UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   FORM 10-K/A

(Mark One)

[X]             ANNUAL REPORT PURSUANT TO SECTION 13 OR 5(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended  December 31, 2004
                           ----------------------------------------------------

                                       OR

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

                        Commission File Number 000-08187

                       CabelTel International Corporation
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

             Nevada                                          75-2399477
-------------------------------                     ----------------------------
(State or other jurisdiction of                     (IRS Employer Identification
 Incorporation or organization)                                Number)

1755 Wittington Place, Suite 340, Dallas, Texas                   75234
-----------------------------------------------         ------------------------
    (Address of prinicpal executive offices)                   (Zip Code)

Registrant's Telephone Number, including area code           972-407-8400
                                                    ----------------------------

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

     Title of Each Class               Name of each exchange on which registered
Common Stock, $0.01 par value                    American Stock Exchange
-----------------------------          -----------------------------------------

Securities registered pursuant to Section 12(g) of the Act:   None

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

     Indicate by check mark if disclosure of delinquent  filers pursuant to Item
405 of Regulation S-K (ss.229.405 of this chapter) 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 this Form 10-K. [ X ]

     Indicate by check mark whether the registrant is an  accelerated  filer (as
defined in Rule 12b-2 of the Act).

                             Yes [   ]  No [ X ]

     The aggregate  market value of the voting stock held by  non-affiliates  of
the issuer,  computed by reference to the closing sales price on March 31, 2005,
was  approximately  $2,424,000.  At March 31, 2005,  the issuer had  outstanding
approximately 977,000 shares of par value $0.01 Common Stock.


                       DOCUMENTS INCORPORATED BY REFERENCE
                                      None

<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Shareholders

Cabeltel International Corporation, formerly Greenbriar Corporation

We have  audited  the  accompanying  consolidated  balance  sheets  of  Cabeltel
International  Corporation,  formerly Greenbriar Corporation and subsidiaries as
of  December  31,  2004 and 2003,  and the related  consolidated  statements  of
income,  shareholders'  equity  and  cash  flows  for  each of the  years in the
three-year  period  ended  December  31,  2004.  These  consolidated   financial
statements   are  the   responsibility   of  the   company's   management.   Our
responsibility  is  to  express  an  opinion  on  these  consolidated  financial
statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and  perform  the  audit  to  obtain  reasonable  assurance  about  whether  the
consolidated financial statements are free of material misstatement. The company
is not  required  to  have,  nor were we  engaged  to  perform,  an audit of its
internal control over financial reporting.  Our audits include  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion of the  effectiveness  of the company's  internal  control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the  consolidated  financial  statements.  An audit also includes
assessing the  accounting  principles  used and  significant  estimates  made by
management,  as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated  financial statements referred to above present
fairly,  in  all  material   respects,   the  financial   position  of  Cabeltel
International  Corporation,  formerly Greenbriar Corporation and subsidiaries as
of December 31, 2004 and 2003, and the consolidated  results of their operations
and  their  cash  flows  for each of the years in the  three-year  period  ended
December 31, 2004 in conformity with accounting principles generally accepted in
the United States of America.

/s/ FARMER FUQUA & HUFF, P.C.

Plano, TexasApril 15, 2005

<PAGE>
<TABLE>
<CAPTION>
               CabelTel International Corporation and Subsidiaries

                           CONSOLIDATED BALANCE SHEETS
                             (Amounts in thousands)

                                  December 31,



                   ASSETS                                          2004        2003
                                                                 --------    --------
<S>                                                              <C>         <C>
CURRENT ASSETS
    Cash and cash equivalents                                    $  1,352    $  1,427
    Accounts receivable - trade                                     1,016         443
    Notes receivable                                                  856
    Inventory                                                       1,166         235
    Assets held for sale                                            3,939
    Other current assets, net                                         710       1,573
                                                                 --------    --------

               Total current assets                                 9,039       3,678



PROPERTY AND EQUIPMENT, AT COST
    Land and improvements                                           2,114
    Buildings and improvements                                      9,982         544
    Equipment and furnishings                                      12,246       7,378
    Assets under construction                                      11,571       3,833
    Proven oil and gas properties (full cost method)                1,357
                                                                 --------    --------
                                                                   37,270      11,755

    Less accumulated depreciation, depletion, and amortization     (5,172)     (3,454)
                                                                 --------    --------
                                                                   32,098       8,301

Goodwill                                                            8,339       2,905

OTHER ASSETS                                                        1,037          80
                                                                 --------    --------

Total Assets                                                     $ 50,513    $ 14,964
                                                                 ========    ========

                                      F-2

<PAGE>

               CabelTel International Corporation and Subsidiaries

                     CONSOLIDATED BALANCE SHEETS - CONTINUED
                  (Amounts in thousands, except share amounts)

                                  December 31,



    LIABILITIES AND STOCKHOLDERS' EQUITY                           2004        2003
                                                                 --------    --------

CURRENT LIABILITIES
    Current maturities of long-term debt                         $  9,603    $  2,553
    Current notes payable                                             352
    Accounts payable - trade                                        3,887         964
    Accrued expenses                                                9,498         134
    Other current liabilities                                       1,792       2,211
                                                                 --------    --------

               Total current liabilities                           24,780       6,214

LONG-TERM DEBT
      Long -tem debt                                                9,740
      Long-term debt - related parties                             10,523       2,120
                                                                 --------    --------
                                                                   20,263       2,120
                                                                 --------    --------


OTHER LONG-TERM LIABILITIES                                         1,557          68
                                                                 --------    --------

               Total liabilities                                   46,600       8,402

Minority Interest                                                   2,954         827

STOCKHOLDERS' EQUITY
    Preferred stock, Series B                                           1           1
    Preferred stock, Series J                                       3,150        --
    Common stock, $.01 par value; authorized, 4,000,000
       shares; issued and outstanding, 977,000 shares issued
       and outstanding                                                 10          10
    Additional paid-in capital                                          4       5,575
    Accumulated other comprehensive income (loss)                   1,014       1,204
    Retained earnings                                              (3,220)     (1,055)
                                                                 --------    --------

                                                                      959       5,735
                                                                 --------    --------


Total liabilities & equity                                         50,513      14,964
                                                                 ========    ========
</TABLE>


        The accompanying notes are an integral part of these statements.

                                       F-3


<PAGE>
<TABLE>
<CAPTION>

               CabelTel International Corporation and Subsidiaries

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                  (Amounts in thousands, except share amounts)



                                                             Year ended December 31,
                                                          2004        2003        2002
                                                        --------    --------    --------
<S>                                                     <C>         <C>         <C>
Revenue
    Cable operations                                    $  9,463    $  8,338    $  6,262
    Real estate operations                                 1,173
    Oil and gas operations                                   413        --          --
                                                        --------    --------    --------
                                                          11,049       8,338       6,262
                                                        --------    --------    --------

Operating expenses
    Cable operation                                        6,226       5,731       3,286
    Real estate operations                                   722        --          --
    Oil and gas operations                                   237        --          --
    Lease expense 1,178                                      560         613        --
    Depreciation, depletion, and amortization              1,612       1,439         913
    Corporate general and administrative                   4,166       1,056         921
                                                        --------    --------    --------
                                                          14,141       8,786       5,733
                                                        --------    --------    --------

                  Operating earnings (loss)               (3,092)       (448)        529

Other income (expense)
    Interest income                                           44           6           5
    Interest expense                                        (926)       (202)        (45)
    Gain on foreign transactions, net                        241         413         338
    Gain on sale of assets, net                              844         368        --
    Other income (expense), net                              325         389           1
                                                        --------    --------    --------
                                                             528         974         299
                                                        --------    --------    --------

Earnings (loss) before income taxes
    and minority interest                                 (2,564)        526         828

Income tax (income) expense                                   32         (66)        122

Minority interest                                           (431)        137         109
                                                        --------    --------    --------

       Net earnings (loss) from continuing operations     (2,165)        455         597
                                                        --------    --------    --------

Discontinued operations                                     --          --          (508)

Net income (loss)                                       $ (2,165)   $    455    $     89
Preferred dividend requirement                              (158)       --          --
                                                        --------    --------    --------

Net income applicable to Common shares                  $ (2,323)   $    455    $     89
                                                        --------    --------    --------

Earnings per share - basic
    Net income (loss) from continuing operations        $  (2.38)   $   0.47    $   0.61
    Discontinued operations                                 --          --          (.52)
                                                        --------    --------    --------
                  Net earnings (loss) per share         $  (2.38)   $   0.47    $   0.09

Basic weighted average common shares                         977         977         977



       The accompanying notes are an integral part of these statements.

                                       F-4


<PAGE>

CONSOLIDATED OF OPERATIONS - CONTINUED

Earnings per share - diluted
    Net income (loss) from continuing operations        $  (2.38)   $   0.43    $   0.60
    Discontinued operations                                 --                      (.51)
                                                        --------    --------    --------
                  Net earnings (loss) per share         $  (2.38)   $   0.43    $   0.09

Diluted weighted average common shares                       977       1,057         997


In accordance  with the provisions of the  acquisition  agreement the Company is
required to have a shareholder  vote  permitting  the Series J  shareholders  to
convert into 8,788,000  shares of the Company's  common stock. The following pro
forma earnings per share assumes such conversion has occurred.


Pro-forma earnings per share - diluted
    Net income(loss) from continuing operations         $   (.24)   $   0.05    $   0.06
    Discontinued operations                                 --                      (.05)
                                                        --------    --------    --------
                  Net earnings (loss) per share         $   (.24)   $   0.05    $   0.01

Diluted weighted average common shares                     9,766       9,846       9,786
</TABLE>


















         The accompanying notes are an integral part of this statement.

                                      F-5
<PAGE>
<TABLE>
<CAPTION>

               CabelTel International Corporation and Subsidiaries

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (Amounts in thousands)


                                                               Year ended December 31,
                                                          --------------------------------
                                                            2004        2003        2002
                                                          --------    --------    --------
<S>                                                       <C>         <C>         <C>
Cash flows from operating activities
    Net earnings (loss)                                   $ (2,165)   $    455    $     89
    Adjustments to reconcile net earnings (loss) to net
       cash provided by (used in) operating activities
          Depreciation and amortization                      1,612       1,439         913
          Gain on foreign currency transactions               (241)       (413)       (338)
          Gain on sale of assets                              (844)       (368)
          Increase in minority interest                       (650)        216         162
          Changes in operating assets and liabilities
                Accounts receivable - trade                   (351)        (61)        (53)
                Other current and noncurrent assets           (162)     (1,543)         87
                Accounts payable and other liabilities       3,171         840       1,216
                                                          --------    --------    --------

                  Net cash provided by (used in)
                    operating activities                       370         565       2,076

Cash flows from investing activities
    Purchase of property and equipment                      (4,165)     (3,461)     (2,274)
                                                          --------    --------    --------

                   Net cash provided by (used in)
                      investing activities                  (4,165)     (3,461)     (2,274)

Cash flows from financing activities
    Proceeds from borrowings                                 4,072       5,602         454
    Payments on debt                                          (352)     (1,702)       (218)
                                                          --------    --------    --------

                Net cash provided by (used in)
                   financing activities                      3,720       3,900         236
                                                          --------    --------    --------

                Net increase (decrease) in cash
                   and cash equivalents                        (75)      1,004          38
Cash and cash equivalents at beginning of year               1,427         423         385
                                                          --------    --------    --------

Cash and cash equivalents at end of year                  $  1,352    $  1,427    $    423
                                                          ========    ========    ========
</TABLE>




         The accompanying notes are an integral part of this statement.

                                       F-6

<PAGE>
<TABLE>
<CAPTION>

            CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY
                             (Amounts in thousands)


                                               Series B                        Series J
                                           Preferred stock                 Preferred stock                   Common stock
                                   -----------------------------   -----------------------------   ------------------------------
                                       Shares          Amount          Shares          Amount          Shares           Amount
                                   -------------   -------------   -------------   -------------   --------------   -------------
<S>                                <C>             <C>             <C>             <C>              <C>             <C>
Balance at January 1, 2002                     1               1            --              --                977              10

Comprehensive income:                       --              --              --              --               --              --
     Unrealized gain on foreign
           currency translation             --              --              --              --               --              --
     Net earnings                           --              --              --              --               --              --
                                   -------------   -------------   -------------   -------------   --------------   -------------

 Balance at December 31, 2002                  1               1            --              --                977              10

Comprehensive income:                       --              --              --              --               --              --
     Unrealized gain on foreign
           currency translation             --              --              --              --               --              --
     Net earnings                           --              --              --              --               --              --
                                   -------------   -------------   -------------   -------------   --------------   -------------

 Balance at December 31, 2003                  1               1            --              --                977              10
     Net loss

Issuance of preferred stock for
     Reverse acquisition of
     Greenbriar Corporation and
     recapitalization related to
     reverse acquisition on
     October 1, 2004                        --              --                32           3,150             --              --

Comprehensive income:                       --              --              --              --               --              --
     Unrealized gain on foreign
           currency translation             --              --              --              --               --              --
     Net earnings                           --              --              --              --               --              --
                                   -------------   -------------   -------------   -------------   --------------   -------------
Balance at December 31, 2004                   1               1              32           3,150              977              10
                                   =============   =============   =============   =============   ==============   =============

                                                                    Accumulated
                                     Additional                        Other
                                      paid in       Accumulated    Comprehensive
                                      capital         deficit      Income (Loss)      Total
                                   -------------   -------------   -------------   -------------
Balance at January 1, 2002                 5,575          (1,599)          3,987

Comprehensive income:                       --              --              --              --
     Unrealized gain on foreign
           currency translation             --              --               407             407
     Net earnings                           --                89            --                89
                                   -------------   -------------   -------------   -------------

 Balance at December 31, 2002              5,575          (1,510)            407           4,483

Comprehensive income:                       --              --              --              --
     Unrealized gain on foreign
           currency translation             --              --               797             797
     Net earnings                           --               455            --               455
                                   -------------   -------------   -------------   -------------

 Balance at December 31, 2003              5,575          (1,055)          1,204           5,735
     Net loss

Issuance of preferred stock for
     Reverse acquisition of
     Greenbriar Corporation and
     recapitalization related to
     reverse acquisition on
     October 1, 2004                      (5,571)           --              --            (2,421)

Comprehensive income:                       --              --              --              --
     Unrealized gain on foreign
           currency translation             --              --              (190)           (190)
     Net earnings                           --            (2,165)           --            (2,165)
                                   -------------   -------------   -------------   -------------
Balance at December 31, 2004                   4          (3,220)          1,014             959
                                   =============   =============   =============   =============
</TABLE>


                                       F-7
<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




NOTE A - BUSINESS DESCRIPTION AND PRESENTATION

    Name Change
    -----------

    On February  10, 2005  Greenbriar  Corporation  changed its name to CabelTel
    International  Corporation  (which is  referred  throughout  this  report as
    "CIC").


    Acquisition of CableTEL AD
    --------------------------

    On October 12, 2004 the CIC acquired two privately-held  U.S.,  Corporations
    in  exchange  for 31,500  shares of  newly-designated  2% Series J Preferred
    Stock.  The two U.S.  corporations  collectively  own 100% of Tacaruna BV, a
    Netherlands  company,  which in turn owns 74.8% of CableTEL  AD, a Bulgarian
    telecommunications company.

    The Series J Preferred  Stock is not  convertible to common stock,  however,
    the terms of the acquisition  agreement require CIC to present a proposal to
    its stockholders to approve the exchange of all shares of Series J Preferred
    Stock  into  8,788,500   shares  of  common  stock  which,  if  approved  by
    stockholders, would represent 90% of the total issued and outstanding shares
    of common  stock in CIC.  Management  believes  that this  approval  will be
    forthcoming.  This would effectively give the owners of the legally acquired
    company (CableTEL AD) the controlling interest in CIC. Although CIC acquired
    the two U.S.  entities,  due to the effective change in control by virtue of
    the issuance of the aforementioned consideration,  this transaction is being
    accounted  for as a  "reverse  acquisition",  with  CableTEL  AD  being  the
    surviving company. As a reverse  acquisition for reporting purposes,  CIC is
    accounted for as if it had been acquired.  Also, certain information and the
    historical  financial  statements  presented  present  those of the entities
    acquired by CIC for all years presented.

    For  purpose  of  determining  the  value of the  consideration,  management
    believed  that  due to one of the  owners  of  CableTEL  AD also  having  an
    ownership  interest in CIC,  the  transaction  should not result in goodwill
    being  recognized.  Management  valued the assets of CIC at their fair value
    and applied that value to the acquisition transaction.

    The following table sets forth the allocation of the purchase price to CIC's
    assets and liabilities acquired effective as of October 1, 2004:




                                      F-8

<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE A - BUSINESS DESCRIPTION AND PRESENTATION - Continued

Cash                                                               $    283,000
Accounts receivable                                                     276,000
Notes receivable                                                        871,000
Property held for sale                                                1,725,000
Property and equipment                                               13,038,000
Other assets                                                            891,000
Accounts payable and accrued expenses                                (1,024,000)
Other liabilities                                                      (216,000)
Notes payable                                                       (12,344,000)
                                                                   ------------
   Total                                                           $  3,500,000
                                                                   ============


    Nature of Operations
    --------------------

    CabelTel  International  Corporation,  its  subsidiaries and affiliates (the
    "Company") is principally a telecommunications  company which provides cable
    television,  telephone,  internet  access  and  fiber  optic  line  capacity
    services in the country of Bulgaria.

    As of December 31, 2004 the Company had nearly  130,000 cable TV subscribers
    and access to another 400,000 households in Bulgaria.  It had also completed
    the first  alternative  fiber optical backbone in Bulgaria with connectivity
    to Turkey, Greece, Romania and Macedonia.

    In addition the Company owns retirement communities,  oil and gas leases and
    a shopping mall in the United States.




NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


    A summary of the significant  accounting policies applied in the preparation
    of the accompanying consolidated financial statements follows:

    Principles of Consolidation
    ---------------------------

    The  consolidated  financial  statements  include  the  accounts of CabelTel
    International  Corporation  and  its  majority-owned  subsidiaries  and  are
    prepared on the basis of  accounting  principles  generally  accepted in the
    United States of America.  All  significant  intercompany  transactions  and
    accounts have been eliminated.



                                      F-9
<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

    Depreciation
    ------------

    Depreciation  is provided  for in amounts  sufficient  to relate the cost of
    property and equipment to operations  over their  estimated  service  lives,
    ranging from 3 to 40 years.  Depreciation  is computed by the  straight-line
    method.

    Accounting for Leases
    ---------------------

    Leases  of  property,   plant  and  equipment   where  the  Company  assumes
    substantially  all the  benefits and risks of ownership  are  classified  as
    finance  leases.  Finance leases are  capitalised  at the estimated  present
    value of the  underlying  lease  payments.  Each lease  payment is allocated
    between the liability  and finance  charges so as to achieve a constant rate
    on the finance balance  outstanding.  The corresponding  rental obligations,
    net of finance  charges,  are  included  in other  long-term  payables.  The
    interest  element of the finance  charge is charged to the income  statement
    over the lease period.  The property,  plant and  equipment  acquired  under
    finance leasing  contracts is depreciated over the useful life of the asset.
    Leases of assets  under which all the risks and  benefits of  ownership  are
    effectively  retained  by the lessor are  classified  as  operating  leases.
    Payments made under operating  leases are charged to the income statement on
    a straight-line  basis over the period of the lease. When an operating lease
    is terminated  before the lease period has expired,  any payment required to
    be made to the lessor by way of penalty is  recognised  as an expense in the
    period in which termination takes place.

    Inventories
    -----------

    Inventories are stated at the lower of cost or net realisable value. Cost is
    determined  weighted average method. Net realisable value is the estimate of
    the  selling  price in the  ordinary  course of  business,  less the cost of
    completion and selling expenses.

    Use of Estimates
    ----------------

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


    Cash Equivalents
    ----------------

    The Company considers all short-term  deposits and money market  investments
    with a maturity of less than three months to be cash equivalents.




                                      F-10

<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

    Foreign Currencies
    ------------------

    Foreign  currency  transactions  by the  Company  are  accounted  for at the
    exchange rates prevailing at the date of the transactions;  gains and losses
    resulting from the settlement of such  transactions and from the translation
    of monetary  assets and  liabilities  denominated in foreign  currencies are
    recognized in the income statement. Such balances are translated at year-end
    exchange rates unless hedged by forward foreign exchange contracts, in which
    case the rates specified in such forward  contracts are used. The effects of
    translation  are  recorded  in  the  cumulative   translation  component  of
    shareholder's equity.

    Goodwill
    --------

    Goodwill  represents the excess of the cost of an acquisition  over the fair
    value of the Company's share of the net assets of the acquired subsidiary or
    associated  undertaking  at the date of  acquisition.  Until January 1, 2002
    goodwill was  amortized  using the  straight-line  method over its estimated
    useful life. The Company has adopted FASB 142 Business Combinations from the
    date it was issued and after  initial  recognition  goodwill  is measured at
    cost  less any  accumulated  impairment  losses.  The value of  goodwill  is
    reviewed  annually and written  down for  permanent  impairment  where it is
    considered necessary.

    Other Intangible Assets
    -----------------------

    The cost of acquired  patents,  trademarks and licenses is  capitalized  and
    amortized  using the  straight-line  method  over their  useful  lives.  The
    carrying amount of each intangible  asset is reviewed  annually and adjusted
    for permanent impairment where it is considered necessary.

    Impairment of Notes Receivable
    ------------------------------

    Notes  receivable  are  identified  as  impaired  when it is  probable  that
    interest and principal  will not be collected  according to the  contractual
    terms of the note  agreements.  The accrual of interest is  discontinued  on
    such  notes,  and no income is  recognized  until  all past due  amounts  of
    principal  and  interest are  recovered in full.  No notes were deemed to be
    impaired at December 31, 2004 and 2003.

    Impairment of Long-Lived Assets
    -------------------------------

    The  Company  reviews  its  long-lived   assets  and  certain   identifiable
    intangibles for impairment when events or changes in circumstances  indicate
    that the carrying amount of the assets may not be recoverable.  In reviewing
    recoverability,  the Company  estimates  the future  cash flows  expected to
    result from use of the assets and  eventually  disposing of them. If the sum
    of the  expected  future  cash  flows  (undiscounted  and  without  interest
    charges) is less than the carrying  amount of the asset,  an impairment loss
    is recognized based on the asset's fair value.

    The  Company  determines  the fair  value of  assets to be  disposed  of and
    records the asset at the lower of fair value less disposal costs or carrying
    value. Assets are not depreciated while held for disposal.



                                      F-11
<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

    Stock Options
    -------------

    The Company has elected to follow  Accounting  Principles  Board Opinion No.
    25,  Accounting  for  Stock  Issued  to  Employees  (APB 25) in its  primary
    financial statements and has provided  supplemental  disclosures required by
    Statement of Financial Accounting Standards No. 123 (SFAS 123),  "Accounting
    for  Stock-Based  Compensation"  and by Statement  of  Financial  Accounting
    Standards No. 148, "Accounting for Stock-Based Compensation - Transition and
    Disclosure an Amendment of SFAS No. 123."

    Options were granted at market by Cabeltel International  Corporation during
    2003, are exercisable immediately, and expire 5 years from date of grant.

    Warrants were issued at market by Cabeltel International  Corporation during
    2004,  are  exercisable  contingent  upon  the  conversion  of the  Series J
    Preferred stock,to common stock.  Because of the contingent nature as to the
    timing  and the  ability  to  exercise  these  warrants,  no value  has been
    ascribed to such warrants at December 31, 2004.

    SFAS 123 requires  disclosure of pro forma net earnings (loss) and pro forma
    net  earnings  (loss) per share as if the fair value method had been applied
    in measuring compensation cost for stock-based awards.


    Reported and pro forma net earnings (loss) and net earnings (loss) per share
    amounts are set forth below (in thousands, except per share data):

                                                                   2003
                                                                  ------
           Net earnings (loss) allocable to common stockholders
                As reported                                       $  455
                Deduct:  total stock-based compensation under
                      fair value based method for all awards         (43)

                Pro forma                                         $  422

           Net earnings (loss) per share
                As reported                                       $ 0.43
                Pro forma                                         $ 0.40



    The fair value of these  options was  estimated  at the date of grant during
    2003  using  the  Black-Scholes  option  pricing  model  with the  following
    weighted-average  assumptions:  no  dividends;  expected  volatility  of  20
    percent;  risk-free  interest  rates of 4.24 percent;  and weighted  average
    expected lives of 5 years.



                                      F-12

<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

    Earnings (Loss) Per Common Share
    --------------------------------

    Basic  earnings  (loss) per common  share is based on the  weighted  average
    number of common shares  outstanding.  Diluted  earnings (loss) per share is
    computed based on the weighted  average number of common shares  outstanding
    plus the number of additional common shares that would have been outstanding
    if dilutive  potential common shares had been issued. In 2004, stock options
    for   approximately   140,000  shares  were  excluded  from  diluted  shares
    outstanding  because  their effect was  anti-dilutive.  In 2004 warrants for
    approximately  190,000 shares were excluded from diluted shares  outstanding
    because their effect was anti-dilutive.

    Sales of Real Estate
    --------------------

    Gains on sales of real estate are recognized to the extent permitted by SFAS
    No. 66,  "Accounting  for Sales of Real Estate." Until the  requirements  of
    SFAS No. 66 have been met for full profit  recognition,  sales are accounted
    for by the installment or cost recovery method, whichever is appropriate.

    Real estate held for sale
    -------------------------

    SFAS No. 144 requires that properties held for sale be reported at the lower
    of carrying  amount or fair value less costs of sale.  If a  reduction  in a
    held for sale property's carrying amount to fair value less costs of sale is
    required,  a provision for loss is recognized by a charge against  earnings.
    Subsequent  revisions,  either  upward  or  downward,  to a  held  for  sale
    property's  estimated  fair  value  less  costs of sale are  recorded  as an
    adjustment  to the  property's  carrying  amount,  but not in  excess of the
    property's  carrying amount when  originally  classified as held for sale. A
    corresponding charge against or credit to earnings is recognized. Properties
    held for sale are not depreciated.

    New Accounting Pronouncements
    -----------------------------

    SFAS No. 151--In  November 2004, the Financial  Accounting  Standards  Board
    issued  Statement  of Financial  Accounting  Standards  No. 151,  "Inventory
    Costs, an Amendment of ARB No. 43, Chapter 4" ("SFAS No.151").  SFAS No. 151
    amends ARB 43, Chapter 4, to clarify that abnormal  amounts of idle facility
    expense,   freight,  handling  costs  and  wasted  materials  (spoilage)  be
    recognized as current period  charges.  It also requires that  allocation of
    fixed production overheads to the costs of conversion be based on the normal
    capacity  of the  production  facilities.  SFAS  No.  151 is  effective  for
    inventory  costs incurred during fiscal years beginning after June 15, 2005.
    The  adoption of SFAS No. 151 is not  expected to have a material  impact on
    the consolidated financial position or results of operations of CIC.



                                      F-13

<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Continued

    SFAS No. 152--In  December 2004, the Financial  Accounting  Standards  Board
    issued Statement of Financial  Accounting Standards No. 152, "Accounting for
    Real Estate Time-Sharing Transactions" ("SFAS No. 152"). SFAS No. 152 amends
    FASB Statement No. 66, Accounting for Sales of Real Estate, to reference the
    financial  accounting  and reporting  guidance for real estate  time-sharing
    transactions   that  is  provided  in  AICPA  Statement  of  Position  04-2,
    Accounting  for Real  Estate  Time-SharingTransactions  ("SOP  04-2").  This
    Statement  also  amends  FASB  Statement  No. 67,  Accounting  for Costs and
    Initial  Rental  Operations  of Real  Estate  Projects,  to  state  that the
    guidance for (a)  incidental  operations and (b) costs incurred to sell real
    estate projects does not apply to real estate time-sharing transactions. The
    accounting for those  operations and costs is subject to the guidance in SOP
    04-2.

    SFAS  No.  152 is  effective  for  financial  statements  for  fiscal  years
    beginning after June 15, 2005, and is to be reported as a cumulative  effect
    of a change in  accounting  principle.  The  adoption of SFAS No. 152 is not
    expected to have a material impact on the consolidated financial position or
    results of operations of CIC.

    SFAS No. 123--In  December 2004, the Financial  Accounting  Standards  Board
    issued  Statement of Financial  Accounting  Standards  No. 123,  Share-Based
    Payment,  revised ("SFAS No. 123R").  SFAS No. 123R addresses the accounting
    for share-based  payments to employees,  including  grants of employee stock
    options. Under the new standard, companies will no longer be able to account
    for  share-based  compensation  transactions  using the intrinsic  method in
    accordance  with  APB  Opinion  No.  25,  Accounting  for  Stock  Issued  to
    Employees.   Instead,  companies  will  be  required  to  account  for  such
    transactions  using a  fair-value  method and  recognize  the expense in the
    consolidated  statement  of  income.  SFAS No.  123R will be  effective  for
    periods  beginning  after June 15,  2005 and allows,  but does not  require,
    companies  to restate  the full fiscal year of 2005 to reflect the impact of
    expensing  share-based payments under SFAS No. 123R. The Company has not yet
    determined  which  fair-value  method  and  transitional  provision  it will
    follow.  The  adoption of SFAS No.  123R is not  expected to have a material
    impact on the  Company's  consolidated  financial  position  or  results  of
    operations.  See Stock-Based Employee  Compensation for the pro forma impact
    on net  income  and  net  income  per  share  from  calculating  stock-based
    compensation costs under the fair value alternative of SFAS No. 123.

    SFAS No. 153--In  December 2004, the Financial  Accounting  Standards  Board
    issued  Statement of Financial  Accounting  Standards No. 153,  Exchanges of
    Non-monetary  Assets,  An Amendment of APB Opinion No. 29 ("SFAS No.  153").
    The   guidance  in  APB  Opinion  No.  29,   Accounting   for   Non-monetary
    Transactions,  is based on the  principle  that  exchanges  of  non-monetary
    assets should be measured  based on the fair value of the assets  exchanged.
    The guidance in APB Opinion No. 29, however,  included certain exceptions to
    that  principle.  SFAS No. 153 amends APB  Opinion No. 29 to  eliminate  the
    exception  for  non-monetary  exchanges  of  similar  productive  assets and
    replaces it with a general  exception for exchanges of  non-monetary  assets
    that  do  not  have  commercial  substance.   A  non-monetary  exchange  has
    commercial  substance if the future cash flows of the entity are expected to
    change significantly as a result of the exchange.  SFAS No. 153 is effective
    for non-monetary  asset exchanges in fiscal periods beginning after June 15,
    2005. The adoption of SFAS No. 153 is not expected to have a material impact
    on the consolidated financial position or results of operations of CIC.





                                      F-14

<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE C - Liquidity

    At  December  31, 2004 the Company  had  current  assets of  $9,039,000  and
    current liabilities of $24,780,000. During the past eighteen months CableTEL
    AD has for the most  part  completed  the  first  fiber  optic  backbone  in
    Bulgaria with  connectivity to Turkey,  Greece,  Romania and Macedonia.  The
    total investment in the backbone will be approximately $30,000,000.  Most of
    the costs to construct  the backbone were incurred in 2004 and were financed
    both through debt and vendor financing.

    The backbone that CableTEL AD is constructing consists of three separate and
    independent  fiber  optic  ducts,  and  CableTEL  AD only  needs one for its
    operations. The other two ducts are being constructed to sell to independent
    third  parties.  CableTEL  AD has a contract  for the sale of one duct for a
    total price of approximately $13,000,000. CableTEL AD received approximately
    $1,800,000 in 2004,  $4,200,000 in the first quarter of 2005 and anticipates
    the  collection  of the  remaining  balance of  approximately  $7,000,000 in
    second and third quarters of 2005. CableTEL AD is actively pursuing the sale
    of the remaining duct.


NOTE D -  NOTES RECEIVABLE

    The Company holds two  tax-exempt  notes for a total of  $4,030,000  bearing
    interest at 9.5%. The notes mature on April 1, 2032, and August 1, 2031.

    The  repayment  of the notes is limited  to the cash flow of the  respective
    properties  either from  operations,  refinancing  or sale.  The Company has
    valued  the notes and  accrued  interest  at zero and will  record  any cash
    received in the form of interest or principal as income.


 NOTE E - FAIR VALUE OF FINANCIAL INSTRUMENTS

    The following  methods and assumptions  were used to estimate the fair value
    of each  class of  financial  instruments  for  which it is  practicable  to
    estimate values at December 31, 2004 and 2003:

    Cash and cash  equivalents  - The carrying  amount  approximates  fair value
    because of the short maturity of these instruments.

    Long-term debt - The fair value of the Company's long-term debt is estimated
    based on market rates for the same or similar issues.  The carrying value of
    long-term debt approximates its fair value.

    Notes  receivable - The fair value of the note  receivable from an affiliate
    partnership  is  estimated  to  approximate  fair  value  based on its short
    maturity. It is not practical to estimate the fair value of notes receivable
    from sale of  properties  because no quoted  market  exists and there are no
    comparable debt instruments to provide a basis for valuation.





                                      F-15

<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




NOTE F - NOTES PAYABLE

    LONG TERM DEBT

    Long-term debt is comprised of the following (in thousands):

                                                               December 31,
                                                            2004          2003

Notes payable to financial institutions maturing            14,112
through 2018; fixed and variable interest rates
ranging from 5.75% to 11% ; collateralized by real
property, fixtures, equipment and the assignment of
rents
Notes payable to individuals and companies maturing          5,232
through 2023; variable and fixed interest rates
ranging from 10% to 18%; collateralized by real
property, personal property, fixtures, equipment and
the assignment of rents
Notes payable to related parties bearing interest at        10,522         2,120
rates ranging From 15% to 18%
                                                            29,866         2,120
                                                          ----------------------

         Less current maturities                             9,603             0
                                                          ======================

                                                            20,263         2,120
                                                          ======================








                                      F-16
<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE F - NOTES PAYABLE - Continued

    Aggregate annual principal maturities of long-term debt at December 31, 2004
    are as follows (in thousands):

          2005                                                             9,603
          2006                                                            13,222
          2007                                                               415
          2008                                                               480
          2009                                                             5,536
          Thereafter                                                         610
                                                                         -------

                                                                         $29,866
                                                                         =======




NOTE G - OPERATING LEASES

    The Company leases an assisted  living  community  under an operating  lease
    whose basic term  expires  December  31, 2011 and has  operating  leases for
    equipment and office space.  The leases  generally  provide that the Company
    pay property taxes, insurance, and maintenance.

    Future minimum payments following December 31, 2004 are as follows (in
thousands):

          2004                                                           $ 1,881
          2005                                                             1,881
          2006                                                             1,897
          2007                                                             1,836
          2008                                                             1,853
          Thereafter                                                       2,717
                                                                         -------

                                                                         $12,065

    Lease  expense  in  2004,  2003  and  2002  was  $1,178,   $560,  and  $613,
    respectively.





                                      F-17
<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE H  - EARNINGS PER SHARE

    The  following  table sets  forth the  computations  of pro forma  basic and
    diluted earnings per share (in thousands, except per share data):

                                                     Year ended December 31,
                                                   2004        2003       2002
Numerator:
  Net income(loss) from continuing operations    $ (2,165)   $    455   $     89

Denominator:
  Shares used in basic earnings per share
    calculation1                                      977         977        977

  Effect of diluted securities:
    Employee stock options                             80          20       --
    Warrants                                         --          --         --

  Shares used in diluted earnings per share
     calculations                                     977       1,057        997

Pro forma basic earnings per share               $  (2.38)   $   0.47   $   0.09

Pro forma diluted earnings per share             $  (2.38)   $  0. 43   $   0.09


NOTE I  - INCOME TAXES

    CableTEl AD pays income tax in Bulgaria based on their stand alone earnings.
    CIC will not pay income tax for the  earnings of CableTEL AD until such time
    as such earnings are remitted to the United States.

    Prior to the  acquisition  of CableTEL AD CIC had net  operating  loss carry
    forwards of approximately  $22,500,000,  which expire between 2004 and 2022.
    As a result of the CIC's  acquisition of CableTEL AD a change of control has
    been deemed to have occurred and as a result to remaining  carry forwards to
    offset future operating  profits have limitations that restrict  utilization
    to  approximately  $70,000 for any one year for the next fifteen years.  CIC
    may however  utilize the benefit of certain of the  remaining  net operating
    loss carry forwards to increase the basis of its assets to their fair market
    value at the date of the acquisition




                                      F-18
<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE I  - INCOME TAXES - Continued

    Deferred tax assets and  liabilities  were  comprised of the  following  (in
    thousands):
                                                                 December 31,
                                                            --------------------
                                                              2004        2003
                                                            --------    --------

    Deferred tax assets:
       Net operating loss carry forwards                    $    357    $   --
       Other                                                     344
                                                            --------    --------

       Total deferred tax assets                                 701

    Valuation allowance                                         (701)       --
                                                            --------    --------

       Net deferred tax asset                               $   --      $   --
                                                            ========    ========

    The company does not estimate any tax significant tax income or loss for the
    year ended  December 31, 2004. The  historical  financials  presented do not
    represent the historical taxpayer as such, historical  information regarding
    taxes have not been included.

    Changes in the deferred tax valuation allowance result from assessments made
    by the Company each year of its expected future taxable income  available to
    absorb its carry forwards. The Company believes that the deferred tax assets
    will not be realized.  However,  this evaluation is inherently subjective as
    it requires  estimates that are susceptible to significant  revision as more
    information becomes available.

NOTE J - STOCKHOLDERS' EQUITY

    Outstanding Preferred Stock
    ---------------------------

    Preferred stock consists of the following (amounts in thousands):

                                                                  Year ended
                                                                 December 31,
                                                             -------------------
                                                               2004       2003
                                                             --------   --------

Series B cumulative convertible preferred stock,
  $.10 par value; liquidation value of $100;
  authorized, 100 shares; issued and outstanding, 1 share    $      1   $      1
                                                             ========   ========

Series J cumulative non-convertible preferred stock,
  $.10 par value; liquidation value of $1000; authorized,
  31500 shares; issued and outstanding 31,500 shares         $ 31,500   $   --
                                                             ========   ========



                                      F-19
<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE J - STOCKHOLDERS' EQUITY - Continued

    The Series B preferred  stock has a liquidation  value of $100 per share and
    is convertible into common stock over a ten-year period at prices escalating
    from  $500 per  share in 1993 to  $1,111  per  share by 2002.  The  right to
    convert  expired  April 30,  2003.  Dividends at a rate of 6% are payable in
    cash or preferred shares at the option of the Company.

    The Series J stock is non-convertible however the Company has agreed to hold
    a shareholder vote to allow the Series J shareholders to covert their 31,500
    shares of preferred into 8,788,000 shares of the Company's common stock


    Stock Options
    -------------

    In 1997, the Company  established a long-term incentive plan (the 1997 Plan)
    for the benefit of certain key employees. Options granted to employees under
    the 1997 Plan become  exercisable over a period as determined by the Company
    and may be exercised up to a maximum of 5 years from date of grant. The 1997
    Plan  allowed  up to  50,000  shares  of the  Company's  common  stock to be
    reserved for issuance.  In 2000,  the Company  adopted the 2000 Stock Option
    Plan,  under which up to 50,000  shares of the  Company's  common  stock are
    reserve for issuance.

    The  Company  granted  options to two  officers  during 1996  through  2001,
    aggregating  80,000  shares not covered by either plan.  These  options were
    granted at market,  were exercisable  immediately,  and expire 10 years from
    date of grant.












                                      F-20
<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE J - STOCKHOLDERS' EQUITY - Continued

    Information with respect to stock option activity is as follows:

                                                                        Weighted
                                                                         average
                                                                        exercise
                                                             Shares      price
                                                            --------    --------

    Outstanding at January 1, 2002                           160,850    $  81.28

       Expired                                                (5,050)     182.58
                                                            --------    --------

    Outstanding at December 31, 2002                         155,800    $  78.00

       Granted                                                60,000        2.60
       Cancelled, rescinded, or annulled                     (70,800)     109.27
       Expired                                                (3,000)     112.50

    Outstanding at December 31, 2003 and 2004                142,000    $  30.27
                                                            ========    ========


    Options exercisable at December 31, 2002                 155,800    $  78.00
                                                            ========    ========

    Options exercisable at December 31, 2003 and 2004        142,000    $  30.27
                                                            ========    ========

    Weighted  average  fair value per share of options  granted  during 2003 and
    2001 was $0.71 and $7.60, respectively.

    Additional  information about stock options outstanding at December 31, 2004
    is summarized as follows:

                                         Options outstanding and exercisable
                                ------------------------------------------------
                                              Weighted average       Weighted
                                   Number        remaining            average
     Range of exercise prices   outstanding   contractual life    exercise price
     ------------------------   -----------   -----------------   --------------

     $2.60                           60,000           4.0         $   2.60
     $3.75 to $6.90                  60,000           6.0             5.68
     $100.00 to $150.39               2,000           1.0           150.39
     $175.00                         20,000           3.0           175.00





                                      F-21
<PAGE>
<TABLE>
<CAPTION>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE K - OTHER INCOME (EXPENSE)

    Other income (expenses) consists of the following: (amounts in thousands)

                                                     Year ended December 31,
                                                 -------------------------------
                                                   2004        2003       2002
                                                 --------    --------   --------

    Gain (loss) on sale of properties            $   (162)   $   --     $   --
    Advertisement revenue                              32        --         --
    Miscellaneous service fees                        472         389          1
    Other                                             (17)       --         --
                                                 --------    --------   --------

                                                 $    325    $    389   $      1
                                                 ========    ========   ========


NOTE L - CASH FLOW INFORMATION

    Supplemental information on cash flows is as follows (in thousands):

                                                                 Year ended December 31,
                                                              ------------------------------
                                                                2004       2003       2002
                                                              --------   --------   --------
<S>                                                           <C>        <C>        <C>
Interest paid                                                 $    329   $   --     $     17
Income taxes paid                                                   31         43         69

Non-cash investing and financing activities (in thousands):
   Issuance of Series J preferred stock for assets               3,500       --         --
   Unrealized foreign currency translation loss                    190       --         --
   Unrealized foreign currency translation gain                   --          797        407
   Notes payable from acquisition                                8,244       --         --
   Write-up of goodwill from acquisition                         5,100       --         --

   Minority interest increase from acquisition                   2,777
   Purchase of property and equipment
    vendor financed                                              8,200       --         --
</TABLE>


NOTE M - DISCONTINUED OPERATIONS AND SALES OF REAL ESTATE

    Discontinued Operations was a loss of $508,000 in 2002. During 2000 and 2001
    CableTEL's  growth  occurred by acquiring  other existing  cable  operators.
    During that period in time cable  operators  in  Bulgaria  were  required to
    actually  own and  operate TV  studios.  In early 2003  CableTEL AD sold its
    studio operations. Any gain or loss in 2003 was immaterial and the loss from
    operations in 2002 was $508,000.



                                      F-22

<PAGE>
<TABLE>
<CAPTION>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE N - SEGMENT REPORTING

Business Operations

    The Company operates three separate distinct businesses

    o   The Company's  principal  business is  telecommunications  activities in
        Bulgaria  and  surrounding   countries   including   subscription  cable
        television, fixed voice telephony services and data services.

    o   The  ownership  and  operation  of real estate  through  one  retirement
        community  in King  City,  Oregon,  with a  capacity  of 114  residents,
        leasing  of a  residential  retirement  property  to a  third  party  in
        Greenville, South Carolina and ownership and operation of an outlet mall
        in Gainesville,  Texas with approximately  315,000 square feet of retail
        space available for lease.

    o   The ownership of oil and gas leases in Gregg and Rusk Counties, Texas on
        which 48 producing wells were operating as of March 31, 2005.

    The segment  information and reconciliation to income (loss) from operations
    that follows  includes the Bulgarian  telecommunications  activities for the
    twelve months ended  December 31, 2004 and the US  operations  for the three
    months ended December 31, 2004.

Twelve months ended December 31, 2003 (amounts in thousands)

                                                                                  Real            Oil       Consolidated
                                                    Cable        Corporate       Estate        Operation        CIC
                                                 ----------------------------------------------------------------------
Revenue                                                9,463                         1,173            413        11,049
                                                 ----------------------------------------------------------------------
<S>                                              <C>            <C>            <C>            <C>           <C>
Operating expenses
     Cable operations                                  6,226                           722            237          7,185
     Lease expense                                       947                           231                         1,178
     Depletion, depreciation and  amortization         1,473                           112             27          1,612
     Corporate general and administrative              3,917            249          4,166
                                                 ----------------------------------------------------------------------
                                                      12,563            249          1,065            264        14,141
                                                 ----------------------------------------------------------------------

Operating earning  (loss)                             (3,100)          (249)           108            149        (3,092)

Interest Expense                                         268            478            180                          926
Gain on sale of assets                                   844                                                        844
Net earnings (loss)                                   (1,979)          (312)           (23)           149        (2,165)
Total Assets                                          23,755         10,310         14,833          1,615        50,513
</TABLE>


                                      F-23

<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



NOTE O - CONTINGENCIES

    Cable Partners Bulgaria LLC vs. Greenbriar Corporation and Ronald C. Finley
    ---------------------------------------------------------------------------

    On January  24,  2005 a lawsuit  was filed in the  District  Court of Dallas
    County,  Texas by Cable Partners  Bulgaria LLC,  ("CPB") a Colorado  limited
    liability  company  against the Company.  The lawsuit states that on October
    12, 2004 CPB entered into a letter  agreement  with the owners of Eurocom to
    acquire  the  assets of  Eurocom,  a cable  operator  in the city of Plovdiv
    Bulgaria.  The lawsuit  further  indicates  that the October 12, 2004 letter
    outlines a time line for the completion of due diligence by CPB. The lawsuit
    states   that  in  November   2004  a   conversation   occurred   between  a
    representative of CPB and Ronald Finley, CEO of both CIC and CableTEL during
    which time such  representative told Mr. Finley that CPB had an agreement to
    purchase Eurocom.

    The lawsuit alleges that CIC intentionally and improperly caused the sellers
    of Eurocom to enter into  discussions  with CableTEL which ultimately led to
    CableTEL  entering  into a  separate  and  competing  contract  to  purchase
    Eurocom.  CPB alleges that the Company's  interference was improper and that
    CPB has been  damaged  in the  amount  of at least  (euro)4.5  million.  The
    lawsuit  further  alleges that CPB's letter  agreement  provided for a three
    year management agreement with the sellers of Eurocom and that CPB was would
    be further damaged by the loss of the experience,  expertise and contacts of
    the sellers of Eurocom in an amount to be determined  at trial.  CPE further
    seeks exemplary damages of an unspecified amount.

    The Company believes the lawsuit is totally without merit. CableTEL had been
    holding  discussions,  conducting  due diligence and had agreements in place
    with  the  owners  of  Eurocom  well  before  either  the  alleged  November
    conversation  or the  October  12,  2004  letter.  In  addition  the Company
    believes  the  lawsuit  misstates  certain key facts which could prove to be
    critical in CPB's ability to prevail in this matter.

    Other
    -----

    The Company has been named as a defendant in other  lawsuits in the ordinary
    course of business.  Management  is of the opinion that these  lawsuits will
    not have a material effect on the financial condition, results of operations
    or cash flows of the Company.




                                      F-24
<PAGE>

               CabelTel International Corporation and Subsidiaries

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                                December 31, 2004


                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




NOTE P - Related Parties

    On October 1, 2003 CableTEL AD entered into a consulting agreement with Gene
    E. Phillips  whereby Mr. Phillips is to receive  (euro)15,000  per month for
    consulting  services.  These services include technical and financial advice
    to CableTEL The initial  agreement was amended on March 26, 2004 to extended
    the  agreement to March 26, 2009.  This  agreement  may be  terminated  upon
    mutual  consent of the parties or by any of the  parties  with a three month
    written notification.

    Global Communication  Technologies,  Inc. ("Globaltec") is a manufacturer of
    telecommunications  switching  equipment.  Globaltec  is owned by  Ronald C.
    Finley,  Jeffrey Finley (brother to Ronald Finley) and Gene E. Phillips.  In
    2004 CableTEL AD paid  $1,992,284 to Globaltec for the purchase of hardware,
    software and licensing. In addition,  CableTEL AD paid Globaltec's Bulgarian
    subsidiary  $164,250 in consulting fees to implement the switching equipment
    installation and management.

    The Company through  subsidiaries  owns 30% of CableTEL AD directly and owns
    64% of Narisma Holdings,  Ltd., a Cyprus company that owns the remaining 70%
    of CableTEL AD.  Collectively,  the Company has effective ownership of 74.8%
    of CableTEL AD. In January 2005 Envicon Development  Corporation,  a company
    indirectly  owned by Gene E. Phillips  acquired the 36% of Narisma  Holdings
    Limited which represents 25.2% of CableTEL AD.

















                                      F-25