UNAUDITED THE KOLBER TRUST BALANCE SHEET AS AT DECEMBER 31, 1996 (expressed in United States dollars) ASSETS 1995 Cash and cash equivalents Cash at call Fixed deposits Accounts receivable Investments Short term investments Bonds and debentures Shares and capital notes - Exchange traded Shares and capital notes - Non exchange traded Total assets 585,957 180,000 15,820 420,000 765,957 435,820 369,243 191,896 7,775,517 8,935,361 10,719,880 10,015,194 3,856,110 7,949,292 9,026,509 7,575,406 37,445,952 28,407,317 38,581,152 29,035,033 LIABILITIES Loans Accounts payable and accrued expenses Total liabilities NET ASSETS Representing: Capital account Income account (36,502) (4,859,003) (195,052) (36,502) (5,054,055) $ 38,544,650 23,980,978 36,668,196 1,876,454 23,525,663 455,315 $ 38,544,650 For and on behalf of Cayman International Trust Company Limited Trustee $ 23,980,978 UNAUDITED THE KOLBER TRUST INCOME ACCOUNT FOR THE PERIOD ENDED 31 DECEMBER 1996 (expressed in United States dollars) INCOME Interest on bank and broker deposits Interest on bonds and debentures Interest on short term investments Dividends on shares and capital notes 1995 58,332 829,685 252,196 494,945 21,120 251,269 68,854 994,706 1,635,158 1,335,949 154,830 1,766 46,626 3,500 2,593 2,310 1,610 785 539,193 32,758 277,465 16,897 2,594 3,549 8,160 18 214,019 880,634 1,421,139 455,315 EXPENSES Interest on loans and debentures Interest expenses Trustee management fees Advisory fees and expenses Audit and accounting fees Safe custody fees Communication charges Bank charges and overdraft interest Miscellaneous expenses NET INCOME FOR THE PERIOD BALANCE BROUGHT FORWARD BALANCE CARRIED FORWARD 455,315 $1,876,454 $455,315 UNAUDITED THE KOLBER TRUST CAPITAL ACCOUNT FOR THE PERIOD ENDED 31 DECEMBER 1996 (expressed in United States dollars) 1995 BALANCE BROUGHT FORWARD 23,525,663 8,984,444 Net realised gains on disposal of investments 15,309,808 14,563,953 Unrealized loss on investments (1,265,001) - Gain on equalization payments Legal fees Loss on exchange Capital distributions 1,533,263 (39,914) (71) (2,395,552) (22,735) - BALANCE CARRIED FORWARD $ 36,668,196 $23,525,663 KOLBER TRUST UNAUDITED PORTFOLIO OF INVESTMENT SECURITIES FOR THE YEAR ENDED DECEMBER 31, 1996 (expressed in United States dollars) BROUGHT FORWARD AS AT Nominal JANUARY 1, 1996 Cost $ CARRIED FORWARD AS AT ADDITIONS Value $ Nominal Cost $ Nominal Cost $ SALES Proceeds $ DECEMBER 31, 1996 Nominal Cost Value $ $ Profit $ BONDS & DEBENTURES A.K. Steel Holding Corp 10.75% due Apr 1, 2004 250,000 251,875 Argentina Par Mn 5.00% due Mar 31, 2023 1,000,000 530,000 277,500 568,750 Argentina Republic of 9.25% due Feb 23, 2001 Bally Park Place Funding 9.25% due Feb 23, 2001 Bankamerica Corp 9.50% due Apr 1, 2001 1,000,000 1,017,500 1,012,500 250,000 261,357 289,165 Citicorp Sub Sec 7.125% due Jun 1, 2003 Essex Group Inc sr. notes 10.00% due May 1, 2003 Fedral Nationl Mrtg Asociation 6.69% due Jul 28, 2000 Fedrtd Dprtmnt Stor sr notes 10.00% due Feb 15, 2001 250,000 1,000,000 567,500 500,000 499,330 1,000,000 350,000 364,508 251,875 1,017,500 273,750 21,875 - - 1082100 64,600 - - - 2,000,000 1,097,500 1,262,500 500,000 499,330 508,125 - - - 250,000 261,357 276,278 350,000 364,508 355,096 300,000 297,000 294,750 300,000 297,000 310,500 1,000,000 1,008,125 1,022,580 1,000,000 1,008,125 1,005,520 250,000 250,000 273,125 250,000 250,000 271,303 KOLBER TRUST UNAUDITED PORTFOLIO OF INVESTMENT SECURITIES FOR THE YEAR ENDED DECEMBER 31, 1996 (expressed in United States dollars) BROUGHT FORWARD AS AT Nominal Ferrell Gas LP Finance Corp 10.00% due Aug 1, 2001 JANUARY 1, 1996 Cost $ 250,000 246,875 ADDITIONS Value $ 250,000 250,000 244,415 Grupo Televisa Sa De Cv 10.00% due Nov 9, 1997 250,000 255,625 Cost $ Nominal Cost $ SALES Proceeds $ Profit $ 250,000 267,275 Goldman Sachs Group 7.25% due Oct 1, 2005 Heritage Media Services 11.00% due Jun15, 2002 Nominal 266,250 Forcenergy Inc(Sr. Sub Notes) 9.50% due Nov 1 2006 Genral Motors Aceptnce Corp 8.00% due Oct 1, 1999 CARRIED FORWARD AS AT 350,000 357,000 361,375 Nabisco Inc. Notes 6.85% due Jun 15, 2005 250,000 248,035 254,895 Paging netwrk Inc. Sr. notes 10.125% due Aug1, 2007 250,000 250,000 272,500 246,875 263,125 250,000 250,000 260,625 250,000 244,415 259,033 419,384 400,000 419,384 404,052 1,000,000 1,037,500 1,000,000 1,037,500 1,026,875 350,000 Mobil Mdia Corp Sr Sub Notes 9.375% due Nov 1, 2007 250,000 400,000 267,500 Lamar Advertising 11.00% due May 15, 2003 DECEMBER 31, 1996 Nominal Cost Value $ $ 372,818 250,000 255,625 264,375 8,750 - - - 350,000 372,818 389,995 17,176 - - - 357,000 234,500 (122,500) - - - 350,000 150,000 150,549 400,000 398,584 391,644 250,000 250,000 255,000 KOLBER TRUST UNAUDITED PORTFOLIO OF INVESTMENT SECURITIES FOR THE YEAR ENDED DECEMBER 31, 1996 (expressed in United States dollars) BROUGHT FORWARD AS AT Nominal Poland PDI Bearer 3.75% due Oct 27, 2014 JANUARY 1, 1996 Cost $ 2,000,000 1,298,750 ADDITIONS Value $ Nominal Cost $ 1,305,000 Poland RSTA Bonds 2.75% due Oct 27, 2024 Rogers Comunications 10.875%due Apr15,2004 CARRIED FORWARD AS AT Nominal 2,000,000 2,000,000 Cost $ SALES Proceeds $ 1,298,750 1,557,500 Profit $ 258,750 1,142,500 DECEMBER 31, 1996 Nominal Cost Value $ $ - - - 2,000,000 1,142,500 1,250,000 250,000 253,750 261,562 250,000 253,750 262,500 9.00% due Mar 1, 2002 300,000 312,000 319,500 300,000 312,000 307,500 Tele Comunications Inc 10.125% due Aug 1, 2001 250,000 264,452 291,200 TLC Beatrice Intl Hldg Sr Notes 11.50% due Oct 1, 2005 350,000 345,188 340,375 350,000 345,188 372,750 Viacom Inc Sr. Notes 7.75% due Jun 1, 2005 250,000 257,345 265,078 250,000 257,345 244,825 7,949,292 8,210,880 8,935,361 9,287,251 Tarkett Intl. Gmbh 250,000 4,804,089 264,452 3,818,020 262,500 4,064,720 (1,952) 246,699 - - - KOLBER TRUST UNAUDITED PORTFOLIO OF INVESTMENT SECURITIES FOR THE YEAR ENDED DECEMBER 31, 1996 (expressed in United States dollars) BROUGHT FORWARD AS AT Nominal JANUARY 1, 1996 Cost $ CARRIED FORWARD AS AT ADDITIONS Value $ Nominal Cost $ Nominal Cost $ SALES Proceeds $ DECEMBER 31, 1996 Nominal Cost Value $ $ Profit $ SHORT TERM INVESTMENTS US Treasury bill due Jan 02, 96 27,000 26,279 27,000 26,279 26,279 - - - - US Treasury bill due Feb 22,96 809,000 798,618 809,000 798,618 801,623 3,005 - - - 3,080,000 3,031,213 US Treasury bill due Mar 14, 96 3,080,000 3,031,213 3,038,795 7,582 - - - Fdrl Home LMC due Aug 01, 96 1,090,000 1,076,115 1,090,000 1,076,115 1,077,417 1,303 - - - Fdrl NtnlMtgAso due Oct 15.96 1,000,000 973,288 1,000,000 973,288 973,288 - - - - Fdrl NtnlMtgAso due Oct 24.96 530,000 516,478 530,000 516,478 519,327 2,849 - - - Fdrl NtnlMtgAso due Jan 15.97 6,960,000 6,783,634 6,960,000 6,783,634 6,943,992 Fdrl Home LMC due Jan 24.97 500,000 498,090 500,000 498,090 498,150 Fdrl Home LMC due Mar 24.97 500,000 493,793 500,000 493,793 493,750 7,775,517 7,935,892 3,856,110 10,341,398 6,421,991 6,436,730 14,739 KOLBER TRUST UNAUDITED PORTFOLIO OF INVESTMENT SECURITIES FOR THE YEAR ENDED DECEMBER 31, 1996 (expressed in United States dollars) BROUGHT FORWARD AS AT Nominal JANUARY 1, 1996 Cost $ CARRIED FORWARD AS AT ADDITIONS Value $ Nominal Cost $ Nominal Cost $ SALES Proceeds $ Profit $ DECEMBER 31, 1996 Nominal Cost Value $ $ QUOTED SECURITIES Assocites First Capital Corp 500 14,500 500 14,500 17,149 2,649 - - - Check Point Software Tech 50 700 50 700 1,113 413 - - - 5,000 391,075 Citicorp ECI Telecm Ltd.Comon shares 713,056 3,412,782 Evergreen Capital Markets Ltd 60,604 95,978 16,266,946 50,000 398,475 713,056 52,119 The Gap Inc. Geotek Comunic Comon shars 5,000 315,625 Geotek Stock 60,604 95,978 77,173 (18,805) 5,000 146,938 10,681 75,635 50,000 398,475 465,250 66,775 8,606 83,220 8,606 83,220 69,921 (13,298) - 391,075 3,412,782 - 515,000 15,330,704 - 5,000 146,937 150,625 10,681 75,635 76,102 - - - Geotek Comuniction Pfd shars 3,000 3,000,000 3,000 2,137,500 2,137,500 Neuromedical Systems Ltd. 4,000 89,000 4,000 89,000 53,000 Osem Investmnts Ltd. 2,663,089 3,477,856 15,621,680 2,500 250,000 250,000 2,500 250,000 250,000 Teva Pharmac Comon shares 15 11 70 15 11 70 Teva Pharmac ADR'S shares 196,248 1,391,406 9,101,001 269,748 4,216,940 13,554,837 9,026,508 41,607,441 Tescorp Inc 8%Conv pfd Ser95 181,054 73,500 2,663,089 3,658,910 18,641,623 14,982,713 2,825,534 6,807,655 4,251,783 19,272,230 15,020,447 - - 10,719,880 - 32,067,838 KOLBER TRUST UNAUDITED PORTFOLIO OF INVESTMENT SECURITIES FOR THE YEAR ENDED DECEMBER 31, 1996 (expressed in United States dollars) BROUGHT FORWARD AS AT Nominal JANUARY 1, 1996 Cost $ CARRIED FORWARD AS AT ADDITIONS Value $ Nominal Cost $ Nominal Cost $ SALES Proceeds $ DECEMBER 31, 1996 Nominal Cost Value $ $ Profit $ UNQUOTED SECURITIES 4 Brown McMillan 360,000 4 360,000 360,000 Dorvat Shrem Rainbow fund 15,000 150,000 150,000 15,000 150,000 150,000 Evergreen Intl Investmnt NV 120 600,000 600,000 120 600,000 600,000 1 600,000 600,000 536 477,496 477,496 290,124 201,250 201,250 1 GS Mezzanine Offshore partnr 600,000 536 477,496 477,496 Jerusalem Report Comon shrs 72,033 435,000 435,000 Jerusalem Report Capital Note 168,750 168,750 168,750 168750 126,109 1 1 126,109 Isrex (94) Ltd. 218,091 168,750 168,750 168,750 - - - - 1 - - - - Cnverted to comon shs on dec 1 1996 Luz International 224,000 Lynx Acquisition Corp 1 224,000 1,470,789 224,000 224,000 224,000 500 4,714,698 4,714,698 Renaissance Fund LDC 500 3,243,909 3,243,909 RM Renaisance Management 250 250 250 250 250 250 Superbowl Acquisition LDC 250 2,500,000 2,500,000 250 2,500,000 2,500,000 556 187,500 187,500 556 Tisom(Tel Aviv Intl school mgmt) 7,575,406 7,575,406 187,500 3,011,039 168,751 168,751 - 10,015,194 10,015,194