UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2002 Commission File No.0-6119
TRI-VALLEY CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE 84-0617433
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
5555 BUSINESS PARK SOUTH, SUITE 200, BAKERSFIELD, CALIFORNIA 93309
(Address of principal executive offices)
(661) 864-0500
(Registrant's telephone number, including area code)
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 [ ]
The number of shares of Registrant's common stock outstanding at September 30,
2002 was 19,710,748.
TRI-VALLEY CORPORATION
INDEX
Page
--------------
PART I - FINANCIAL INFORMATION. . . . . . . . . . . . . . . . . . . . . 3
Item 1. Consolidated Financial Statements. . . . . . . . . . . . . 3
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . 9
Item 3. Quantitative and Qualitative Disclosures About Market Risk 11
Item 4. Controls and Procedures. . . . . . . . . . . . . . . . . . 11
PART II - OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . . 11
Item 1. Legal Proceedings. . . . . . . . . . . . . . . . . . . . . 11
Item 2. Changes in Securities. . . . . . . . . . . . . . . . . . . 11
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . 11
SIGNATURES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
The accompanying notes are an integral part of these
condensed financial statements.
3
PART I - FINANCIAL INFORMATION
ITEM 1. UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
-----------------------------------------------------------------------
TRI-VALLEY CORPORATION
CONSOLIDATED BALANCE SHEETS
ASSETS
September 30, 2002. .Dec. 31, 2001
(Unaudited) (Audited)
------------ -------------
Current Assets
Cash . . . . . . . . . . . . $ 2,371,479 $ 911,913
Accounts receivable, trade . 112,867 107,225
Prepaid expenses . . . . . . 12,029 12,029
------------ -------------
Total Current Assets . . . 2,496,375 1,031,167
------------ -------------
Property and Equipment, Net. . 2,089,471 2,010,457
------------ ------------
Other Assets
Deposits . . . . . . . . . . 104,705 104,705
Investments in partnerships. 9,101 9,101
Other. . . . . . . . . . . . 13,913 13,913
Goodwill (net of accumulated
amortization of $221,439
at December 31, 2001 . . . 212,414 212,414
------------ -----------
Total Other Assets . . . 340,133 340,133
------------ -----------
Total Assets . . . . . . $ 4,925,979 $ 3,381,757
============ ==============
The accompanying notes are an integral part of these
condensed financial statements.
4
LIABILITIES AND SHAREHOLDERS' EQUITY
September 30, 2002 Dec. 31, 2001
-------------------- ---------------
CURRENT LIABILITIES
Notes and contracts payable. . . . . $ 1,743 $ 8,265
Trade accounts payable . . . . . . . 1,038,002 297,001
Amounts payable to joint venture
participants . . . . . . . . . . . 55,917 59,631
Advances from joint venture
participants . . . . . . . . . . . 2,968,658 2,654,713
-------------------- ---------------
Total Current Liabilities. . . . . 4,064,320 3,019,610
-------------------- ---------------
Long-term Portion of Notes and
Contracts Payable. . . . . . . . . . 41,029 8,371
-------------------- ---------------
Commitments
Shareholders' Equity
Common stock, $.001 par value:
100,000,000 shares authorized;
19,710,748 and 19,689,748 issued
and outstanding at Sept 30, 2002
and Dec. 31, 2001, respectively. . 19,716 19,555
Less: Common stock in treasury,
at cost, 163,925 shares . . . . . . (21,913) (21,913)
Capital in excess of par value . . . 8,766,327 8,746,653
Accumulated deficit. . . . . . . . . (7,943,500) (8,390,654)
-------------------- ---------------
Total Shareholders' Equity . . . . 820,630 353,776
-------------------- ---------------
Total Liabilities and
Shareholders' Equity . . . . . . $ 4,925,979 $ 3,381,757
==================== ===============
The accompanying notes are an integral part of these
condensed financial statements.
5
TRI-VALLEY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Months For the Nine Months
2002 2001 2002 2001
----------- ------------ ----------- -----------
Revenues
Sale of oil and gas . . . . . . . . . . . . . . . . . $ 178,218 $ 177,904 $ 533,614 $ 1,451,666
Other income. . . . . . . . . . . . . . . . . . . . . 19,293 116,351 59,291 190,043
Sale of direct working interest . . . . . . . . . . . 3,720,657 -0- 4,358,047 -0-
Interest income . . . . . . . . . . . . . . . . . . . 5,707 4,305 12,898 20,807
----------- ------------ ----------- -----------
Total Revenues. . . . . . . . . . . . . . . . . . . 3,923,875 298,560 4,963,850 1,662,516
----------- ------------ ----------- -----------
Cost and Expenses
Oil and gas lease expense . . . . . . . . . . . . . . 23,572 45,765 161,260 288,309
Mining exploration expenses . . . . . . . . . . . . . 33,538 70,347 76,355 125,729
Project geology, geophysics,
land & administration . . . . . . . . . . . . . . . 1,027,213 54,137 1,293,401 256,091
Cost of sale of asset . . . . . . . . . . . . . . . . 1,487,689 -0- 2,115,375 -0-
Depletion, depreciation and amortization. . . . . . . 12,982 16,102 38,945 45,834
Interest. . . . . . . . . . . . . . . . . . . . . . . 602 690 1,079 3,446
General administrative. . . . . . . . . . . . . . . . 266,726 283,691 830,281 798,819
----------- ------------ ----------- -----------
Total Cost and Expenses . . . . . . . . . . . . . . 2,852,322 470,732 4,516,696 1,518,228
----------- ------------ ----------- -----------
Net Income/(Loss) . . . . . . . . . . . . . . . . . . . $ 1,071,553 $ (172,172) $ 447,154 $ 144,288
=========== ============ =========== ===========
Net Income (Loss) per Common Share. . . . . . . . . . . $ .05 $ (.01) $ .02 $ .01
=========== ============ =========== ===========
Weighted Average Number of Shares . . . . . . . . . . . 19,707,248 19,689,748 19,707,248 19,689,748
=========== ============ =========== ===========
The accompanying notes are an integral part of these
condensed financial statements.
6
TRI-VALLEY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
For the Nine Months
----------------------
Ended Sept 30,
----------------
2002 2001
----------- -----------
Cash Flows from Operating Activities
Net loss/profit . . . . . . . . . . . . . . . . . . . . . $ 447,154 $ 144,288
Adjustments to reconcile net income
to net cash used from operating activities:
Depreciation, depletion and amortization. . . . . . . 38,945 45,834
Shares issued officer compensation. . . . . . . . . . 11,700 -0-
Changes in operating capital:
Amounts receivable-(Increase)decrease . . . . . . . . (5,642) 690,272
Trade accounts payable-Increase(decrease) . . . . . . 767,137 (425,096)
Amounts payable to joint venture
participants and related parties-Increase(decrease) (3,714) (445,068)
Advances from joint venture
Participants-Increase(decrease) . . . . . . . . . . 313,945 (109,039)
----------- -----------
Net Cash Used by Operating Activities . . . . . . . . . . . 1,569,525 (98,809)
----------- -----------
Cash Flows from Investing Activities
Capital expenditures. . . . . . . . . . . . . . . . . . . (117,959) (652,738)
----------- -----------
Cash Flows from Financing Activities
Principal payments on long-term debt. . . . . . . . . . (135) (5,104)
Proceeds from issuance of common stock. . . . . . . . . . 8,135 57,000
----------- -----------
Net Cash Provided (used) by Financing Activities. . . 8,000 51,896
----------- -----------
Net Increase (Decrease) in Cash and Cash Equivalents. . . . 1,459,566 (699,651)
Cash and Cash Equivalents at Beginning
Of Period . . . . . . . . . . . . . . . . . . . . . . . . 911,913 1,373,570
----------- -----------
Cash and Cash Equivalents at
End of Period . . . . . . . . . . . . . . . . . . . . . . $2,371,479 $ 673,919
=========== ===========
Supplemental Information:
Cash paid for interest. . . . . . . . . . . . . . . . . . $ 1,079 $ 3,446
Cash paid for taxes . . . . . . . . . . . . . . . . . . . $ 5,137 $ 7,779
8
TRI-VALLEY CORPORATION
NOTES TO CONDENSED FINANCIAL STATEMENTS
FOR THE NINE MONTHS ENDED
SEPTEMBER 30, 2002 AND 2001
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
-----------------------
The financial information included herein is unaudited; however, such
information reflects all adjustments (consisting solely of normal recurring
adjustments), which are, in the opinion of management, necessary for a fair
statement of results for the interim periods. The results of operations for the
nine-month period ended September 30, 2002, are not necessarily indicative of
the results to be expected for the full year.
The accompanying consolidated financial statements do not include footnotes and
certain financial presentations normally required under generally accepted
accounting principles; and, therefore, should be read in conjunction with the
Company's Annual Report on Form 10-KSB for the year ended December 31, 2001.
NOTE 2 - PER SHARE COMPUTATIONS
------------------------
Per share computations are based upon the weighted average number of common
shares outstanding during each year. Common stock equivalents are not included
in the computations since their effect would be anti-dilutive.
NOTE 3 - RECENT ACCOUNTING PRONOUNCEMENTS
----------------------------------
On January 1, 2002, we adopted Financial Accounting Standards Board (FASB)
Statement of Financial Accounting Standards (SFAS) No. 142, "Goodwill and Other
Intangible Assets" (SFAS 142). Under SFAS 142, goodwill is a nonamortizable
asset, and is subject to an annual review for impairment, and an interim review
when certain events or circumstances occur that indicate the carrying value may
not be recoverable. Under SFAS 142, we had a transitional period of six months
from the date of adoption to complete our goodwill impairment testing. We
evaluated the recoverability of the recorded amount of goodwill based on certain
operating and financial factors. Such impairment testing included discounted
cash flow tests which require broad assumptions and significant judgment to be
exercised by management. As a result of this analysis, no impairment of
goodwill was identified.
On January 1, 2002, we adopted SFAS No. 144, "Accounting for Impairment or
Disposal of Long-Lived Assets" (SFAS 144). Under SFAS 144, long-lived assets to
be disposed of are measured at the lower of carrying amount or fair value less
costs to sell, whether reported in continuing operations or in discontinued
operations. Discontinued operations will no longer be measured at net
realizable value or include amounts for operating losses that have not yet
occurred. A long-lived asset must be tested for impairment whenever events or
changes in circumstances indicate that its carrying amount may be impaired. The
implementation of this standard had no effect on results of operations.
In July 2001, the FASB issued SFAS No. 143, "Accounting for Asset Retirement
Obligations" (SFAS 143). Under SFAS 143, the fair value of a liability for an
asset retirement obligation should be recorded in the period in which it is
incurred. Upon settlement of the liability, an entity either settles the
obligation for its recorded amount or incurs a gain or loss if the settled
amount differs from the liability recorded. SFAS 143 is effective for fiscal
years beginning after June 15, 2002. We are currently evaluating this guidance
and have not determined the impact on our financial position, results of
operations, or net cash flows, however, such impact could be material.
In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs Associated
with Exit or Disposal Activities" (SFAS 146). SFAS 146 addresses the financial
accounting and reporting for costs associated with exit or disposal activities.
SFAS 146 states that a liability for a cost associated with an exit or disposal
activity shall be recognized and measured initially at its fair value in the
period when the liability is incurred. A liability is established only when
present obligations to others are determined. SFAS 146 does not apply to costs
associated with the retirement of long-lived assets covered in SFAS 143 (see
above). It applies to costs associated with an exit activity that does not
involve an entity newly acquired in a business combination or with a disposal
activity covered by SFAS 144 (see above). We will apply SFAS 146 for exit or
disposal activities initiated after December 31, 2002. We are evaluating this
guidance and do not believe that it will have a material impact on our financial
position, results of operations, or net cash flows.
17
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
-----------------------------------------------------------------------
OF OPERATIONS
--------------
BUSINESS REVIEW
Notice Regarding Forward-Looking Statements
----------------------------------------------
This report contains forward-looking statements. The words, "anticipate,"
"believe," "expect," "plan," "intend," "estimate," "project," "could," "may,"
"foresee," and similar expressions are intended to identify forward-looking
statements. These statements include information regarding expected development
of the Company's business, lending activities, relationship with customers, and
development in the oil and gas industry. Should one or more of these risks or
uncertainties occur, or should underlying assumptions prove incorrect, actual
results may vary materially and adversely from those anticipated, believed,
estimated or otherwise indicated.
Petroleum Activities
---------------------
We began drilling the Sunrise-Mayel No. 2-H on July 12, 2002. Next, we
hydraulically fractured the well, which was done on September 7, 2002. We are
cleaning out the "frac" fluids and evaluating the results.
We are planning to commence drilling the Aurora #1-19 well in November. The
well is a 5,800' deep test well. It is estimated to take 19 days to drill and
another 12 days to complete.
Precious Metals
----------------
We had no activity on our Alaska claims block this season. We were unable to
secure funding timely enough to allow any significant work to be performed.
Hopefully, we will be able to secure financing earlier in 2003 to allow us to do
some of the additional work that is needed.
Three Months Ended Sept. 30, 2002 as compared with Three Months ended Sept. 30,
--------------------------------------------------------------------------------
2001
----
In the quarter ended September 30, 2002 total revenue was $3,923,875 compared to
$298,500 for the same quarter in 2001. This increase was from the sale of
turnkey drilling interests in the Sunrise-Mayel #2H. Sale of oil and gas income
this quarter was approximately the same as this same period in 2001. Other
income was $97,058 less this quarter due to distribution in 2001 from a
non-operated drilling partnership.
Costs and expenses increased $2,381,590 for the period ending September 30, 2002
compared to the same period last year. Oil and gas lease expenses were $23,572
in the third quarter of 2002 compared to $45,765 in the same quarter last year
due to less well workover expenses in 2002. Mining costs are $36,809 less this
quarter due to decreased activity on our Alaska mining claims this year. Our
project geology, geophysics, land and administration costs were $973,076 higher
in the quarter ended September 30, 2002 because of increased land acquisition
costs and geologic work over the same period last year. Cost of sales in this
quarter of $1,487,689 is the cost related to the sale of turnkey drilling
prospects.
For the quarter ended September 30, 2002 we had income of $1,071,553 compared to
a loss of $172,172 for the third quarter ended September 30, 2001. This was due
to the sale of a prospect.
Nine Months Ended Sept. 30, 2002 as compared to September 30, 2001
-----------------------------------------------------------------------------
Total revenue was $4,963,850 for the nine months ended September 20, 2002, which
is an increase of $3,301,334 compared to the same period in 2001. This increase
was due to the sale of turnkey drilling interests in several prospects. We had
a decrease of $130,752 in other income the first nine months of 2002 compared to
the same period in 2001 due to distribution in 2001 from a non-operated drilling
partnership.
We had costs and expenses of $4,516,696 for this nine-month period compared to
$1,518,228 in the same period in 2001. This increase of $2,998,468 is due to
the cost of the sale of turnkey drilling interests in prospects we sold this
first nine months. We had a decrease in oil and gas lease expense of $127,049
because of reduced workover expenses. Mining expenses were $459,374 less for
the nine months ending September 30, 2002 compared to the same period in 2001
due to reduced activity on our mining claims. We were unable to get the
necessary funding in a timely manner to enable us to perform any significant
activity. Project geology, geophysics and land costs are $1,037,310 higher this
year due to increased land acquisition and related geologic work. We had cost
of sales of $2,115,375 associated with the sale of direct working interests the
same period in 2001.
We had net income of $447,154 for the nine months ended September 30, 2002
compared to $144,288 for the same period in 2001. This is due mainly from the
profit generated from the sale of direct working interests in our drilling
projects.
Capital Resources and Liquidity
----------------------------------
Current assets are $2,496,375 at September 30, 2002 compared to $1,031,167 as of
December 31, 2001. This is due to an increase in cash from our capital
formation program Opus 1. Current liabilities are $4,064,320 for the nine
months ended September 30, 2002 compared to $3,019,610 for the period ended
December 31, 2001. This increase is due to advances from joint venture
participants in our drilling programs.
Operating Activities. We had a positive cash flow of $1,569,525 for the nine
months ended September 30, 2002 compared to a negative cash flow of $98,809 for
the same period in 2001. This change is due to funds acquired in 2002 from
joint venture participants for drilling activity. Our primary sources of
operating funds are comprised of selling prospects and oil and gas sales.
Investing Activities. In the first nine months of 2002, we spent $117,959 on
capital expenditures compared to $652,738 for the same period in 2001. These
expenditures were the result of leasing activities to acquire leases for our
drilling program. We expect to recoup these amounts as the drilling prospects
are sold to drilling programs.
Financing Activities. Net cash provided by investing activities was $8,000
compared to $51,896 for the same period in 2001. This decline was due to the
issuance of $57,000 dollars of common stock in the first nine months of 2001
compared to $8,135 this year for sales of restricted company stock in private
transactions.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
----------------------------------------------------------------
Tri-Valley Corporation does not engage in hedging activities and does not use
commodity futures or forward contracts in its cash management functions.
ITEM 4. CONTROLS AND PROCEDURES
-------------------------
As of September 30, 2002, an evaluation was performed under the supervision and
with the participation of the Company's management, including the Company's CEO
and CFO, of the effectiveness of the design and operation of the Company's
disclosure controls and procedures. Based on that evaluation, the Company's
management, including the CEO and CFO, concluded that the Company's disclosure
controls and procedures were effective as of September 30, 2002. There have
been no significant changes in the Company's internal controls or in other
factors that could significantly affect internal controls subsequent to
September 30, 2002.
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
------------------
None
ITEM 2. CHANGES IN SECURITIES
-----------------------
During the quarter ended September 30, 2002, we issued 5,000 shares of our
common stock to one ex-employee who exercised stock options in a private
transaction pursuant to the exemption contained in Section 4(2) of the
Securities Act of 1933, for aggregate consideration of $2,500. The shares
sold/issued are restricted securities, which bear a legend restricting transfer
of the shares unless registered or sold under an exemption from registration
requirements under the Securities Act.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
-------------------------------------
(a) Exhibits
None
(b) Reports on Form 8-K:
None
SIGNATURES
Pursuant to the requirement 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.
TRI-VALLEY CORPORATION
November 13, 2002 /s/ F. Lynn Blystone
------------------------
F. Lynn Blystone
President and Chief Executive Officer
November 13, 2002 /s/ Thomas J. Cunningham
---------------------------
Thomas J. Cunningham
Secretary, Treasurer, Chief Financial Officer
CIVIL CERTIFICATION
I, F. Lynn Blystone, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Tri-Valley
Corporation;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of circumstances under which such statements were
made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and
6. The registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: November 13, 2002
/s/ F. Lynn Blystone
-----------------------
Chief Executive Officer
CIVIL CERTIFICATION
I, Thomas J. Cunningham, certify that:
1. I have reviewed this quarterly report on Form 10-Q of Tri-Valley
Corporation;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of circumstances under which such statements were
made, not misleading with respect to the period covered by this quarterly
report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this quarterly report;
4. The registrants other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and we have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this quarterly report is being prepared;
b) evaluated the effectiveness of the registrants disclosure controls and
procedures as of a date within 90 days prior to the filing date of this
quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effectiveness
of the disclosure controls and procedures based on our evaluation as of the
Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based on
our most recent evaluation, to the registrant's auditors and audit committee of
registrant's board of directors (or persons performing the equivalent function):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and
6. The registrants other certifying officers and I have indicated in this
quarterly report whether or not there were significant changes in internal
controls or in other factors that could significantly affect internal controls
subsequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: November 13, 2002
/s/ Thomas J. Cunningham
---------------------------
Chief Financial Officer
CERTIFICATION
Each of the undersigned hereby certifies that this Quarterly Report on Form 10-Q
complies with the requirements of Section 13(a) or 15(d) of the Securities
Exchange Act of 1934, as amended, and the information contained in such report
fairly represents, in all material respects, the financial condition and results
of operations of the Company.
November 13, 2002 /s/ F. Lynn Blystone
------------------------
F. Lynn Blystone
President and Chief Executive Officer
November 13, 2002 /s/ Thomas J. Cunningham
---------------------------
Thomas J. Cunningham
Secretary, Treasurer, Chief Financial Officer