##### Table of Contents



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

|  |  |                                                                                        
|- |  | ---------------------------------------------------------------------------------------
|x |  | Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2002

|  |  |                                                                                         
|- |  | ----------------------------------------------------------------------------------------
|o |  | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ____ to ____

Commission File Number 0-4136

Lifecore Biomedical, Inc.

|                                                               |  |                                  
|-------------------------------------------------------------- |  | ---------------------------------
|Minnesota                                                      |  | 41-0948334                       
|                                                               |  |                                  
|(State or other jurisdiction of
incorporation or organization) |  | (IRS Employer Identification No.)
|                                                               |  |                                  
|3515 Lyman Boulevard
Chaska, Minnesota                         |  | 55318                            
|                                                               |  |                                  
|(Address of principal executive
offices)                       |  | (Zip Code)                       

Registrants telephone number, including area code: 952-368-4300

Indicate by checkmark 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 o

The number of shares outstanding of the registrants Common Stock, $.01 par
value, as of October 30, 2002 was 12,876,367 shares.

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TABLE OF CONTENTS



|                                                   |                                                                                               |                                                                                                    |  |  |  |  |  | 
|-------------------------------------------------- | --------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------- |  |  |  |  |  | 
|PART I. FINANCIAL INFORMATION                     
|                                                   | ITEM 1. FINANCIAL STATEMENTS                                                                 
|                                                   |                                                                                               | CONDENSED CONSOLIDATED BALANCE SHEETS AT SEPTEMBER 30, 2002 AND JUNE 30, 2002                     
|                                                   |                                                                                               | CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS FOR THREE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
|                                                   |                                                                                               | CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THREE MONTHS ENDED SEPTEMBER 30, 2002 AND 2001
|                                                   |                                                                                               | NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS                                              
|                                                   | ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
|                                                   | ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                           
|                                                   | ITEM 4. CONTROLS AND PROCEDURES                                                              
|PART II. OTHER INFORMATION                        
|                                                   | ITEM 6.                                                                                      
|                                                   |                                                                                               | A. EXHIBIT INDEX                                                                                  
|                                                   |                                                                                               | B. REPORTS ON FORM 8-K                                                                            
|SIGNATURES                                        
|CERTIFICATION                                     
|EX-10.1 Amendment to Credit and Security Agreement
|EX-99.1 Certification Pursuant to 18 USC Sec. 1350
|EX-99.2 Certification Pursuant to 18 USC Sec. 1350



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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES

FORM 10-Q

INDEX

|               |         |                                                                                                    |       |      |       | 
|-------------- | ------- | -------------------------------------------------------------------------------------------------- | ----- | ---- | ----- | 
|               |         |                                                                                                    |       | Page |      
|               |         |                                                                                                    |       |      |      
|Part I.        |         | Financial Information                                                                              |       |      |      
|               |         |                                                                                                    |       |     
|               | Item 1. | Financial Statements                                                                               |       |      |      
|               |         |                                                                                                    |       |     
|               |         | Condensed Consolidated Balance Sheets at
September 30, 2002 and June 30, 2002                      |       |      | 3     | 
|               |         |                                                                                                    |       |     
|               |         | Condensed Consolidated Statements of Operations for Three
Months Ended September 30, 2002 and 2001 |       |      | 4     | 
|               |         |                                                                                                    |       |     
|               |         | Condensed Consolidated Statements of Cash Flows for
Three Months Ended September 30, 2002 and 2001 |       |      | 5     | 
|               |         |                                                                                                    |       |     
|               |         | Notes to Condensed Consolidated Financial Statements                                               |       |      | 6-9   | 
|               |         |                                                                                                    |       |     
|               | Item 2. | Managements Discussion and Analysis of Results of
Operations and Financial Condition              |       |      | 10-13 | 
|               |         |                                                                                                    |       |     
|               | Item 3. | Quantitative and Qualitative Disclosures About Market Risk                                         |       |      | 14    | 
|               |         |                                                                                                    |       |     
|               | Item 4. | Controls and Procedures                                                                            |       |      | 14    | 
|               |         |                                                                                                    |       |     
|Part II.       |         | Other Information                                                                                  |       |      |       | 
|               |         |                                                                                                    |       |     
|               | Item 6. | a. Exhibit Index                                                                                   |       |      | 15    | 
|               |         | b. Reports on Form 8-K                                                                             |       |      | 15    | 
|              
|Signatures     |         |                                                                                                    | 16    |     
|              
|Certifications |         |                                                                                                    | 17-18 |     

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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

|                                     |                                             |                           |            |               |            |   |            |             |            | 
|------------------------------------ | ------------------------------------------- | ------------------------- | ---------- | ------------- | ---------- | - | ---------- | ----------- | ---------- | 
|                                     |                                             |                           |            | September 30, |            |   | June 30,   |            
|                                     |                                             |                           |            | 2002          |            |   | 2002       |            
|                                     |                                             |                           |            |               |            |   |            |            
|ASSETS                               |                                             |                           |            |               |            |   |            |            
|Current Assets                       |                                             |                           |            |               |            |   |            |            
|                                     | Cash and cash equivalents                   |                           | $          | 773,000       |            |   | $          | 2,528,000   |           
|                                     | Accounts receivable, less allowances        |                           |            | 7,551,000     |            |   |            | 7,882,000   |           
|                                     | Inventories                                 |                           |            | 12,398,000    |            |   |            | 11,810,000  |           
|                                     | Prepaid expenses                            |                           |            | 1,393,000     |            |   |            | 997,000     |           
|                                     |                                             |                           |            |               |            |   |           
|                                     |                                             | Total current assets      |            |               | 22,115,000 |   |            |             | 23,217,000 | 
|Property, plant and equipment        |                                             |                           |            |               |            |   |            |            
|                                     | Land, building and equipment                |                           |            | 44,168,000    |            |   |            | 43,988,000  |           
|                                     | Less accumulated depreciation               |                           |            | (17,848,000   | )          |   |            | (17,194,000 | )         
|                                     |                                             |                           |            |               |            |   |           
|                                     |                                             |                           | 26,320,000 |               |            |   | 26,794,000 |            
|Other Assets                         |                                             |                           |            |               |            |   |            |            
|                                     | Intangibles                                 |                           |            | 4,768,000     |            |   |            | 4,850,000   |           
|                                     | Security deposits                           |                           |            | 850,000       |            |   |            | 845,000     |           
|                                     | Inventories                                 |                           |            | 2,873,000     |            |   |            | 3,316,000   |           
|                                     | Other                                       |                           |            | 990,000       |            |   |            | 1,074,000   |           
|                                     |                                             |                           |            |               |            |   |           
|                                     |                                             |                           | 9,481,000  |               |            |   | 10,085,000 |            
|                                     |                                             |                           |            |               |            |   |           
|                                     |                                             | $                         | 57,916,000 |               |            | $ | 60,096,000 |            
|                                     |                                             |                           |            |               |            |   |           
|LIABILITIES
AND SHAREHOLDERS EQUITY |                                             |                           |            |               |            |   |            |            
|Current Liabilities                  |                                             |                           |            |               |            |   |            |            
|                                     | Current maturities of long-term obligations |                           | $          | 139,000       |            |   | $          | 139,000     |           
|                                     | Accounts payable                            |                           |            | 2,350,000     |            |   |            | 3,500,000   |           
|                                     | Accrued compensation                        |                           |            | 1,112,000     |            |   |            | 1,053,000   |           
|                                     | Accrued expenses                            |                           |            | 666,000       |            |   |            | 742,000     |           
|                                     |                                             |                           |            |               |            |   |           
|                                     |                                             | Total current liabilities |            |               | 4,267,000  |   |            |             | 5,434,000  | 
|Long-term obligations                |                                             |                           | 6,092,000  |               |            |   | 6,114,000  |            
|Shareholders equity                 |                                             |                           | 47,557,000 |               |            |   | 48,548,000 |            
|                                     |                                             |                           |            |               |            |   |           
|                                     |                                             | $                         | 57,916,000 |               |            | $ | 60,096,000 |            
|                                     |                                             |                           |            |               |            |   |           

See accompanying notes to condensed consolidated financial statements.

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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (continued)
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

|                                                                        |                            |                   |            |                                  |            |   |            |           |            |  
|----------------------------------------------------------------------- | -------------------------- | ----------------- | ---------- | -------------------------------- | ---------- | - | ---------- | --------- | ---------- | -
|                                                                        |                            |                   |            | Three months ended September 30, |           
|                                                                        |                            |                   |            |                                  |           
|                                                                        |                            |                   |            | 2002                             |            |   | 2001       |          
|                                                                        |                            |                   |            |                                  |            |   |            |          
|Net sales                                                               |                            | $                 | 8,972,000  |                                  |            | $ | 8,234,000  |          
|Cost of goods sold                                                      |                            |                   | 4,909,000  |                                  |            |   | 4,935,000  |          
|                                                                        |                            |                   |            |                                  |            |  
|                                                                        | Gross profit               |                   |            | 4,063,000                        |            |   |            | 3,299,000 |           
|                                                                       
|Operating expenses                                                     
|                                                                        | Research and development   |                   |            | 957,000                          |            |   |            | 1,636,000 |           
|                                                                        | Marketing and sales        |                   |            | 2,848,000                        |            |   |            | 2,444,000 |           
|                                                                        | General and administrative |                   |            | 1,159,000                        |            |   |            | 1,046,000 |           
|                                                                        |                            |                   |            |                                  |            |  
|                                                                        |                            |                   | 4,964,000  |                                  |            |   | 5,126,000  |          
|                                                                        |                            |                   |            |                                  |            |  
|                                                                        |                            | Operating loss    |            |                                  | (901,000   | ) |            |           | (1,827,000 | )
|                                                                       
|Other income (expense)                                                 
|                                                                        | Interest income            |                   |            | 29,000                           |            |   |            | 68,000    |           
|                                                                        | Interest expense           |                   |            | (166,000                         | )          |   |            | (170,000  | )         
|                                                                        | Other                      |                   |            | (8,000                           | )          |   |            | (3,000    | )         
|                                                                        |                            |                   |            |                                  |            |  
|                                                                        |                            |                   | (145,000   | )                                |            |   | (105,000   | )        
|                                                                        |                            |                   |            |                                  |            |  
|NET LOSS                                                                |                            | $                 | (1,046,000 | )                                |            | $ | (1,932,000 | )        
|                                                                        |                            |                   |            |                                  |            |  
|Net loss per common share                                               |                            |                   |            |                                  |            |   |            |          
|                                                                        |                            | Basic and diluted |            | $                                | (0.08      | ) |            | $         | (0.15      | )
|                                                                        |                            |                   |            |                                  |            |  
|Weighted average common and common
equivalent shares
shares outstanding |                            |                   |            |                                  |            |   |            |          
|                                                                        |                            | Basic and diluted |            |                                  | 12,874,628 |   |            |           | 12,747,618 |  
|                                                                        |                            |                   |            |                                  |            |  

See accompanying notes to condensed consolidated financial statements.

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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (continued)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

|                                                                            |                                             |                     |            |                    |            |   |            |          |           |  
|--------------------------------------------------------------------------- | ------------------------------------------- | ------------------- | ---------- | ------------------ | ---------- | - | ---------- | -------- | --------- | -
|                                                                            |                                             |                     |            | Three months ended |           
|                                                                            |                                             |                     |            | September 30,      |           
|                                                                            |                                             |                     |            |                    |           
|                                                                            |                                             |                     |            | 2002               |            |   | 2001       |         
|                                                                            |                                             |                     |            |                    |            |   |            |         
|Cash flows from operating activities:                                       |                                             |                     |            |                    |            |   |            |         
|Net loss                                                                    |                                             | $                   | (1,046,000 | )                  |            | $ | (1,932,000 | )       
|Adjustments to reconcile net loss to net cash used in
operating activities: |                                             |                     |            |                    |            |   |            |         
|                                                                            | Depreciation and amortization               |                     |            | 738,000            |            |   |            | 743,000  |          
|                                                                            | Allowance for doubtful accounts             |                     |            | (40,000            | )          |   |            |         |          
|                                                                            | Changes in operating assets and liabilities
|                                                                            |                                             | Accounts receivable |            |                    | 371,000    |   |            |          | (961,000  | )
|                                                                            |                                             | Inventories         |            |                    | (145,000   | ) |            |          | 329,000   |  
|                                                                            |                                             | Prepaid expenses    |            |                    | (396,000   | ) |            |          | (302,000  | )
|                                                                            |                                             | Accounts payable    |            |                    | (1,150,000 | ) |            |          | (283,000  | )
|                                                                            |                                             | Accrued liabilities |            |                    | (17,000    | ) |            |          | 1,040,000 |  
|                                                                            |                                             |                     |            |                    |            |  
|Net cash used in operating activities                                       |                                             |                     | (1,685,000 | )                  |            |   | (1,366,000 | )       
|                                                                           
|Cash flows from investing activities:                                       |                                             |                     |            |                    |            |   |            |         
|                                                                            | Purchases of property, plant and equipment  |                     |            | (182,000           | )          |   |            | (220,000 | )        
|                                                                            | Purchases of intangibles                    |                     |            |                   |            |   |            | (51,000  | )        
|                                                                            | Increase in security deposits               |                     |            | (5,000             | )          |   |            |         |          
|                                                                            | Decrease (increase) in other assets         |                     |            | 84,000             |            |   |            | (231,000 | )        
|                                                                            |                                             |                     |            |                    |            |  
|Net cash used in investing activities                                       |                                             |                     | (103,000   | )                  |            |   | (502,000   | )       
|                                                                           
|Cash flows from financing activities:                                       |                                             |                     |            |                    |            |   |            |         
|                                                                            | Payments on long-term obligations           |                     |            | (22,000            | )          |   |            | (30,000  | )        
|                                                                            | Proceeds from stock issuance                |                     |            | 55,000             |            |   |            | 92,000   |          
|                                                                            |                                             |                     |            |                    |            |  
|Net cash provided by financing activities                                   |                                             |                     | 33,000     |                    |            |   | 62,000     |         
|                                                                            |                                             |                     |            |                    |            |  
|Net decrease in cash and cash equivalents                                   |                                             |                     | (1,755,000 | )                  |            |   | (1,806,000 | )       
|Cash and cash equivalents at beginning of period                            |                                             |                     | 2,528,000  |                    |            |   | 2,310,000  |         
|                                                                            |                                             |                     |            |                    |            |  
|Cash and cash equivalents at end of period                                  |                                             | $                   | 773,000    |                    |            | $ | 504,000    |         
|                                                                            |                                             |                     |            |                    |            |  
|Supplemental disclosure of cash flow information:                           |                                             |                     |            |                    |            |   |            |         
|                                                                            | Cash paid during the period for:            |                     |            |                    |            |   |            |          |          
|                                                                            |                                             | Interest            |            | $                  | 123,000    |   |            | $        | 166,000   |  

See accompanying notes to condensed consolidated financial statements.

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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (continued)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2002

NOTE A  FINANCIAL INFORMATION

Lifecore Biomedical, Inc. (the Company) develops, manufactures and markets
biomaterials and medical devices for use in various surgical markets through
two divisions, the Hyaluronan Division and the Oral Restorative Division. The
Companys manufacturing facility is located in Chaska, Minnesota. The
Hyaluronan Division conducts its business through OEM and contract
manufacturing alliances in the gynecologic and ophthalmologic surgery,
veterinary, and wound management fields. The Oral Restorative Division conducts
its business through direct sales and marketing in the United States, Germany,
Italy and Sweden and through 22 distributors in 35 foreign countries.

The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with Regulation S-X pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with accounting principles generally accepted in the United States
of America have been condensed or omitted pursuant to such rules and
regulations, although management believes that the disclosures are adequate to
make the information presented not misleading.

In the opinion of management, the unaudited condensed consolidated financial
statements contain all adjustments (consisting of only normal recurring
adjustments) necessary to present fairly the financial position as of September
30, 2002, and the results of operations and cash flows for the three month
periods ended September 30, 2002 and 2001. The results of operations for the
three months ended September 30, 2002 are not necessarily indicative of the
results for the full year or of the results for any future periods. The
unaudited condensed consolidated balance sheet as of June 30, 2002 has been
derived from audited financial statements as of that date.

In preparation of the Companys consolidated financial statements, management
is required to make estimates and assumptions that affect reported amounts of
assets and liabilities and related revenues and expenses during the reporting
periods. Actual results could differ from the estimates used by management.

NOTE B  INVENTORIES

Inventories are stated at the lower of cost (first-in, first-out method) or
market. Inventories not expected to be consumed within one year are classified
as a long-term asset. Finished good inventories include hyaluronan, packaged
aseptic, and oral restorative products. Inventories consist of the following:

|                 |  |               |            |  |          |   |            | 
|---------------- |  | ------------- | ---------- |  | -------- | - | ---------- | 
|                 |  | September 30, |            |  | June 30, |  
|                 |  | 2002          |            |  | 2002     |  
|                 |  |               |            |  |          |  
|                 |  | (Unaudited)   |           
|Raw materials    |  | $             | 3,296,000  |  |          | $ | 2,902,000  | 
|Work in progress |  |               | 318,000    |  |          |   | 272,000    | 
|Finished goods   |  |               | 11,657,000 |  |          |   | 11,952,000 | 
|                 |  |               |            |  |          |  
|                 |  | $             | 15,271,000 |  |          | $ | 15,126,000 | 
|                 |  |               |            |  |          |  

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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (continued)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (cont.)

September 30, 2002

NOTE C  INTANGIBLE ASSETS

Effective July 1, 2001, the Company adopted Financial Accounting Standards
Board (FASB) Statement of Financial Accounting Standard (SFAS) No. 142,
Goodwill and Other Intangible Assets. Under the provisions of SFAS No. 142
the Company ceased amortization of goodwill and technology and regulatory
rights effective July 1, 2001, while the customer list continues to be
amortized on the straight-line method over 5 years. On an ongoing basis the
Company reviews the valuation of intangibles to determine possible impairment
by comparing the carrying value to projected undiscounted future cash flows of
the related assets. As a result, a $40,000 impairment was recorded in the
quarter ended September 30, 2002.

Intangibles consisted of the following:

|                         |  |               |            |   |          |   |            |  
|------------------------ |  | ------------- | ---------- | - | -------- | - | ---------- | -
|                         |  | September 30, |            |   | June 30, |  
|                         |  | 2002          |            |   | 2002     |  
|                         |  |               |            |   |          |  
|Goodwill                 |  | $             | 8,245,000  |   |          | $ | 8,245,000  |  
|Customer list            |  |               | 725,000    |   |          |   | 725,000    |  
|Patents                  |  |               | 387,000    |   |          |   | 387,000    |  
|Accumulated amortization |  |               | (4,589,000 | ) |          |   | (4,507,000 | )
|                         |  |               |            |   |          |  
|                         |  | $             | 4,768,000  |   |          | $ | 4,850,000  |  
|                         |  |               |            |   |          |  

NOTE D  AGREEMENTS

Lifecore and ETHICON have entered into a Conveyance, License, Development and
Supply Agreement (the ETHICON Agreement).

Under the terms of the ETHICON Agreement, ETHICON transferred to Lifecore its
ownership in certain technology related to research and development previously
conducted on the Companys sodium hyaluronan material. The technology
transferred to Lifecore includes written technical documents related to
ETHICONs research and development of a product to inhibit the formation of
postsurgical adhesions. These documents include product specifications, methods
and techniques, technology, know-how and certain patents.. Lifecore assumed
responsibility for continuing the anti-adhesion development project including
conducting a human gynecology clinical trial on INTERGEL Solution, a
second-generation hyaluronan-based product. Lifecore has granted ETHICON
exclusive worldwide marketing rights through 2008 to the products developed by
Lifecore within defined fields of use.

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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (continued)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (cont.)

September 30, 2002

NOTE E  LINE OF CREDIT

The Company has an agreement with a bank for a $5,000,000 line of credit. The
agreement allows for advances against eligible accounts receivable and
inventories, subject to a borrowing base certificate. Interest is accrued at
the prime rate plus 1% at September 30, 2002 and June 30, 2002, which was
5.75%. The agreement, as amended, has a maturity date of December 31, 2002. At
September 30, 2002 and June 30, 2002, there were no balances outstanding under
this line of credit. The terms of the agreement require the Company to comply
with various financial covenants including minimum tangible net worth, capital
expenditure limitations, liabilities to tangible net worth ratio, minimum
EBITDA and minimum working capital amounts. At September 30, 2002 the Company
was not in compliance with the minimum tangible net worth covenant and has
obtained a waiver of this covenant violation from the bank as set forth in
Exhibit 10.1.

NOTE F  NET LOSS PER SHARE

The Companys basic net loss per share amounts have been computed by dividing
net loss by the weighted average number of outstanding common shares. The
Companys diluted net loss per share is computed by dividing net loss by the
weighted average number of outstanding common shares and common share
equivalents relating to stock options, when dilutive. For the three months
ended September 30, 2002 and 2001 the Company reported a net loss and as such,
no common share equivalents were included in the computation of diluted net
loss per share. However, if the Company would have reported net income in the
three months ended September 30, 2002 and 2001, 153,830, and 55,563 common
share equivalents would have been included in the computation of diluted net
income per share, respectively.

Options to purchase 1,887,168 shares of common stock with a weighted average
exercise price of $14.30 for the three-month period ended September 30, 2002
and options to purchase 2,498,687 shares of common stock with a weighted
average exercise price of $12.65 for the three-month period ended September 30,
2001, respectively, were outstanding but were not included in the calculation
of diluted net loss per share because the options exercise prices were greater
than the average market price of the Companys common stock during those
periods. Although these options were antidilutive for the periods presented,
they may be dilutive in future periods.

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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS (continued)
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (cont.)

September 30, 2002

NOTE G  SEGMENT INFORMATION

The Company operates two business segments. The Hyaluronan Division develops,
manufactures, and markets products containing hyaluronan. The Oral Restorative
Division develops, manufactures and/or markets various oral restorative
products to the area of implant dentistry. Currently, products containing
hyaluronan are sold primarily to customers pursuant to ongoing supply
agreements. The Companys Oral Restorative Division markets products directly
to clinicians and dental laboratories in the United States, Germany, Italy and
Sweden and primarily through distributorship arrangements in other foreign
locations. The operations of the Companys subsidiaries, Lifecore Biomedical
GmbH, Lifecore Biomedical SpA, and Lifecore Biomedical AB have not been
material to the consolidated financial statements.

Segment assets and the basis of segmentation are consistent with that reported
at June 30, 2002. Segment information for sales and loss from operations are as
follows:

|                     |                           |   |                                  |           |   |      |            |            |  
|-------------------- | ------------------------- | - | -------------------------------- | --------- | - | ---- | ---------- | ---------- | -
|                     |                           |   | Three months ended September 30, |          
|                     |                           |   |                                  |          
|                     |                           |   | 2002                             |           |   | 2001 |           
|                     |                           |   |                                  |           |   |      |           
|Net sales            |                           |   |                                  |           |   |      |            |           
|                     | Hyaluronan products       |   | $                                | 3,698,000 |   |      | $          | 3,028,000  |  
|                     | Oral restorative products |   |                                  | 5,274,000 |   |      |            | 5,206,000  |  
|                     |                           |   |                                  |           |   |      |           
|                     |                           | $ | 8,972,000                        |           |   | $    | 8,234,000  |           
|                     |                           |   |                                  |           |   |      |           
|Loss from operations |                           |   |                                  |           |   |      |            |           
|                     | Hyaluronan products       |   | $                                | (435,000  | ) |      | $          | (1,564,000 | )
|                     | Oral restorative products |   |                                  | (466,000  | ) |      |            | (263,000   | )
|                     |                           |   |                                  |           |   |      |           
|                     |                           | $ | (901,000                         | )         |   | $    | (1,827,000 | )         
|                     |                           |   |                                  |           |   |      |           

9



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##### Table of Contents






LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION

Critical Accounting Policies:

The discussion and analysis of our financial condition and results of
operations are based upon our consolidated financial statements, which have
been prepared in accordance with accounting principles generally accepted in
the United States of America (US GAAP). The preparation of these financial
statements requires management to make estimates and assumptions in certain
circumstances that affect the reported amount of assets and liabilities,
revenues and expenses, and related disclosure of contingent assets and
liabilities at the date of our financial statements. Management bases its
estimates and judgments on historical experience, observance of trends in the
industry, information provided by customers and other outside sources and on
various other factors that are believed to be reasonable under the
circumstances. Actual results may differ from these estimates under different
assumptions or conditions.

Revenue Recognition:

The Companys revenues are recognized when products are shipped to or otherwise
accepted by unaffiliated customers. The Securities and Exchange Commissions
Staff Accounting Bulletin (SAB) No. 101, Revenue Recognition provides
guidance on the application of US GAAP to selected revenue recognition issues.
The Company has concluded that its revenue recognition policy is appropriate
and in accordance with US GAAP and SAB No. 101.

Allowance for Uncollectible Accounts Receivable:

Accounts receivable are reduced by an allowance for amounts that may become
uncollectible in the future. The Company extends credit to customers in the
normal course of business, but generally does not require collateral or any
other security to support amounts due. Management performs on-going credit
evaluations of its customers and bases the estimated allowance on these
evaluations.

Inventories:

Inventories are stated at the lower of cost (first-in, first-out method) or
market and have been reduced by an allowance for obsolete, excess or
unmarketable inventory. The estimated allowance is based on managements review
of inventories on-hand compared to estimated future usage and sales.

Goodwill, Intangible and Other Long-Lived Assets:

Intangible and certain other long-lived assets with a definite life are
amortized over their useful lives. Useful lives are based on managements
estimates of the period that the assets will generate revenue.

In July 2001, the Financial Accounting Standards Board issued SFAS 142 which
deals with, among other things, amortization of goodwill. The Company adopted
this new standard effective July 1, 2001 and ceased amortization of goodwill at
that date and reviews goodwill for impairment on a regular basis, at least
annually.

Management has reviewed goodwill and other intangibles for impairment and has
concluded that such assets are appropriately valued at the financial statement
dates.

10



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##### Table of Contents



LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION (cont.)

Results of Operations

Three Months Ended September 30, 2002 Compared to Three Months Ended September
30, 2001:

|                   |                            |   |            |         |  |                  |            |           |      |   |           |           |  |   |           |           | 
|------------------ | -------------------------- | - | ---------- | ------- |  | ---------------- | ---------- | --------- | ---- | - | --------- | --------- |  | - | --------- | --------- | 
|                   |                            |   | Hyaluronan |         |  | Oral Restorative |           
|                   |                            |   | Division   |         |  | Division         |           
|                   |                            |   |            |         |  |                  |           
|                   |                            |   | 2002       |         |  | 2001             |            |           | 2002 |   |           | 2001      | 
|                   |                            |   |            |         |  |                  |            |           |      |   |           |           | 
|Net sales          |                            | $ | 3,698,000  |         |  | $                | 3,028,000  |           |      | $ | 5,274,000 |           |  | $ | 5,206,000 |          
|Cost of goods sold |                            |   | 2,799,000  |         |  |                  | 2,697,000  |           |      |   | 2,110,000 |           |  |   | 2,238,000 |          
|                   |                            |   |            |         |  |                  |            |           |      |   |           |          
|Gross profit       |                            |   | 899,000    |         |  |                  | 331,000    |           |      |   | 3,164,000 |           |  |   | 2,968,000 |          
|                  
|Operating expenses
|                   | Research and development   |   |            | 709,000 |  |                  |            | 1,433,000 |      |   |           | 248,000   |  |   |           | 203,000   | 
|                   | Marketing and sales        |   |            | 174,000 |  |                  |            | 62,000    |      |   |           | 2,674,000 |  |   |           | 2,382,000 | 
|                   | General and administrative |   |            | 451,000 |  |                  |            | 400,000   |      |   |           | 708,000   |  |   |           | 646,000   | 
|                   |                            |   |            |         |  |                  |            |           |      |   |           |          
|                   |                            |   | 1,334,000  |         |  |                  | 1,895,000  |           |      |   | 3,630,000 |           |  |   | 3,231,000 |          
|                   |                            |   |            |         |  |                  |            |           |      |   |           |          
|Operating loss     |                            | $ | (435,000   | )       |  | $                | (1,564,000 | )         |      | $ | (466,000  | )         |  | $ | (263,000  | )        
|                   |                            |   |            |         |  |                  |            |           |      |   |           |          

Net sales for the quarter ended September 30, 2002 increased $738,000 or 9% as
compared to the same quarter of last fiscal year. Hyaluronan product sales for
the current quarter increased $670,000 or 22% as compared to the same quarter
of last fiscal year. The sales increase was due to increased sales of
gynecologic and orthopedic products, partially offset by reduced ophthalmic
hyaluronan shipments. Oral restorative product sales for the current quarter
increased $68,000 or 1% compared to the same quarter of last fiscal year.
International sales of oral restorative products increased $291,000 or 14%,
principally from increased sales in Germany, while Domestic sales of oral
restorative products decreased $223,000 or 7% as compared to the same quarter
of last fiscal year.

Consolidated gross margin increased to 45% for the current quarter from 40% for
the same quarter of last fiscal year. The gross margin for the Hyaluronan
Division increased to 24% from a gross margin of 11% due to absorption of
excess capacity costs associated with increased hyaluronan production. The
gross margin for the Oral Restorative Division increased to 60% for the current
quarter from 57% for the same quarter of last fiscal year. The gross margin
increase is attributed to a sales mix more weighted to higher margin sales and
reduced material costs for the current quarter as compared to the same quarter
of the prior year.

Research and development expenses decreased $679,000 or 42% in the current
quarter as compared to the same quarter of last fiscal year. The decrease is
due to the decline in consulting and professional fees related to the
regulatory review process of GYNECARE INTERGEL Adhesion Prevention Solution.
The Company received FDA approval to market this product in the United States
in November 2001.

Marketing and sales expenses increased $404,000 or 17% in the current quarter
as compared to the same quarter of last fiscal year due to an increase in
marketing expenses and costs associated with international expansion.

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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION (cont.)

General and administrative expenses increased $113,000 or 11% for the current
quarter as compared to the same quarter of last fiscal year. The increase
resulted from higher personnel related expenses, primarily associated with
international expansion.

Net other expense increased $40,000 or 38% for the current quarter as compared
to the same quarter of last fiscal year. Interest income decreased $39,000 due
to a lower average amount of cash to invest than in the same quarter of last
fiscal year combined with a lower rate of return.

Liquidity and Capital Resources

The Companys Annual Report on Form 10-K for the year ended June 30, 2002
contains a detailed discussion of Lifecores liquidity and capital resources.
In conjunction with this Quarterly Report on Form 10-Q, investors should read
the 2002 Form 10-K.

For the three month period ended September 30, 2002, the Company had negative
cash flow from operations of $1,685,000, while cash flow from operations was
positive in fiscal years 2002, 2001 and 2000. Charges for unused capacity
associated with the Companys hyaluronan production and additional costs
associated with the regulatory review process for INTERGEL Solution have
negatively impacted operating results in the current fiscal year, as well as in
fiscal 2002, 2001 and 2000. Charges for unused capacity are a result of an
unanticipated delay in receiving INTERGEL Solution marketing approval in the
U.S. from the FDA. As the Hyaluronan Divisions production levels increase, its
related production efficiencies will increase and charges for unused capacity
will decrease. Also, marketing and sales expenses for the oral restorative
products are expected to continue at a high level with continued international
expansion and increased personnel costs.

The loan agreement between the Company and the holder of the industrial
development revenue bonds issued to finance the Companys Chaska, Minnesota
facility was amended in June 2002 to waive the fixed charge coverage ratio and
the cash flow coverage ratio through June 30, 2003. With respect to certain of
these covenants, the Company may be required to obtain further waivers for
fiscal 2004. There can be no assurance that future waivers will be granted to
the Company.

The Company has an agreement with a bank for a $5,000,000 line of credit. The
agreement allows for advances against eligible accounts receivable and
inventories, subject to a borrowing base certificate. Interest is accrued at
the prime rate plus 1% at September 30, 2002 and June 30, 2002, which was
5.75%. At September 30, 2002 and June 30, 2002, there were no balances
outstanding under this line of credit. The terms of the agreement require the
Company to comply with various financial covenants including minimum tangible
net worth, capital expenditure limitations, liabilities to tangible net worth
ratio, minimum EBITDA and minimum working capital amounts. At September 30,
2002 the Company was not in compliance with the minimum tangible net worth
covenant and has obtained a waiver of this covenant violation from the bank as
set forth in Exhibit 10.1. The agreement, as amended, has a maturity date of
December 31, 2002. It is the intention of the Company to either renew the
existing line of credit agreement or seek a comparable line of credit agreement
with a different bank. There is no assurance that the Company will be able to
renew the existing line of credit agreement or be able to secure a line of
credit agreement with a different bank when the current agreement expires on
December 31, 2002.

The Company expects to finance its future business operations with cash
generated from anticipated operations and the availability of the line of
credit. No assurance can be given that the Company will achieve positive cash
flow from operations. The Companys ability to generate positive cash flow
from operations and achieve profitability is dependent upon the continued
expansion of revenue from its hyaluronan and oral restorative businesses.
Growth in the Hyaluronan Division is unpredictable due to the complex
governmental regulatory environment for new medical

12



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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION (cont.)

products and to the uncertainty of product acceptance within the medical
community. Similarly, expansion of the Companys Oral Restorative Division
sales is also dependent upon increased revenue from new and existing customers,
as well as successfully competing in a more mature market. While the Companys
capital resources appear adequate today, the Company may need additional
financing in the future. If additional financing is necessary, no assurance
can be given that such financing will be available and, if available, will be
on terms favorable to the Company and its shareholders.

Cautionary Statement

Certain statements in this Form 10-Q are forward-looking statements as defined
in the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements, which include statements relating to anticipated regulatory
outcomes, continued financial improvement, adequate cash flow, access to
financial markets, increased production levels, the successful market
acceptance of INTERGEL Solution in the U.S., the reduction of research and
development expenses related to the INTERGEL Solution regulatory review
process, the negative impact on Hyaluronan Division margins from the unused
capacity, and the future marketing and sales success of Oral Restorative
Division products, are subject to change. These statements are subject to
certain risks and uncertainties that could cause actual results to differ
materially from historical results and those presently anticipated or
projected, such as, unforeseen difficulties or delays in interactions with the
FDA, and lack of cooperation or marketing success from marketing partners for
the hyaluronan products. Investors are referred to a more detailed discussion
of those risks presented in Managements Discussion and Analysis of Financial
Condition and Results of Operations section in the Companys Annual Report on
Form 10-K for the year ended June 30, 2002 as well as Exhibit 99.1 to such Form
10K.

GYNECARE INTERGEL Adhesion Prevention Solution, GYNECARE, and ETHICON, INC. are
registered trademarks of ETHICON, INC.

13



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LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART I  FINANCIAL INFORMATION



| |  | ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
| |  | ------------------------------------------------------------------

The Company invests its excess cash in money market mutual funds and highly
rated corporate debt securities. All investments are held-to-maturity. The
market risk on such investments is minimal.

Receivables from sales to foreign customers are denominated in U.S. Dollars.
Transactions at the Companys foreign subsidiaries are denominated in European
Euros at Lifecore Biomedical SpA and Lifecore Biomedical GmbH and are
denominated in Swedish Krona at Lifecore Biomedical AB. The Company has
historically had minimal exposure to changes in foreign currency exchange
rates, and as such, has not used derivative financial instruments to manage
foreign currency fluctuation risk.

The Companys outstanding long-term debt carries interest at a fixed rate.
There is no material market risk relating to the Companys long-term debt.






| |  | ITEM 4. CONTROLS AND PROCEDURES
| |  | -------------------------------

(a)  Evaluation of disclosure controls and procedures.

Under the supervision and with the participation of our management, including
the Companys Chief Executive Officer and Chief Financial Officer, we evaluated
the effectiveness of the design and operation of our disclosure controls and
procedures (as defined in Rule 13a  14(c) under the Exchange Act) as of a date
(the Evaluation Date) within 90 days prior to the filing date of this report.
Based upon that evaluation, the Chief Executive Officer and Chief Financial
Officer concluded that, as of the Evaluation Date, our disclosure controls and
procedures are effective in timely alerting them to the material information
relating to us (or our consolidated subsidiaries) required to be included in
our periodic SEC filings.

(b)  Changes in internal controls.

There were no significant changes made in our internal controls during the
period covered by this report or, to our knowledge, in other factors that could
significantly affect these controls subsequent to the date of their evaluation.

14



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##### Table of Contents















LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART II  OTHER INFORMATION

Item 6. Exhibits and Reports on
Form 8-K



| | a. |  | Exhibits and Exhibit Index
| | -- |  | --------------------------

|     |  |                                                                                                                                                                                                                                                                                                                             
|---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1  |  | Restated Articles of Incorporation, as amended (incorporated
by reference to Exhibit 19(a) to Amendment No. 1 on Form 8,
dated July 13, 1988, to Form 10-Q for the quarter ended
December 31, 1987), as amended by Amendment No. 2,
(incorporated by reference to Exhibit 3.1 to Form 10-K for
the year ended June 30, 1997)
|    
|3.2  |  | Amended Bylaws, (incorporated by reference to Exhibit 3.2 to
Form 10-K/A for the year ended June 30, 1995)                                                                                                                                                                                                                  
|    
|3.3  |  | Form of Rights Agreement, dated as of May 23, 1996, between
the Company and Norwest Bank Minnesota, National Association
(incorporated by reference to Exhibit 1 to the Companys
Form 8-A Registration Statement dated May 31, 1996)                                                                                       
|    
|4.1  |  | Form of Common Stock Certificate (incorporated by reference
to Exhibit 4.1 to 1987 S-2 Registration Statement [File No.
33-12970])                                                                                                                                                                                          
|    
|10.1 |  | Amendment No. 5 to Credit and Security Agreement dated
November 7, 2002 between U.S. Bank National Association and
the Company, filed herewith                                                                                                                                                                              
|    
|99.1 |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                      
|    
|99.2 |  | Certification pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to section 906 of the Sarbanes-Oxley Act of 2002                                                                                                                                                                                                      



| | b. |  | Reports on Form 8-K
| | -- |  | -------------------
|
| |    |  | None               

15



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##### Table of Contents



LIFECORE BIOMEDICAL, INC. AND SUBSIDIARIES
PART II  OTHER INFORMATION




SIGNATURES

Pursuant to the requirements 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.

|       |                   |  |  |                                                                                                                            
|------ | ----------------- |  |  | ---------------------------------------------------------------------------------------------------------------------------
|       |                   |  |  | LIFECORE BIOMEDICAL, INC.                                                                                                  
|      
|Dated: | November 12, 2002 |  |  | /s/ James W. BrackeJames W. Bracke
President & Chief Executive Officer                                                     
|      
|Dated: | November 12, 2002 |  |  | /s/ Dennis J. AllinghamDennis J. Allingham
Executive Vice President
& Chief Financial Officer
(Principal Financial Officer)

16



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##### Table of Contents



CERTIFICATION

Chief Executive Officer



|   |  | I, James W. Bracke, Ph.D., certify that:                                                                                                                                                                                                                                                                                     
|-- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|1. |  | I have reviewed this quarterly report on Form 10-Q report of Lifecore
Biomedical, Inc.;                                                                                                                                                                                                                                      
|  
|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 the circumstances under which such
statements were made, not misleading with respect to the period covered by
this Form 10Q report;
|  
|3. |  | Based on my knowledge, the financial statements, and other financial
information included in this Form 10Q 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 registrants other certifying officer 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:                                                                                                     



| |  |  | 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;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | evaluated the effectiveness of the registrants disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the Evaluation Date); and                                                                                                  
|
| |  |  | 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 officer and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | 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
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | 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 registrants other certifying officer 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.
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                         |  |                                                      
|------------------------ |  | -----------------------------------------------------
|Dated: November 12, 2002 |  | By        /s/ JAMES W. BRACKE                        
|                         |  | James W. Bracke, Ph.D.                               
|                         |  | President, Chief Executive Officer                   
|                         |  | (principal executive officer), Secretary and Director

17



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##### Table of Contents






CERTIFICATION

Chief Financial Officer



|   |  | I, Dennis J. Allingham, certify that:                                                                                                                                                                                                                                                                                         
|-- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  
|1. |  | I have reviewed this quarterly report on Form 10-Q report of Lifecore
Biomedical, Inc.;                                                                                                                                                                                                                                       
|  
|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 the 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 Form 10Q 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 registrants other certifying officer 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:                                                                                                      



| |  |  | 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;
| | - |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | evaluated the effectiveness of the registrants disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the Evaluation Date); and                                                                                                  
|
| |  |  | 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 officer and I have disclosed, based on
our most recent evaluation, to the registrants auditors and the audit
committee of registrants board of directors (or persons performing the
equivalent function):
|-- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| |  |  | 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
| | - |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |  |  | 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 registrants other certifying officer 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.
|-- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                         |  |                                                                                   
|------------------------ |  | ----------------------------------------------------------------------------------
|Dated: November 12, 2002 |  | By  /s/ DENNIS J. ALLINGHAMDennis J. Allingham                                    
|                         |  | Executive Vice President and Chief
Financial Officer
(principal financial officer)

18