------------------------------
         HotelSupplyGroup. Com                 51%    (37,223)          -
    ------------------------------------------------------------------------
         Magnolia Broadband                    48%   (123,662)          -
                                                     ---------    -------
    ------------------------------------------------------------------------
                                                     (160,885)          -
                                                     ---------    -------
    ------------------------------------------------------------------------

     On July 13, 1999 the Company organized a new company,  HotelSupplyGroup.Com
     Limited ("HSG"),  with Intercommerce  Trading Limited.  HSG is 51% owned by
     the Company and 49% by Intercommerce Trading limited.  However, the Company
     does not have a majority voting  interest  therefore HSG has been accounted
     for under the equity method in the consolidated financial statements.

     A  shareholders  loan of  $250,000  has  been  advanced  to HSG as  initial
     funding.  A provision of $35,763 has been raised against the carrying value
     of this  investment,  which represents the deficit of the book value of the
     investment to its net asset value at year-end.

                                      F-16
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

7.    INVESTMENTS IN AFFILIATES (continued)

     On February 21, 2000, the Company  organized a new company,  Hall Lifestyle
     Products (Pty) Ltd ("HLP") and entered into a joint venture  agreement with
     HL Hall & Sons (Group  Services) (Pty) Ltd ("Hall"),  whereby each venturer
     injected an equal sum of R275,000 into a newly formed  entity.  The Company
     and Hall each own 50% of HLP with equal voting rights.

     The  losses  incurred  in HLP of  $23,111  are  included  in the  Lifestyle
     discontinued operation.

     On April 14,  2000,  the  Company  purchased  3,447,774  shares of Series A
     Preferred  stock in Magnolia  Broadband  ("Magnolia")  with  voting  rights
     representing a 48% interest in Magnolia for a consideration of $2,500,000.

     Goodwill  arising on the Company's  investment in Magnolia of $1,300,000 is
     amortised over a three-year period.

8.    INTANGIBLE ASSETS

     Intangible assets consist of the following:

    ------------------------------------------------------------------------
                                                     June 30,    June 30,
                                                         2000        1999
                                                                 Restated
                                                            $           $
    ------------------------------------------------------------------------
    Goodwill                                        5,596,624   15,802,699
    ------------------------------------------------------------------------
    Patents and Trademarks                          5,366,800   6,083,062
    ------------------------------------------------------------------------
    Recipes and other intellectual property         11,590,790  12,451,747
    ------------------------------------------------------------------------
    Non-competition agreements                              -   1,480,465
                                                    ----------  ---------
    ------------------------------------------------------------------------
                                                    22,554,214  35,817,973
    ------------------------------------------------------------------------
    Less: accumulated amortisation                  (2,424,095) (2,082,040)
                                                    ----------- -----------
    ------------------------------------------------------------------------
    Intangible assets, net                          20,130,119  33,735,933
                                                    ==========  ==========
    ------------------------------------------------------------------------

     Amortisation  expense was  $2,934,686,  $1,613,206  and  $1,152,831 for the
     years  ended June 30,  2000,  1999 and 1998  respectively.  Included in the
     amortisation  expense  was  $2,203,967,  $1,209,253  and  $881,444  of  the
     discontinued operations.

                                      F-17
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

9.    DEBT

     Debt consists of the following:
    ------------------------------------------------------------------------
                                                     June 30,    June 30,
                                                         2000        1999
                                                            $           $
    ------------------------------------------------------------------------
    Long term debt
    ------------------------------------------------------------------------
    9% convertible debentures                               -   4,495,000
    ------------------------------------------------------------------------
    Increasing rate convertible debentures          12,000,000  15,000,000
    ------------------------------------------------------------------------
    Debenture redemption reserve fund               2,025,000   1,406,250
    ------------------------------------------------------------------------
    Mortgage loans                                    373,333     489,503
    ------------------------------------------------------------------------
    Equipment notes                                 2,164,047   3,623,319
    ------------------------------------------------------------------------
    Deferred purchase consideration                 1,016,542   1,672,607
    ------------------------------------------------------------------------
    Interest free notes                                     -   10,000,000
                                                    ---------   ----------
    ------------------------------------------------------------------------
                                                    17,578,922  36,686,679
    ------------------------------------------------------------------------
          Less: current portion                     (2,105,153) (3,088,435)
                                                    ----------- -----------
    ------------------------------------------------------------------------
                                                    15,473,769  33,598,244
    ------------------------------------------------------------------------

     9% convertible debentures

     10,000 9%  convertible  debentures of $1,000 each were issued in June 1997.
     These debentures are unsecured,  senior and subordinated,  bearing interest
     at 9% per annum,  payable  quarterly.  The debentures are convertible  into
     shares of common  stock,  by the  debenture  holder,  at any time  prior to
     maturity at a price of $6,00 per share.  The  debentures may be redeemed at
     the option of the  Company  from June 15, 1999  through  June 14, 2003 at a
     redemption premium ranging from 109% to 102,5% of face value,  depending on
     the redemption date.

     The  debentures  have  mandatory  sinking  fund  payments  due in two equal
     installments  totaling 67% of the  outstanding  fair value on June 15, 2002
     and June 15,  2003,  with the  balance of the issue due at maturity on June
     15, 2004.

      The following covenants are in existence:

     A  restriction  has been  placed on the  ability of the  Company to pay any
     dividends  and to repurchase  stock,  except in terms of stock issued under
     escrow agreements to vendors of subsidiaries acquired.

     A restriction has been placed on transactions with affiliates,  whereby all
     transactions  must be no less  favorable  than  those on normal  commercial
     terms.

     The Company may not adopt any plan of liquidation (Bankruptcy).

     During  the  current  financial  year the  remaining  4,495 9%  convertible
     debentures of $1,000 each were converted to shares of common stock.  During
     the  prior  year,  1,924 9%  convertible  debentures  of  $1,000  each were
     converted  to  shares of common  stock and a further  2,734 9%  convertible
     debentures of $1,000 each were repurchased and cancelled.

     During the  current  fiscal  year the  unamortised  debt issue costs of the
     remaining 9% convertible  debentures were offset against additional paid-in
     capital upon  conversion  of these  debentures  to shares of A Class common
     stock.

                                      F-18
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

9.    DEBT (continued)

      Increasing rate convertible debentures

     15,000 increasing rate convertible debentures of $1,000 each were issued on
     October 31, 1997.

     These debentures bear interest at the following rates which is payable
     quarterly:

     4% per annum for the year ending October 31,1998 4,5% per annum for the two
     years ending October 31, 2000 5% per annum for the year ending October 31,
     2001

     The debentures are  convertible  into shares of common stock, at the option
     of the debenture  holder, at any time prior to maturity at a price of $9,50
     per share. The debentures may be redeemed at the option of the Company from
     October 31, 1998 if the  Company's  common stock trades at more than $14,25
     per share for 30  consecutive  market days.  Should the  debentures  not be
     converted  into  shares of common  stock  prior to October  31,  2001,  the
     maturity date, the redemption value of the debentures will be 122,5% of the
     principal amount.

      The following covenants are in existence:

     A  restriction  has been  placed on the  ability of the  Company to pay any
     dividends  and to repurchase  stock,  except in terms of stock issued under
     escrow agreements to vendors of subsidiaries acquired.

     A restriction has been placed on transactions with affiliates,  whereby all
     transactions  must be no less  favorable  than  those on normal  commercial
     terms.

      The Company may not adopt any plan of liquidation (Bankruptcy).

     During the current year 3,000  increasing  rate  convertible  debentures of
     $1,000 each were converted to shares of common stock at $9,50 per share.

      Increasing rate convertible debentures (continued)

     Debt  issue  costs  of  $669,294,  relating  to these  debentures  is being
     amortised  over the tenure of the debenture  issue.  The charge to interest
     expense for the current year is $223,731.  During the current  fiscal year,
     3,000 of the increasing  rate  debentures were converted to A class shares,
     the  unamortised  debt issue costs related to these  debentures  was offset
     against additional paid-in capital.

      Debenture redemption reserve fund

     In terms of the tenure of the  increasing  rate  convertible  debentures  a
     redemption  reserve fund has been created to cater for the premium required
     on the redemption of those  debentures on October 31, 2001.  This debenture
     redemption  reserve fund is being created on the  straight-line  basis over
     the remaining period of the debenture tenure.

     The current year charge to interest  expense for the  debenture  redemption
     reserve is $1,012,500.

                                      F-19
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

9.    DEBT (continued)

     Mortgage loans

     Mortgage loans are  collateralized  by first and second mortgage bonds over
     property with a net book value of $2,174,364.  These loans are repayable in
     equal  monthly  installments  and equal  annual  installments  over periods
     ranging from five to twenty years and bear  interest at rates  ranging from
     13,5% to 14,5%.  Generally  these  interest  rates are  linked to the South
     African prime lending rate which was 14,5% at June 30,2000.

      Equipment notes

     Equipment  notes are  collateralized  over  movable  assets with a net book
     value of $26,048,139.  These loans are generally repayable in equal monthly
     installments over a maximum period of five years. These loans bear interest
     at rates  ranging  from 2% below to 1,75%  above  the South  African  prime
     lending rate, which was 14.5% at June 30, 2000.

      Deferred purchase consideration

     Represents  payments  due to the  previous  owners of Gull Foods and Fifers
     Bakery  which are only  payable at fixed  dates in terms of the  agreements
     entered into with those owners.

      Interest free notes

     Represented loan funds due to the minority shareholders of LPI. This amount
     was interest free and was only repayable when and if LPI produced  positive
     earnings.  Due to the recent voluntary  administration  of LPI, these loans
     will no longer be payable.

   Aggregate  annual  maturities  of  long-term  debt at June 30,  2000  were as
   follows:

    ------------------------------------------------------------------------
                                                                        $
    ------------------------------------------------------------------------
    2001                                                         2,105,153
    ------------------------------------------------------------------------
    2002                                                        14,869,725
    ------------------------------------------------------------------------
    2003                                                           366,994
    ------------------------------------------------------------------------
    2004                                                            93,183
    ------------------------------------------------------------------------
    2005                                                           143,867
                                                                -----------
    ------------------------------------------------------------------------
                                                                17,578,922
    ------------------------------------------------------------------------

10.   FSAH MANDATORY REDEEMABLE PREFERRED STOCK

     On April 16, 1999, FSAH issued 60,000,000  mandatory  redeemable  preferred
     stock for  R60,000,000,  each with a par of R0,001.  FSAH is a wholly owned
     subsidiary of the Company.  The preferred  stock is redeemable on April 17,
     2002 at the original  issue price.  Dividends  on the  preferred  stock are
     equal  to  the  greater  of (i)  the  dividend  declared  by  Lifestyle,  a
     subsidiary of FSAH, listed on the Johannesburg Stock Exchange, or (ii) 125%
     of the prior  years  dividend.  These  dividends  accrue  annually  and are
     payable 3 days after the receipt of the  Lifestyle  dividend or, if no such
     dividend is declared, annually on February 19.

     Lifestyle did not declare a dividend in the current fiscal year.

                                      F-20
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

11.   BANKING FACILITIES

     FSAH, a  wholly-owned  subsidiary of the Company,  has a short term banking
     facility  equal  to  its  exposure  to  certain  South  African   financial
     institutions  on the  strength  of  guarantees  provided  by a pledge of 14
     million shares in Lifestyle,  which  represents 17,3% of FSAH's interest in
     Lifestyle.  This  facility  will need to be  renegotiated  upon the sale of
     Lifestyle.  This  facility  bear  interest at interest  rates linked to the
     prime lending rate, which is currently 14,5%, and is repayable on demand.

     Lifestyle,  the  discontinued  operation,  has a general short term banking
     facility of  $5,921,000  available to it. This facility  bears  interest at
     rates linked to the prime lending rate,  which is currently  14,5%,  and is
     repayable  on demand.  The term of this  facility  is  generally  less than
     twelve months.

12.   FORWARD EXCHANGE CONTRACTS

     The functional  currency of the Company's major South African subsidiary is
     the South African Rand. Due to the volatility of this currency  against the
     currencies of major trading  partners,  forward foreign  currency  exchange
     contracts  are entered  into which  effectively  result in the  purchase of
     foreign  currency at a set value for delivery at a future date.  Unrealized
     gains and losses at June 30, 2000 and 1999 were not material.

13.   GAIN /(LOSS) ON SALE OF SUBSIDIARY STOCK

     The gain on disposal of subsidiary  stock includes any gains or losses made
     on the dilution of the Company's  effective interest in subsidiaries by the
     issuance of shares in its underlying subsidiaries to minority shareholders.

     The  gain/(loss)  on disposal and dilution  recognised in the  consolidated
     statements of operations is made up as follows:

    ------------------------------------------------------------------------
                                        Year ended  Year ended  Year ended
                                         June 30,    June 30,    June 30,
                                             2000        1999        1998
                                                     Restated
                                                $           $           $
    ------------------------------------------------------------------------
    Proceeds received                     421,400   5,712,671   4,358,027
    ------------------------------------------------------------------------
    Less: Net carrying  value of shares
    of First                             (317,895)  (5,097,527) (1,749,193)
                                         ---------  ----------- -----------
    Lifestyle Holdings Limited
    ------------------------------------------------------------------------
                                          103,505       615,144 2,608,834
                                         --------   ----------- ---------
    ------------------------------------------------------------------------
    Loss on dilution in First
    Lifestyle Holdings Limited                  -    (1,419,294)        -
                                         ---------  ----------- -----------
    ------------------------------------------------------------------------
                                          103,505    (804,150)  2,608,834
                                         ---------  ----------- -----------
    ------------------------------------------------------------------------

                                      F-21
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

14.   INCOME TAXES

      The provision for income taxes charged to operations was as follows:

    ------------------------------------------------------------------------
                                        Year ended  Year ended  Year ended
                                         June 30,    June 30,    June 30,
                                             2000        1999        1998
                                                $           $           $
    ------------------------------------------------------------------------
    Current:
    ------------------------------------------------------------------------
          Normal taxation                     619       1,219           -
                                              ---       -----    --------
    ------------------------------------------------------------------------
    Provision for taxes on income             619       1,219           -
                                              ===       =====    ========
    ------------------------------------------------------------------------

     The Company is a Bermuda registered corporation where there are no tax laws
     applicable.

     FSAH, a South African registered corporation, incurred a tax charge of $619
     in the current fiscal year, relating to prior year underprovisions.

     First South Africa Management Corp., an American registered corporation,
     incurred a normal taxation charge of $1,219 in 1999.

   Net deferred tax liabilities is comprised of the following:

    ------------------------------------------------------------------------
                                                     June 30,    June 30,
                                                         2000        1999
                                                                 Restated
                                                            $           $
    ------------------------------------------------------------------------
    Accruals and prepaid expenditure                  203,313     (42,125)
    ------------------------------------------------------------------------
    Assessable losses                                 694,967       582,009
                                                    ---------   -----------
    ------------------------------------------------------------------------
                Gross deferred tax assets              898,280      539,884
                                                    ----------  -----------
    ------------------------------------------------------------------------
    Property, plant and equipment and intangibles   (4,402,038) (3,722,971)
                                                    ----------- -----------
    ------------------------------------------------------------------------
                Gross deferred tax liabilities      (4,402,038) (3,722,971)
                                                    ----------- -----------
    ------------------------------------------------------------------------
    Net deferred tax liability                      (3,503,758) (3,183,087)
                                                    =========== ===========
    ------------------------------------------------------------------------

15.   DISCONTINUED OPERATIONS

     First Lifestyle Holdings Limited ("Lifestyle")

     During the current  fiscal year the Company  changed its focus to investing
     in the Internet and wireless communication  industries.  Although Lifestyle
     has performed well over the past few years, it no longer fits the Company's
     investment  strategy.  On June 21, 2000 the Company  received an offer from
     Lifestyle  management  to buy  Lifestyle  from  the  Company.  The  company
     accepted the offer on September 26, 2000 at a general  meeting of Lifestyle
     shareholders,  which has been  approved  by the South  African  competition
     authorities.

     On August 14,  2000,  the  Company  sold an  effective  13,7%  interest  in
     Lifestyle  to the  existing  Lifestyle  management  as part of the  plan to
     dispose of the Lifestyle segment.  This sale was done on the same terms and
     conditions as the offer made by management to the remaining shareholders as
     contained in a circular to Lifestyle shareholders dated September 4, 2000.

                                      F-22
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

15.   DISCONTINUED OPERATIONS (continued)

     The  following  summarizes  the  remaining  assets and  liabilities  of the
     Lifestyle segment that are included n the accompanying consolidated balance
     sheet at June 30, 2000.

    ------------------------------------------------------------------------
                                                                  June 30,
                                                                     2000
                                                                        $
    ------------------------------------------------------------------------
    ASSETS
    ------------------------------------------------------------------------
    Cash and cash equivalents                                   18,106,098
    ------------------------------------------------------------------------
    Accounts receivable, net                                    10,608,197
    ------------------------------------------------------------------------
    Inventories                                                 9,386,857
    ------------------------------------------------------------------------
    Prepaid expenses and other current assets                   1,528,667
    ------------------------------------------------------------------------
    Deferred income taxes                                           905,533
                                                                -----------
    ------------------------------------------------------------------------
          Total current assets                                  40,535,352
    ------------------------------------------------------------------------
    Property, plant and equipment, net                          18,194,926
    ------------------------------------------------------------------------
    Intangible assets, net                                      18,246,771
    ------------------------------------------------------------------------
    Other assets                                                    55,826
                                                                ----------
    ------------------------------------------------------------------------
                                                                77,032,875
                                                                ----------
    ------------------------------------------------------------------------
    LIABILITIES
    ------------------------------------------------------------------------
    Bank overdraft                                                568,908
    ------------------------------------------------------------------------
    Current portion of long term debt                           1,088,611
    ------------------------------------------------------------------------
    Accounts payable                                            8,291,996
    ------------------------------------------------------------------------
    Other provisions and accruals                               4,257,016
    ------------------------------------------------------------------------
    Dividends payable                                                  87
    ------------------------------------------------------------------------
    Income taxes payable                                          676,003
    ------------------------------------------------------------------------
    Other taxes payable                                           303,812
                                                              -----------
    ------------------------------------------------------------------------
          Total current liabilities                            15,186,433
    ------------------------------------------------------------------------
    Long term debt                                              1,448,769
    ------------------------------------------------------------------------
    Deferred income taxes                                       4,409,291
                                                              -----------
    ------------------------------------------------------------------------
                                                               21,044,493
    ------------------------------------------------------------------------
                                                               55,988,382
    ------------------------------------------------------------------------
     The following summarizes   the   operating   results   of  the   Lifestyle
        discontinued operation:
    ------------------------------------------------------------------------
                                        Year ended  Year ended  Year ended
                                         June 30,    June 30,    June 30,
                                             2000        1999        1998
                                         Restated
                                                $           $           $
    ------------------------------------------------------------------------
    Revenue                             93,292,006  84,944,309  82,759,698
                                        ----------  ----------  ----------
    ------------------------------------------------------------------------
    Operating income                    6,471,842   7,024,057   9,431,814
                                        ---------   ---------   ---------
    ------------------------------------------------------------------------
    Net income, net of minority
    interest of $3,479,293,
    $3,010,194 and $1,704,391           3,188,161   3,685,334   5,566,104
                                        ---------   ---------   ---------
    ------------------------------------------------------------------------
    Provision for loss on disposal      6,823,816             -          -
                                        ---------   ----------- ----------
    ------------------------------------------------------------------------

     Due to historical currency translation adjustments and the impairment of an
     intangible  asset  related to a restraint  of trade  agreement  the company
     anticipates  making a loss on disposal of $6,823,816,  after  adjusting for
     expenses incurred and provision raised relating to the disposal process.

                                      F-23
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

15.   DISCONTINUED OPERATIONS (continued)

     Leisureplanet.com ("LPI")

     Due to the lack of investor  appetite for loss making Internet  businesses,
     no further funding was available to fund the activities of LPI,  previously
     Leisureplanet  Limited, the Internet travel related business.  On August 2,
     2000 LPI was placed under voluntary  administration  in the United Kingdom,
     subsequent  to this date, on August 31, 2000 the  administrator  placed LPI
     into  liquidation.  The  liabilities  of LPI exceed the assets  and,  where
     appropriate,  provision  has been made for any  liabilities,  contingent or
     otherwise,  which the Company may incur.  The remaining  cash is considered
     restricted as a result of the administrative liquidation.

     The following  summarizes the remaining  assets and  liabilities of the LPI
     segment which are included in the accompanying  consolidated  balance sheet
     at June 30, 2000:

    ------------------------------------------------------------------------
                                                    Provision
                                         June 30,   for losses   June 30,
                                             2000    disposal        2000
                                                $           $           $
    ------------------------------------------------------------------------
    ASSETS
    ------------------------------------------------------------------------
    Cash and cash equivalents           4,641,539               4,641,539
    ------------------------------------------------------------------------
    Accounts receivable, net              304,741    (304,741)          -
    ------------------------------------------------------------------------
    Prepaid expenses and other current  25,727,155  (25,727,155)        -
    assets                              ----------  ------------ ---------
    ------------------------------------------------------------------------
          Total current assets          30,673,435  (26,031,896)4,641,539
    ------------------------------------------------------------------------
    Property, plant and equipment, net  1,571,009   (1,571,009)         -
    ------------------------------------------------------------------------
    Intangibles, net                    11,336,630  (11,336,630)        -
                                        ----------  ------------ --------
    ------------------------------------------------------------------------
                                        43,581,074  (38,939,535)4,641,539
    ------------------------------------------------------------------------
    LIABILITIES
    ------------------------------------------------------------------------
    Bank overdraft                          1,510      (1,510)          -
    ------------------------------------------------------------------------
    Accounts payable                    6,864,781   (2,223,242) 4,641,539
    ------------------------------------------------------------------------
    Other provisions and payables       1,004,239   (1,004,239)         -
                                        ---------   ----------  ---------
    ------------------------------------------------------------------------
          Total current liabilities     7,870,530   (3,228,991) 4,641,539
    ------------------------------------------------------------------------
    Long term debt                        4,155,561 (4,155,561)         -
                                        ---------   ----------  ---------
    ------------------------------------------------------------------------
                                        12,026,091  (7,384,552) 4,641,539
    ------------------------------------------------------------------------
    Minority interest                   2,547,488   (2,547,488)         -
    ------------------------------------------------------------------------
    Preference share capital            13,333,333  (13,333,333)        -
                                        ---------   ----------  ---------
    ------------------------------------------------------------------------
                                        27,906,912  (23,265,373)4,641,539
                                        ----------  ----------- ---------
    ------------------------------------------------------------------------
                                        15,674,162  (15,674,162)        -
                                        ----------  ----------- ---------
    ------------------------------------------------------------------------

     The following summarizes the operating results of the LPI segment:

    ------------------------------------------------------------------------
                                                    Year ended  Year ended
                                                     June 30,    June 30,
                                                         2000        1999
                                                            $           $
    ------------------------------------------------------------------------
    Revenue                                           546,942     164,486
                                                      -------     -------
    ------------------------------------------------------------------------
    Operating loss                                  (30,124,852)(6,231,845)
                                                    -----------  ----------
    ------------------------------------------------------------------------
    Net loss, net of minority interest of           (15,119,447)(6,167,662)
    $14,598,890 and $nil                            -----------  ----------
    ------------------------------------------------------------------------

                                      F-24
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

15.   DISCONTINUED OPERATIONS (continued)

     During the prior fiscal year the Company completed the  discontinuation  of
     its  operations in the  Industrial  manufacturing  and  Packaging  business
     segments in order to concentrate  all of its efforts on its core operations
     of Lifestyle enhancing products and Internet travel related businesses.

   The  following  summarizes  the  operating  results  of  the  industrial  and
   packaging business segments:

    ------------------------------------------------------------------------
                                                    Year ended  Year ended
                                                      June 30,    June 30,
                                                          1999        1998
                                                             $           $
    ------------------------------------------------------------------------
    Revenue                                         18,492,864  30,648,652
                                                    ----------  ----------
    ------------------------------------------------------------------------
    Operating loss                                    (695,700) (1,371,879)
                                                    ----------- -----------
    ------------------------------------------------------------------------
    Net loss                                        (1,458,991) (2,178,473)
                                                    ----------- -----------
    ------------------------------------------------------------------------
    Loss on disposal of discontinued operations       (612,858)          -
    ------------------------------------------------------------------------
    Write off of development costs incurred on
    Processed food pie business                       (362,090)          -
                                                    -----------  ----------
    ------------------------------------------------------------------------
                                                      (974,948)          -
                                                      ---------  ---------
    ------------------------------------------------------------------------
    Net loss on discontinued operations             (2,433,939) (2,178,473)
                                                    =========== ===========
    ------------------------------------------------------------------------
      The Company disposed of the following subsidiaries:
    ---------------------------------------------------------------------------
                                                               Proceeds on
                                                                  Disposal
    Subsidiary/business                           Date disposed         $
    ------------------------------------------------------------------------
    Industrial manufacturing segment
    ------------------------------------------------------------------------
          Humidair (Pty) Ltd                       July 1, 1998    58,824
    ------------------------------------------------------------------------
          First Strut (Pty) Ltd                December 1, 1998         -
    ------------------------------------------------------------------------
          Europair Africa (Pty) Ltd               March 1, 1999         -
    ------------------------------------------------------------------------
          LS Pressings (Pty) Ltd                    May 1, 1999   495,050
    ------------------------------------------------------------------------
    Packaging segment
    ------------------------------------------------------------------------
          Pakmatic Company (Pty) Ltd              April 1, 1999         -
    ------------------------------------------------------------------------
          Starpak (Pty) Ltd                       April 1, 1999         -
    ------------------------------------------------------------------------
          Pacforce (Pty) Ltd - cessation of       June 30, 1999         -
    operations
    ------------------------------------------------------------------------
    Total disposal consideration                                  553,874
                                                                  -------
    ------------------------------------------------------------------------

                                      F-25
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

15.      DISCONTINUED OPERATIONS (continued)

     Where no disposal proceeds are recorded, the liabilities generally exceeded
     the assets of the company concerned,  with the exception of Europair Africa
     and  Pakmatic   Company,   where  the  vendors   were   required  to  repay
     shareholders' loans back to the Company.

    ------------------------------------------------------------------------
                                                                          $
    ------------------------------------------------------------------------
    Assets and liabilities disposed of:
    ------------------------------------------------------------------------
          Current assets (including cash of $462,156)             8,983,186
    ------------------------------------------------------------------------
          Property, plant and equipment                           3,149,176
    ------------------------------------------------------------------------
          Goodwill                                                  901,340
    ------------------------------------------------------------------------
          Other assets                                              124,057
    ------------------------------------------------------------------------
    Total assets sold                                            13,157,759
                                                                 ----------
    ------------------------------------------------------------------------
          Current liabilities                                   (11,510,761)
    ------------------------------------------------------------------------
          Long term debt                                         (1,839,722)
    ------------------------------------------------------------------------
          Deferred taxes                                            (19,351)
    ------------------------------------------------------------------------
          Other liabilities                                          (1,205)
    ------------------------------------------------------------------------
    Total liabilities sold                                      (13,371,039)
                                                                ------------
    ------------------------------------------------------------------------
                                                                   (213,280)
    ------------------------------------------------------------------------

16.   CASH FLOWS

     The changes in assets and liabilities consist of the following:

    ------------------------------------------------------------------------
                                        Year ended  Year ended  Year ended
                                         June 30,    June 30,    June 30,
                                             2000        1999        1998
                                                $           $           $
    ------------------------------------------------------------------------
    (Increase)/decrease in accounts      (837,497)  (1,609,848) 1,251,842
    receivable
    ------------------------------------------------------------------------
    (Increase)/decrease in inventories  (1,415,494) (1,257,940)  (956,318)
    ------------------------------------------------------------------------
    Increase in prepaid expenses and
    other current                       (2,245,402) (3,758,667)  (169,887)
    Assets
    ------------------------------------------------------------------------
    Increase/(decrease) in accounts     7,259,517   2,141,313    (894,445)
    payable
    ------------------------------------------------------------------------
    Increase in other provisions and    1,703,222   5,398,166           -
    accruals
    ------------------------------------------------------------------------
    Increase in other taxes payable      (202,532)      8,483     676,319
    ------------------------------------------------------------------------
    (Decrease)/increase in income
    taxes payable                        (423,369)   (380,001)    513,573
                                         --------    --------     -------
    ------------------------------------------------------------------------
                                        3,838,445     541,506     421,084
                                        =========   =========     =======
    ------------------------------------------------------------------------

                                      F-26
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

16.   CASH FLOWS (continued)

    ------------------------------------------------------------------------
                                        Year ended  Year ended  Year ended
                                         June 30,    June 30,    June 30,
                                             2000        1999        1998
                                         Restated
                                                $           $           $
    ------------------------------------------------------------------------
    Dividends paid is reconciled to
    the cash flow as follows:
    ------------------------------------------------------------------------
    Movement in opening and closing     (1,572,434) 1,315,222           -
    balances
    ------------------------------------------------------------------------
    Minority dividend movements           379,193   (1,103,450)         -
    ------------------------------------------------------------------------
    Dividend charge                      (149,755)   (495,991)          -
                                         --------    --------    ----------
    ------------------------------------------------------------------------
    Dividend paid                       (1,342,996)  (284,219)          -
                                        ----------- ----------   -----------
    ------------------------------------------------------------------------
    Net cash provided by/(used in)
    discontinued operations consists
    of the following:
    ------------------------------------------------------------------------
    Net income/(loss) of discontinued   (34,429,264)(4,916,267) 3,387,631
    operations:
    ------------------------------------------------------------------------
    Provision for losses on             22,497,978          -           -
    discontinuance
    ------------------------------------------------------------------------
    Depreciation and amortisation       4,549,060   3,715,552   3,361,638
    ------------------------------------------------------------------------
    Minority share of (losses)/gains  (11,119,597)  3,010,194   1,704,922
    ------------------------------------------------------------------------
    Interest in losses of affiliates       23,111           -
    ------------------------------------------------------------------------
    Shares to be issued                 3,446,633           -           -
    ------------------------------------------------------------------------
    Loss on sale of shares                      -    (767,262)          -
    ------------------------------------------------------------------------
                                      (15,032,079)  1,042,217   8,454,191
    ------------------------------------------------------------------------

17.   EMPLOYMENT BENEFITS

     The  Company  does not  maintain  retirement  funds for the  benefit of its
     employees of its continuing operations.

     The Company and employees of continuing  operations  participate in various
     health plans, which provide medical cover for employees on an annual basis.
     Neither  the health  plan nor the  Company  are liable for post  retirement
     medical  costs.  The  contributions  to the  health  plan are  borne by the
     Company.  The Company has no  liability  for  employees'  medical  costs in
     excess of the contributions to the health plan.

     The Company's contribution to these health plans was as follows:

    ------------------------------------------------------------------------
                                        Year ended  Year ended  Year ended
                                         June 30,    June 30,    June 30,
                                             2000        1999        1998
                                                $    Restated    Restated
                                                            $           $
    ------------------------------------------------------------------------
                                            6,927           -           -
                                            -----   ---------   ---------
    ------------------------------------------------------------------------

                                      F-27
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

18.   BUSINESS SEGMENT INFORMATION

     In the previous year the Company had two reportable segments which included
     strategic  business  units that offered  different  products and  services.
     These  business  units were both managed  separately  as each unit was in a
     different  technological  and  marketing  field.  Both of  these  segments,
     Internet travel related businesses and Lifestyle  enhancing  products,  are
     reported as discontinued  operations in the current year as the company has
     changed its focus to investing in Internet technology companies and related
     service  industries.  As a result, as of June 30, 2000 the Company operates
     in only one segment.  This segment currently  generates no revenues and all
     significant  identifiable  assets  are  located  in the  United  States and
     Israel.

19.   STOCK OPTION PLAN

     The board of directors  have adopted the Company's  1995 Stock Option Plan.
     The  Stock  Option  Plan  provides  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 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 Plan is to be 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 Plan also  contains an automatic  option grant program for
     the employee  and  non-employee  directors.  Each person who is an employee
     director of the Company  following an annual meeting of  shareholders  will
     automatically be granted an option for an additional 5,000 shares of common
     stock,  non-employee  directors  will  receive an option for an  additional
     10,000 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 has granted options to purchase  590,000 shares of common stock
     under the Plan, of which 30,000  options have been  exercised.  The options
     issued under the stock option still  outstanding are reflected in the table
     below.

                                      F-28
<PAGE>
                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

     Option activity under the stock option plans is summarised as follows:

    ------------------------------------------------------------------------
                                                       Shares     Weighted
                                                    Subject to     Average
                                                      Options     Exercise
                                                    Outstanding     price
                                                                 Per option
    ------------------------------------------------------------------------
    Balance at July 1, 1997                           395,000         3,78
    ------------------------------------------------------------------------
    Granted - non plan options                        500,000         4,75
    ------------------------------------------------------------------------
    Granted - plan options                             40,000         5,00
    ------------------------------------------------------------------------
    Exercised - plan options                          (10,000)        4,38
                                                     ---------
    ------------------------------------------------------------------------
    Balance at June 30, 1998                          925,000         4,40
    ------------------------------------------------------------------------
    Granted - plan options                            135,000         2,75
    ------------------------------------------------------------------------
    Exercised                                         (20,000)       5,19
                                                    -----------
    ------------------------------------------------------------------------
    Balance at June 30, 1999                        1,040,000         4,21
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
    Granted - non plan options                        600,000         4,88
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
    Granted - plan options                             60,000         3,76
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
    Exercised - non plan options                     (100,000)        2,00
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
    Exercised - plan options                          (80,000)        4,75
                                                     ---------
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
    Balance at June 30, 2000                        1,520,000         4,54
                                                    ---------
    ------------------------------------------------------------------------

19.   STOCK OPTION PLAN (continued)

     Significant option groups outstanding at June 30, 2000 and related weighted
     average exercise price and weighted average remaining life are as follows:

    ------------------------------------------------------------------------
                  Options outstanding     Options exercisable
    ------------------------------------------------------------------------
    Range of                  Weighted               Weighted      Weighted
    exercise                   Average                Average       Average
    prices                    Exercise               Exercise     Remaining
                    Shares       Price     Shares       Price          Life
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
                                                                  7 Years 4
    $1,00 to       165,000        1,81    165,000        1,81        months
    $2,19
    ------------------------------------------------------------------------
    $3,75 to                                                      8 Years 3
    $4,875       1,075,000        4,81    435,000        4,72        months
    ------------------------------------------------------------------------
    $5,00 to         280,000      5,13    280,000        5,13       5 Years
    $6,00        -----------      ----    -------        ----
    ------------------------------------------------------------------------
                  1,520,000       4,54    880,000        4,30
                 ----------       ----    -------        ----
    ------------------------------------------------------------------------

     The Company measures  compensation cost for its stock option plan using the
     intrinsic value based method of accounting.

     Had the Company used the fair  value-based  method of accounting to measure
     compensation  expense  for it  stock  option  plans  beginning  in 1997 and
     charged  compensation cost against income, over the vesting periods,  based
     on the  fair  value  of  options  at the  date of the  grant,  income  from
     continuing  operations and the related diluted per common share amounts for
     1999,  1998 and 1997 would  have been  reduced  to the  following  proforma
     amounts:

    ------------------------------------------------------------------------
                                             2000        1999        1998
                                                     Restated    Restated
                                                $           $           $
                                                                ------------
    ------------------------------------------------------------------------
    Net income/(loss) from continuing
    operations
                                                                ------------
    ------------------------------------------------------------------------
          As reported                   (4,233,222) (6,210,195)  (615,740)
                                                                ------------
    ------------------------------------------------------------------------
                Proforma                (6,809,446) (7,895,108) (3,683,094)
                                                                ------------
    ------------------------------------------------------------------------
    Basic and diluted (loss)/income
    per common share
    ------------------------------------------------------------------------
          As reported                      ($0,54)     ($0,95)     ($0,10)
    ------------------------------------------------------------------------
                Proforma                   ($0,86)     ($1,21)     ($0,57)
    ------------------------------------------------------------------------

     The weighted average grant date fair value of options granted in 2000, 1999
     and 1998 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:

    ------------------------------------------------------------------------
                                               2000        1999        1998
    ------------------------------------------------------------------------
    Weighted average grant-date fair
    value of options                          $4,07       $4,51       $6,82
    Granted
    ------------------------------------------------------------------------
    Assumptions:
    ------------------------------------------------------------------------
                Risk free interest rate      14,96%      14,96%       14,0%
    ------------------------------------------------------------------------
                Expected life               4 Years     5 Years     5 Years
    ------------------------------------------------------------------------
                Expected volatility         106.45%      108,6%       87,3%
    ------------------------------------------------------------------------
                Expected dividend yield        0,0%        0,0%        0,0%
    ------------------------------------------------------------------------

                                      F-29
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

20.   WARRANTS OUTSTANDING

     In connection with the initial public offering ("the offering") consummated
     in January  1996 the  Company  issued  2,300,000  units.  Each unit  issued
     consisted of one share of common stock,  one redeemable Class A warrant and
     one redeemable Class B warrant.  In addition,  100,000 warrants were issued
     to the underwriter  pursuant to the  underwriting  agreement.  Concurrently
     with the offering  the selling  security  holder  offered  650,000  selling
     security holder warrants,  650,000 selling security holder Class B warrants
     issuable  upon  exercise  of  the  selling  security  holder  warrants  and
     1,300,000  shares of common stock  issuable  upon exercise of these selling
     security  holder  warrants  and selling  security  holder Class B warrants.
     These  selling  security  holder  warrants  are  identical  to the  Class A
     warrants,  except  that there are  certain  restrictions  imposed  upon the
     transferability of these warrants.

     In consideration for the 9% debenture  offering the Company issued warrants
     over  135,000  shares of  common  stock at an  exercise  price of $6,00 per
     share, the fair market price at date of issuance.

     In  consideration  for the capital raising exercise  undertaken  during the
     current year the Company  issued  warrants  over  150,000  shares of common
     stock at an exercise price of $0,01 per share.

     In terms of an agreement entered into with Infospace, the Company undertook
     to issue  warrants over 720,000  shares of common stock valued at $5,00 per
     share.   Infospace  were  to  provide  services  to  the  Leisureplanet.com
     subsidiary  in  exchange  for  the  Company   increasing   its  holding  in
     Leisureplanet.com equal to the value placed on the warrants. These warrants
     have an exercise price of $0,01 per share. As at June 30, 2000,  480,000 of
     these warrants have vested and 240,000 were issued.

     Warrants  over 25,000 of the  debenture  warrants and 57,811 of the Class A
     Redeemable warrants were exercised during the current year.

      Warrants outstanding at June 30, 2000 were as follows:

    ------------------------------------------------------------------------
                      Number of   Exercise
    Warrant            Warrants      Price   Expiry date Entitlement
    ------------------------------------------------------------------------
    Class A                                              One share of common
    Redeemable                               January 24, stock and one
    Warrants          1,015,938      $6,50        2001   Class B
                                                         warrant
    ------------------------------------------------------------------------
    Class B
    Redeemable                               January 24, One share of common
    Warrants          2,101,547      $8,75        2001   Stock
    ------------------------------------------------------------------------
                                              July 31,   One share of common
    Debenture warrants  110,000      $6,00        2007   Stock
    ------------------------------------------------------------------------
    Capital raising                                      One share of common
    Warrants            150,000      $6,00               Stock
    ------------------------------------------------------------------------
                                                         One share of common
    Infospace warrants  240,000      $0,01               Stock
    ------------------------------------------------------------------------

     The Class A warrants are redeemable  beginning January 24, 1997, or earlier
     at the option of the Company with the underwriters consent, at a redemption
     price of $0,05 per Class A warrant, if the "closing price" of the Company's
     common  stock  trades at an average  price in excess of $9,10 per share for
     any consecutive 30 trading day period,  ending within 15 days of the notice
     of  redemption.  All Class A warrants  are to be  redeemed if any are to be
     redeemed.

                                      F-30
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

     The Class B warrants are redeemable  beginning January 24, 1997, or earlier
     at the option of the Company with the underwriters consent, at a redemption
     price of $0,05 per Class A warrant, if the "closing price" of the Company's
     common stock  trades at an average  price in excess of $12,25 per share for
     any consecutive 30 trading day period,  ending within 15 days of the notice
     of  redemption.  All Class B warrants  are to be  redeemed if any are to be
     redeemed.

21.   FIRST SOUTH AFRICAN HOLDINGS ESCROW AGREEMENT

     The  FSAH  Escrow  Agreement  was  executed  prior  to the  closing  of the
     Company's offering and provided for the concurrent issuance and delivery of
     729,979  shares of Class B common stock to the FSAH escrow agent.  The FSAH
     Escrow  Agreement  is intended to provide  security for the holders of FSAH
     Class B common stock,  who are residents in South Africa and are prohibited
     in terms of South African law from holding shares in a foreign company. The
     FSAH Escrow Agreement  provides that the parties to this agreement that are
     holders  of FSAH Class B common  stock will not sell such  shares of stock,
     but may  tender  the  shares  to the  FSAH  escrow  agent  against  payment
     therefore by the escrow  agent,  which  payment may consist of the proceeds
     obtained  from the sale of an equal  number of Class B common  stock of the
     Company,  provided  that the  proceeds of the sale will be delivered to the
     holder  of the Class B common  stock in  exchange  for the  shares in FSAH.
     These  shares will be tendered to the Company and they will be  immediately
     converted to FSAH Class A common stock.

     Since the  consummation  of the  Company's  offering in January  1996,  the
     Company has entered into FSAC Escrow Agreements with the FSAH escrow agent,
     FSAH and certain  principal  shareholders  of the  Company's  subsidiaries,
     which  were  acquired  since  January  1996.  The terms of the FSAC  Escrow
     Agreement  are  substantially  similar  to the  terms  of the  FSAH  Escrow
     Agreement,  except that the FSAH Escrow Agreement provided for the issue of
     shares  of Class B common  stock to the FSAH  escrow  agent  while the FSAC
     Escrow  Agreements  provide for the issue of shares of common  stock to the
     FSAH escrow agent which correspond to the issuance's of FSAH Class B common
     stock by FSAH.

     In 2000 a further  120,621  shares of common  stock were issued to the FSAH
     escrow  agent in  terms of the FSAC  Escrow  agreements  entered  into,  in
     connection with the acquisition of Gull Foods.

     No further shares of common stock are to be issued in terms of FSAC or FSAH
     escrow agreements.

     In terms of the  agreements  entered  into  with the  previous  vendors  of
     Piemans  Pantry,  Seemann's  Quality Meat  Products,  Gull Foods and Fifers
     Bakery,  the underlying  value of the FSAC escrow stock was  underpinned at
     certain  minimum  values.  The  previous  vendors had the option to put the
     shares to the Company at those  values,  which was  obligated  to honor the
     minimum values placed on those shares.  These vendors exercised this option
     during  the  prior  fiscal  year,  which  resulted  in the  redemption  and
     cancellation of 1,583,059 FSAC A class common stock.

      There are no further stock price warranties outstanding.

22.   COMMITMENTS AND CONTINGENCIES

     South African  Secondary Tax on Companies at 12,5 percent is payable on all
     dividends   declared  out  of  distributable   reserves  of  South  African
     companies.

     The  Company  is  liable  to pay  to  the  previous  vendors  an  estimated
     $1,016,542  based on the  attainment  of profit  warranties  which  form an
     integral part of all acquisition agreements concluded with previous vendors
     of acquired  companies.  The payment of this amount is  dependent  upon the
     achievement of pre defined profit targets.

     The company has ,guaranteed the banking facilities of certain of its
     subsidiaries previously disposed of during the prior year. These
     guarantees amount to $1,580,000

     The  Future  minimum  non-cancellable  operating  lease  payments  are  not
     material.

                                      F-31
<PAGE>

                           SILVERSTAR HOLDINGS LIMITED
                NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

23.  QUARTERLY INFORMATION

     The Company restated the presentation of certain  information for the first
     three quarters.  Net  income/(loss) has been restated by an equal charge of
     $107,027 for each of the quarters  ended  September 30, 1999,  December 31,
     1999 and March 31, 2000 to  correctly  reflect  the change in deferred  tax
     liabilities related to certain intangible assets.  Operating  income/(loss)
     and net income/(loss) has been restated in the quarters ended September 30,
     1999,  December  31,  1999 and  March 31,  2000 by  $39,934,  $289,796  and
     $434,651  respectively  to correctly  reflect the  amortisation  of prepaid
     assets  which  was  recorded  in the  quarter  ended  June  30,  2000.  Net
     income/(loss)  has been restated by $393,750 in the quarter ended March 31,
     2000 to  correctly  reflect  transfer  of capital  redemption  reserve,  on
     conversion of debentures into shares, to additional paid in capital.  Other
     income and net income/(loss) has been restated by $6,308,858 and $2,320,999
     in the quarter ended December 31, 1999 and the quarter ended March 31, 2000
     respectively,  to correctly reflect the gain made on dilution of investment
     in LPI, to additional paid in capital.

    ------------------------------------------------------------------------
                                        Quarters ended
    ------------------------------------------------------------------------
                                        September    December       March
                                              30,         31,         31,
                                             1999        1999        2000
                                                $           $           $
    ------------------------------------------------------------------------
    Revenues                            22,721,938  30,055,350  21,100,519
                                        ----------  ----------  ----------
    ------------------------------------------------------------------------
    Operating income/(loss)             (1,687,277)  (864,056)  (7,618,889)
    ------------------------------------------------------------------------
    Net income/(loss)                   (2,980,397) (2,163,504) (4,623,494)
    ------------------------------------------------------------------------
    ------------------------------------------------------------------------
    Net income/(loss) per share -          ($,047)     ($0,30)     ($0,51)
    basic and diluted
    ------------------------------------------------------------------------
    Weighted average common stock
    outstanding -                       6,377,981   7,153,185   9,002,398
    Basic and diluted
    ------------------------------------------------------------------------


                                      F-32
<PAGE>

ITEM 9.  Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure

      Not applicable.

Part III

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:

             Name               Age                     Positions
    ----------------------------------------------------------------------------
    Michael Levy...........     54      Chairman of the Board

    Clive Kabatznik........     44      Vice Chairman of the Board, Chief
                                        Executive Officer, President and Chief
                                        Financial Officer
    Cornelius J. Roodt.....     41      Director

    David BenDaniel........     68      Director

    Chris Matty............     32      Director

    Mark J. Korb...........     32      Chief Financial Officer of First South
                                        African Holdings (Pty.) Ltd.

      Michael Levy is our co-founder and has served as Chairman of our Board
of Directors since our inception.  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 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 has
led the buyout of First Lifestyle Holdings and will no longer act as 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.

                                      -16-
<PAGE>

      David BenDaniel, Ph.D. has been a professor at Cornell University since
1985 and is currently the Berens Professor of Entrepreneurship at the Johnson
Graduate School of Management at Cornell University.  Dr. BenDaniel is the
co-editor of International M&A, Joint Ventures and Beyond - Doing the Deal,
printed in 1998.  Dr. BenDaniel holds a B.A. and M.S. in Physics from the
University of Pennsylvania and a Ph.D. in Engineering from the Massachusetts
Institute of Technology.

      Chris  Matty  has  been  Vice  President  of  Strategic   Development  for
InfoSpace.com,  Inc., an aggregator of content on the Internet,  since  February
1997.  Prior to that time, Mr. Matty was a consultant for Wiredweb,  an Internet
service  provider,  from December 1996 to February  1997. In May 1996, Mr. Matty
founded  Environmental  Products,  a recycling company,  and was responsible for
finance and marketing of that company until December 1996. From June 1994 to May
1996,   Mr.   Matty  was   Program   Manager   at  Clarion   Communications,   a
telecommunications  company, where he was responsible for international business
development.

      Mark J.  Korb has been  the  Group  Finance  Director  of First  Lifestyle
Holdings since April 1997.  Prior to such time,  from August 1993 to March 1997,
Mr.  Korb was an  employee  of  PricewaterhouseCoopers  Inc,  as a Senior  Audit
Manager  from July 1994 to March  1997 and a Manager  from  August  1993 to June
1994.

      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.

Committees of the Board of Directors

      Our  Board  of  Directors  has  an  audit  committee  and  a  compensation
committee.  The audit committee is composed of Chris Matty, David BenDaniel, and
Michael Levy. The audit  committee is responsible for  recommending  annually to
the Board of Directors the independent  auditors to be retained,  reviewing with
the  independent  auditors  the scope and  results of the audit  engagement  and
establishing and monitoring our financial policies and control procedures.

      The compensation committee is currently composed of Michael Levy and Chris
Matty.  The  compensation  committee has power and authority with respect to all
matters  pertaining to compensation and the administration of employee benefits,
deferred compensation and our stock option plans.

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, 2000 were timely made.

Item 11.  Executive Compensation

      The  following  summary   compensation  table  sets  forth  the  aggregate
compensation  we paid or  accrued  to our  Chief  Executive  Officer  and to the
Managing Director and Chief Financial  Officer of our subsidiaries,  First South
African Holdings (Pty.) Ltd. and First Lifestyle Holdings Ltd. during the fiscal
years ended June 30, 1997, June 30, 1998, June 30, 1999 and June 30, 2000. Apart
from Mr. Kabatznik, whose annual salary is $300,000, and Mr. Roodt, whose annual
salary is $150,000,  none of our executive  officers or any of our  subsidiaries
received compensation in excess of $100,000.

                                      -17-
<PAGE>
<TABLE>
<CAPTION>
                           Summary Compensation Table

                           Annual Compensation               Long Term Compensation
                          -----------------------           ------------------------
Name               Fiscal
Name and           Year                          Other                   Securities
Principal          Ended     Salary    Bonus     Annual      Restricted  Underlying
Position           June                          Compen-     Stock       Stock
                    30,                          sation      Awards      Options
----------------- -------- ---------- --------- ---------  ------------  -----------
                               $         $
<S>                 <C>      <C>             <C>                         <C>
Clive Kabatznik,    2000     230,000         0      ---         ---     255,000
President and       1999     180,000         0                            5,000
Chief Executive     1998     180,000   170,509                           255,000
Officer

Cornelius J.         2000   150,000        0                              5,000
Roodt, Managing      1999   150,000        0        ---         ---       5,000
Director and Chief   1998   150,000   170,509       ---         ---      255,000
Financial Officer
of First South
African Holdings
(Pty.) Ltd. and
First Lifestyle
Holdings Ltd.
</TABLE>
      The options  granted to Mr.  Kabatznik  during  fiscal year ended June 30,
2000 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 $5.125 per share; and

         o a non-plan  option  granted  by our Board of  Directors  to  purchase
250,000 shares of our common stock which is currently exercisable at an exercise
price of $4.875 per share.

      The options  granted to Mr. Roodt  during  fiscal year ended June 30, 2000
were granted  under our 1995 Stock Option Plan and  represent,  in each case, an
option  to  purchase  5,000  shares  of our  common  stock  which  is  currently
exercisable at an exercise price of $5.125 per share.

      The options  granted to Mr.  Kabatznik  and Mr. Roodt  during  fiscal year
ended June 30, 1999 were granted under our 1995 Stock Option Plan and represent,
in each case,  an option to purchase  5,000  shares of our common stock which is
currently exercisable at an exercise price of $2.19 per share.

      The options granted to Mr. Kabatznik and Mr. Roodt during fiscal year
ended June 30, 1998 represent, in each case:

         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 $6.00 per share; and

                                      -18-
<PAGE>
Options Granted in Fiscal 2000

         o a non-plan  option  granted  by our Board of  Directors  to  purchase
250,000 shares of our common stock which is currently exercisable at an exercise
price of $4.75 per share.

      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,
2000,  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
                                 ---------------
                                Percent of                         Potential Realizable
                    Number of     Total       Per                    Value at Assumed
                    Securities      to       Share                        Annual
                    Underlying  Employees in Exercise Expiration   Rate of Stock Price
Name                Options     Fiscal Year  Price       Date           Appreciation
------------------  ----------  ------------ -------- ---------     For Option Term
                                                                        5%       10%
                                                                        -        --
<S>                  <C>        <C>          <C>            <C> <C>   <C>       <C>
Clive Kabatznik      250,000    49.00%       $4.875  August 15, 2010  $336,718  $744,059.00

Clive Kabatznik        5,000     1.00%       $5.125  May 1, 2005      $7080.00  $ 15,644.32

Cornelius J. Roodt     5,000     1.00%       $5.125  May 1, 2005      $7080.00  $ 15,644.32
</TABLE>

Aggregated Option Exercises In Last Fiscal Year And Fiscal Year-End Option
Values

      During the fiscal year ended June 30, 2000,  Mr. Roodt  exercised  180,000
options. 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, 2000.  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,  2000,  or  $3.25,  over the
exercise price of the option.

                       Number of Securities    Value of Unexercised In
                            Underlying                the Money
                      Unexercised Options at      Options at Fiscal
                          Fiscal Year-End             Year-End
                       --------------------    -----------------------
Name of Executive   Exercisable Unexercisable  Exercisable   Unexercisable
Officer
-----------------   ----------- -------------  -----------   -------------

Clive Kabatznik           558,333     166,666       $5,300           $0

Cornelius J. Roodt        240,000           0      $92,800           $0


                                      -19-
<PAGE>

Director Compensation

      Except for Mr. Levy, our directors do not receive fixed  compensation  for
their services as directors  other than options to purchase 10,000 shares of our
common stock granted to each non-employee director and options to purchase 5,000
shares of our common stock granted to each director who is an employee,  in each
case under our 1995 Stock Option Plan.  Mr. Levy  receives an annual  consulting
fee of $60,000  and options to purchase  10,000  shares of our common  stock for
every  year of  service  as a member of our Board of  Directors.  Directors  are
reimbursed for their reasonable  out-of-pocket  expenses  incurred in connection
with their duties.

Employment Agreements

      On April 12, 2000,  the Company's  Board of Directors  approved an Amended
and  Restated  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  February  1, 2000 and  continuing  through  and until
January 31, 2005. As compensation  for his services,  Mr. Kabatznik will receive
an annual base salary of $300,000 (with five percent  increases each year),  and
an annual  bonus of five percent of net  realized  capital  gains upon the sale,
liquidation or distribution by the Company of any Portfolio  Company (as defined
in the Employment  Agreement).  A Portfolio  Company does not include any of the
South African entities currently owned by the Company.  In the event of a Change
in Control (as defined in the Employment  Agreement),  Mr. Kabatznik may also be
entitled to a payment of five percent of any net unrealized capital gains on any
Portfolio  Company,  which gains may, at the option of the  Company,  be paid in
cash, stock of the Portfolio Company or any combination of the foregoing.

      First South African Holdings (Pty.) Ltd. has entered into an employment
agreement with its Managing Director and Chief Financial Officer, Cornelius
J. Roodt.  The agreement provides for a term commencing on July 1, 1996 and
terminating in June 2001.  The agreement provides that Mr. Roodt will devote
substantially all of his business time, energies and abilities to our
business and will receive an annual salary of $150,000.  Mr. Roodt also
received a one time option to purchase 150,000 shares of our common stock at
an exercise price of $2.00 per share.  The option to purchase 150,000 shares
of our common stock is exercisable after the fifth anniversary following the
grant date.  However, the vesting of such option will be accelerated as
follows:

            o the option will be  exercisable  with respect to 30,000  shares on
such earlier date that we realize earnings per share of $.75 or more on a fiscal
year basis;

            o the option  will be  exercisable  with  respect  to an  additional
50,000  shares on such earlier date that we realize  earnings per share of $1.00
or more on a fiscal year basis; and

            o the option  will be  exercisable  with  respect  to an  additional
70,000  shares on such earlier date that we realize  earnings per share of $1.50
or more on a fiscal year basis.

The  option  has  vested  with  respect  to  80,000  shares  as a result  of our
realization of the applicable earnings per share requirements. We intend, during
the  term of Mr.  Roodt's  employment  agreement,  to pay Mr.  Roodt  an  annual
incentive bonus of four percent of the Minimum Pretax Income,  as defined in Mr.
Roodt's employment  agreement,  above $5,000,000,  as is reported in our audited
financial  statements  for each  fiscal

                                      -20-
<PAGE>

year in which Mr. Roodt is employed, exclusive of certain extraordinary earnings
or charges. In November 1998, Mr. Roodt entered into a non-competition agreement
with First South African Holdings (Pty.) Ltd. In exchange for his agreement, Mr.
Roodt received 2,000,000 shares of First Lifestyle Holdings.

      Mr. Roodt's employment contract with First South African Holdings
(Pty.) Ltd. terminated on December 31, 1999 when he became Chief Executive
Officer of First Lifestyle Holdings, Ltd.


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 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.

      We have  granted  options to purchase  630,000  shares of our common stock
under our 1995 Stock Option Plan, 110,000 of which have been exercised.



                                      -21-
<PAGE>

Non-Plan Stock Options

      We have granted non-plan stock options to purchase 1,100,000 shares of our
common  stock,  500,000 of which were granted at an exercise  price of $4.75 per
share and 600,000 of which were granted at $4.06 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.

Item 12.   Security Ownership of Certain Beneficial Owners and Management

      The  following  table  sets  forth,  as of  September  28,  2000,  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.


                                      -22-
<PAGE>
                              Amount and Nature of
                              --------------------
                              Beneficial Ownership (1)
                              ------------------------
                                                       Percentage  Percentage
                                                       ----------  ----------
                                        Class B            of      of Voting
                                        -------            --      ---------
       Name and Address of     Common    Common         Ownership    Power
       -------------------     ------    ------         ---------    -----
       Beneficial Shareholder  Stock     Stock (2)       (1)(3)     (1)(3)
       ----------------------  -----     ---------       ------     ------

       Michael Levy        63,333(4)  736,589(5)          8.58%      28.98%
       9511 West River
       Street
       Shiller Park, IL
       60176

       Clive Kabatznik     519,999(6)  190,000            7.26%      10.98%
       6100 Glades Road
       Suite 305
       Boca Raton, FL
       33434

       Cornelius J. Roodt  188,333(7)     0                2.0%       1.4%
       P.O. Box 4001
       Kempton Park
       South Africa

       BT Global Credit    1,263,157(8)   0               12.00%     8.94%
       Limited c/o
       Bankers Trust
       Luxembourg S.A.
       P.O. Box 807
       14 Boulevard F.D.
       Roosevelt
       L-2540 Luxembourg
       Luxembourg          354,334(9) 166,452(9)          5.62%      9.22%

       American Stock
       Transfer & Trust Company
       6201 15th Avenue
       Brooklyn, New York
       11219

                                      -23-
<PAGE>
                              Amount and Nature of
                              --------------------
                              Beneficial Ownership (1)
                              ------------------------
                                                       Percentage  Percentage
                                                       ----------  ----------
                                        Class B            of      of Voting
                                        -------            --      ---------
       Name and Address of     Common    Common         Ownership    Power
       -------------------     ------    ------         ---------    -----
       Beneficial Shareholder  Stock     Stock (2)       (1)(3)     (1)(3)
       ----------------------  -----     ---------       ------     ------

       UBS AG               1,379,310      0               14.89%     10.72%
       c/o Warburg Dillon
       Read
       677 Washington
       Boulevard
       Stamford,
       Connecticut 06901

       David BenDaniel      10,000(10)     0                 *          *
       6100 Glades Road
       Suite 305
       Boca Raton,
       Florida 33434

       Chris Matty          10,000(10)     0                 *          *
       6100 Glades Road
       Suite 305
       Boca Raton,
       Florida 33434

       All executive       791,665(11) 926,589            17.13%     39.74%
       officers and
       directors as a
       group (5 persons)
       *  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 March 13,
      2000.

(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 below.

(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  63,333  shares of our common  stock  issuable  upon  exercise of
      options that are immediately exercisable.

(5)   Includes  (i) 570,137  shares of our Class B common stock and (ii) 166,452
      shares of our Class B common stock issued to the American Stock Transfer &
      Trust Company pursuant to the terms of an escrow  agreement,  which shares
      correspond  to a like  number of shares of First  South  African  Holdings
      (Pty.) Ltd.  Class B stock.  American  Stock  Transfer & Trust Company has
      granted  to Mr.  Levy a proxy to vote  each of such  shares of our Class B
      common stock.

(6)   Includes  519,999  shares of our common stock  issuable  upon  exercise of
      options that are immediately exercisable.

(7)   Includes  188,333  shares of our common stock  issuable  upon  exercise of
      options that are immediately exercisable.

(8)   Includes  1,263,157 shares of our common stock issuable upon conversion of
      certain Increasing Rate Senior Subordinated Convertible Debentures

(9)   Based solely upon information  contained in a Schedule 13G,  Amendment No.
      1, dated 12/31/99 filed with the Securities and Exchange  Commission.  All
      shares are held as escrow  agent  pursuant to various  escrow  agreements.
      American  Stock  Transfer & Trust Company holds a proxy to vote the shares
      of common stock.  Michael Levy holds a proxy to vote the shares of Class B
      Common Stock.

(10)  Includes  10,000  shares of our common stock  issuable upon the exercise
      of options that are immediately exercisable

(11)  Represents  791,665  shares  issuable  upon  exercise of options  that are
      immediately exercisable.

                                      -24-
<PAGE>

Item 13.   Certain Relationships and Related Transactions

Not applicable.


Part IV

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

      1.  Financial Statements

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

Leisureplanet Holdings, Ltd.

      Report of the independent auditors Consolidated Balance Sheets at June 30,
      2000 and 1999  Consolidated  Statements of Income for the years ended June
      30,  2000,  1999 and 1998  Consolidated  Statements  of Cash Flows for the
      years ended June 30, 2000, 1999 and 1998 Consolidated Statement of Changes
      in Stockholders'  Investment for the period June 30, 1998 to June 30, 2000
      Notes to the  Consolidated  Financial  Statements for the years ended June
      30, 2000, 1999 and 1998

      2.  Financial Statement Schedules:

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

      3.  Exhibits:

   (B)  Reports on Form 8-K

   Not applicable.

 Exhibit Number Description

         3.1      Memorandum of Association of the Registrant(7)
         3.2      Bye-Laws of the Registrant(7)
         4.1      Form of Warrant Agreement(7)
         4.2      Form of Unit Purchase Option(7)
         4.3      Indenture  dated April 25, 1997  between  the  Registrant  and
                  American Stock Transfer & Trust Company(1)
         4.4      Form of Debenture(8)
         4.5      Form of Placement Warrant(8)
         4.6      Stock Option Agreement(8)

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<PAGE>

         4.7      Indenture  dated October 29, 1997,  between the Registrant and
                  American Stock Transfer & Trust Company(3)
         4.8      Loan Note dated May 27, 1999 granted by  Leisureplanet.com  in
                  favor of Twin Media (Proprietary) Limited
         10.1     Form  of  Escrow   Agreement   regarding  the  Earnout  Escrow
                  Shares(7)
         10.2     Form of FSAH Escrow Agreement(7)
         10.3     Form of First  Amended and  Restated  Employment  Agreement of
                  Clive Kabatznik(7)
         10.4     Form of FSAM Management Agreement(7)
         10.5     Form of Consulting Agreement with Michael Levy(7)
         10.6     1995 Stock Option Plan(7)
         10.7     Pieman's Pantry Acquisition Agreement(4)
         10.8     Form of Astoria Acquisition Agreement(5)
         10.9     Form of Gull Foods Acquisition Agreement(6)
         10.10    Form of Employment Agreement of Cornelius Roodt(2)
         10.11    Agreement   dated   February  12,  1999  between  Twine  Media
                  (Proprietary)  Limited,  First South  Africa  Corp.,  Ltd. and
                  Leisureplanet.com
         10.12    Form of Employment Agreement of Pierre Kleinhans
         11.1     Statement re: computation of (loss) earnings per share
         21.1     Subsidiaries of the Registrant
         23.1     Consent of Independent Certified Public Accountants(9)
         27.1     Financial Data Schedule

-----------
(1)   Incorporated by reference is the Registrant's  Current Report on Form 8-K,
      Exhibit 4.1 (filed on September 10, 1997).
(2)   Incorporated by reference is the  Registrant's  Annual Report on Form 10-K
      for the fiscal year ended June 30, 1997 (filed on September 29, 1997).
(3)   Incorporated by reference is the Registrant's  Current Report on Form 8-K,
      Exhibit 4.1 (filed on October 31, 1997).
(4)   Incorporated by reference is the Registrant's  Current Report on Form 8-K,
      Exhibit 1 (filed on June 14,  1996) as  amended  on Form  8-K/A  (filed on
      August 16, 1996) and as amended on Form 8-K/A (filed on January 22, 1998).
(5)   Incorporated by reference is the Registrant's  Current Report on Form 8-K,
      Exhibit 1 (filed on November  7, 1996) as amended on Form 8-K/A  (filed on
      March 14, 1997).
(6)   Incorporated by reference is the Registrant's  Current Report on Form 8-K,
      Exhibit 1 (filed on May 8, 1997) as  amended on Form 8-K/A  (filed on July
      3, 1997).
(7)   Incorporated by reference is 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.
(8)   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).
(9)   Filed herewith.

      (b)  Reports on Form 8-K

      Not applicable.

                                      -26-
<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.

                                    LEISUREPLANET HOLDINGS, LTD.


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

April 18, 2001


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