Securities and Exchange Commission

                             Washington, D.C. 20549

                                   Form 10-QSB

    [X] Quarterly Report Pursuant to Section 13 or 15 (D) of the Securities
                              Exchange Act of 1934

                        For Quarter Ended March 31, 2004

                                       Or

    [ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
               Exchange Act of 1934 For the Transition Period from

                               ________ to _______

                        Commission file number 33-948884

                           Coates International, Ltd.
             (Exact Name of Registrant as Specified in its Charter)

                               Delaware 22-2925432
                (State or other Jurisdiction of (I.R.S. Employer

               Incorporation or Organization) Identification No.)

          Highway 34 & Ridgewood Road, Wall Township, New Jersey 07719
               (Address of Principal Executive Office) (Zip Code)

                                 (732) 449-7717
              (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 [ ]

As of March 31, 2004, there were 265,273,192  shares of the Registrant's  common
stock were issued and outstanding.


<PAGE>


                           COATES INTERNATIONAL, LTD.

                                      INDEX
                                    ---------


                                                                          Page
                                                                         Number
                                                                         ------

PART  1  -  FINANCIAL INFORMATION

Item 1   Financial Statements (unaudited)

         Condensed Balance Sheet
          - March 31, 2004                                                  2

         Condensed Statements of Operations

          - Three months ended March 31, 2004 and 2003                      3

         Condensed Statements of Cash Flows

          - Three months ended March 31, 2004 and 2003                      4

         Notes to Condensed Financial Statements                            5

Item 2   Management's Discussion and Analysis of Financial Condition
             and Results of Operations                                    6-9

Item 3   Controls and

Procedures                                                                  9

PART II  -  OTHER INFORMATION                                               9

Item 1.     LEGAL PROCEEDINGS                                               9

Item 2.     CHANGES IN SECURITIES                                           9


Item 3.     DEFAULTS ON SENIOR SECURITIES                                   9


Item 4.     SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS            10

Item 5.     OTHER INFORMATION                                              10

Item 6.     EXHIBITS AND REPORTS ON FORM 8-K                               10

SIGNATURES                                                                 11


                                       1
<PAGE>

                           COATES INTERNATIONAL, LTD.
                        INDEX TO THE FINANCIAL STATEMENTS
                                 MARCH 31, 2004

                                                                           Page

Independent Accountants' Report  ....................................         1

Financial Statements

     Condensed Balance Sheet.........................................         2

     Condensed Statements of Operations..............................         3

     Condensed Statements of Cash Flows..............................         4

     Notes to the Condensed Financial Statements.....................         5



                                       2
<PAGE>

                           COATES INTERNATIONAL, LTD.
                             CONDENSED BALANCE SHEET
                                 MARCH 31, 2004
                                   (UNAUDITED)

<TABLE>
<CAPTION>
<S>                                                                             <C>
      Assets
Current Assets
   Cash                                                                         $     76,603
   Inventory                                                                         302,706
   Due from Coates Motorcycle Company, Ltd.                                           77,050
                                                                                ------------
                                                                                     456,359

      Total Current Assets

Property, Plant and Equipment - Net of accumulated depreciation of $605,747        1,602,032

Other Assets
   Investment                                                                             --
   Deposits                                                                            2,500
                                                                                ------------

      Total Assets                                                                 2,060,891
                                                                                ============

      Liabilities and Stockholders' Equity

Current Liabilities
   Current portion of mortgage payable                                                 4,770
   Accounts payable                                                                   48,598
   Accrued interest payable                                                           12,076
   Accrued expenses                                                                  803,017
   License deposits                                                                  940,000
                                                                                ------------

        Total Current Liabilities                                                  1,808,461

   Mortgage payable, net of current portion                                          865,124
                                                                                ------------

        Total Liabilities                                                          2,673,585

Stockholders' Equity (Deficit)
    Common stock, $.00001 par value, 1,000,000,000 shares authorized,                  2,655
       265,093,440 shares issued and outstanding
    Additional paid-in capital                                                    16,210,189
      Retained earnings (deficit)                                                (16,825,538)
                                                                                ------------

        Total Stockholders' Equity (Deficit)                                        (612,694)
                                                                                ------------

        Total Liabilities and Stockholders' Equity (Deficit)                    $  2,060,891
                                                                                ============
</TABLE>

See notes to the condensed financial statements.



                                       3
<PAGE>

                           COATES INTERNATIONAL, LTD.
                       CONDENSED STATEMENTS OF OPERATIONS



<TABLE>
<CAPTION>
                                                              Three Months Ended
                                                                    March 31,
                                                         --------------------------------
                                                             2004                2003
                                                         -------------      -------------
                                                          (Unaudited)        (Unaudited)
                                                         -------------      -------------
<S>                                                      <C>                <C>
Revenue                                                  $          --      $          --
                                                         -------------      -------------

Operating Expenses:

   Research and development costs                               17,978             21,791
   Research and development costs - related party               22,000             41,000
   General and administrative expenses                         249,216            314,300
   Depreciation and amortization expense                        19,058             15,815
                                                         -------------      -------------

      Total Operating Expenses                                 308,252            392,906
                                                         -------------      -------------

   Loss From Operations                                       (308,252)          (392,906)

Other Income (Expense):

   Interest income                                                 209              1,298
   Interest expense                                            (32,295)           (38,761)
                                                         -------------      -------------
                                                               (32,086)           (37,463)
      Total Other Income (Expense)

                                                         -------------      -------------
                                                              (340,338)          (430,369)
Net Loss Before Income Taxes

Provision for Income Taxes                                          --                 --
                                                         -------------      -------------
Net Loss                                                 $    (340,338)     $    (430,369)
                                                         =============      =============
Loss Per Share                                           $        0.00      $        0.00
                                                         =============      =============

Weighted Average Number of Common Shares Outstanding       265,591,992        265,082,050
                                                         =============      =============
</TABLE>



See notes to the condensed financial statements.



                                       4
<PAGE>

                           COATES INTERNATIONAL, LTD.
                       CONDENSED STATEMENTS OF CASH FLOWS

                                                   Three Months Ended
                                                        March 31,
                                              ----------------------------
                                                 2004             2003
                                              (Unaudited)      (Unaudited)
                                              -----------      -----------

Cash Flow From Operating Activities           $  (489,359)     $  (498,855)

Cash Flow From Investing Activities                    --               --

Cash Flow From Financing Activities
    Repayment of mortgage                          (1,250)          (2,014)
                                              -----------      -----------
    Net Cash Used in Financing Activities          (1,250)          (2,014)


                                              -----------      -----------

    Net (Decrease) in Cash                       (490,609)        (500,869)

    Cash - Beginning of Period                    567,212        1,079,267
                                              -----------      -----------
    Cash - End of Period                      $    76,603      $   578,398
                                              ===========      ===========






See notes to the condensed financial statements.



                                       5
<PAGE>

                           COATES INTERNATIONAL, LTD.
                   NOTES TO THE CONDENSED FINANCIAL STATEMENTS

  BASIS OF PRESENTATION

The accompanying  unaudited condensed financial statements have been prepared in
accordance with generally accepted  accounting  principles for interim financial
information   and  with  the   instructions  to  Item  310  of  Regulation  S-B.
Accordingly,  they do not include all of the information and footnotes  required
by generally accepted accounting  principles for complete financial  statements.
In the opinion of management,  all adjustments  (consisting of normal  recurring
accruals)  considered  necessary  for a fair  presentation  have been  included.
Operating  results  for the three  months  ended March 31, 2004 and 2003 are not
necessarily  indicative  of the results that may be expected for the years ended
December 31, 2004 and 2003. The unaudited condensed financial  statements should
be read in conjunction with the consolidated  financial statements and footnotes
thereto  included  in the  Company's  annual  report on Form 10-KSB for the year
ended December 31, 2003.

  INVESTMENT

    On April 30, 2003,  the Company  entered into a  sublicense  agreement  with
    Coates Motorcycle  Company,  Ltd. Prior to the agreement,  Coates Motorcycle
    Company,  Ltd. was owned 100% by Gregory Coates,  an officer of the Company.
    Pursuant to the agreement, the Company granted certain exclusive licenses in
    exchange  for  approximately  51% of  common  shares  of  Coates  Motorcycle
    Company, Ltd. In addition, the Company had an anti-dilution right.

    During the quarter  ended March 31,  2004,  the Company  amended its license
    agreement with Coates Motorcycle Company,  Ltd. to expand the license rights
    granted,  and  remove  the  anti-dilution   provision  in  exchange  for  an
    additional 1,000,000 common shares of Coates Motorcycle Company, Ltd.

    Due to Coates  Motorcycle  Company,  Ltd. issuing its common shares to other
    parties  and the  removal  of the  anti-dilution  provision,  the  Company's
    ownership of Coates Motorcycle Company, Ltd. as of March 31, 2004 is 29.5%.

    The  Company's  investment  in  Coates  Motorcycle  Company,  Ltd.  is being
    accounted  for under the equity  method of accounting  for  investments,  as
    such,  the  investment is being carried at cost,  adjusted for the Company's
    proportionate share of their undistributed earnings or losses.


                                       6
<PAGE>

Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF

  FINANCIAL CONDITION AND RESULTS OF OPERATIONS

         Except  for  historical  information,  the  Company's  reports  to  the
         Securities  and Exchange  Commission on Form 10-QSB and Form 10-QSB and
         periodic  press  releases,  as  well  as  other  public  documents  and
         statements,  contain "forward-looking statements" within the meaning of
         Section 21E of the  Securities  Exchange  Act of 1934.  Forward-looking
         statements  are  subject to risks and  uncertainties  that could  cause
         actual results to differ  materially from those expressed or implied by
         the statements.  These risks and uncertainties include general economic
         and  business  conditions,  development  and market  acceptance  of the
         Company's products, current dependence on Well to Wire Energy, Inc. and
         other risks and  uncertainties  identified in the Company's  reports to
         the Securities and Exchange  Commission,  periodic press  releases,  or
         other public documents or statements.

         Readers are  cautioned not to place undue  reliance on  forward-looking
         statements. The Company undertakes no obligation to republish or revise
         forward-looking statements to reflect events or circumstances after the
         date hereof or to reflect the occurrences of unanticipated events.

         Background

         Coates   International  Ltd.  (CIL,  or  the  Company)  is  a  Delaware
         corporation  organized  in  October  1991 by  George  J.  Coates as the
         successor  in  interest  to a  Delaware  corporation  of the same  name
         incorporated in August 1988.

         CIL has  completed  the  development  of a spherical  rotary  valve SRV
         Engine  (the  "Coates  SRV  Engine"),  the  development  of  which  was
         initiated  by its  founder,  George  J.  Coates,  for  use in  internal
         combustion engines of all types. With respect to the Coates SRV Engine,
         seven applicable United States patents (the "Coates Patents") have been
         issued to George J. Coates.  CIL holds an exclusive license from George
         J. Coates and his son Gregory Coates,  to  manufacture,  sell and grant
         sub-licenses  with  respect to  products  based on the Coates  Patents,
         within  all  of  the  countries,  their  territories  and  possessions,
         comprising  North  America,  South  America  and Central  America  (the
         "License Areas").  Agreements between George J. Coates, Gregory Coates,
         and CIL also contain certain non-compete clauses and rights relative to
         royalties received from Nicholson McLaren or from Noble Motor Sport.

         CIL has a 14-year  operating  history,  during  which it has  primarily
         devoted its attention to developing the technology  associated with the
         Coates SRV Engine.

         Agreements with Well to Wire Energy, Inc.

         On September  29, 1999,  CIL signed a license  agreement  (the "License
         Agreement")  with Well to Wire  Energy,  Inc.  ("WWE"),  an oil and gas
         company in Canada, to license the exclusive use of V-8 cylinder engines
         modified with the Coates System to be fueled by natural gas to generate
         electrical  power for the Country of Canada (the  "License  Agreement")
         against payment of $5,000.000, of which a deposit payment in the amount
         of $300,000 was made. The agreement also provides for  development  and
         delivery of certain  prototype  engines  under a separate  research and
         development  agreement  between  CIL and WWE,  referred  to as the "R&D
         Agreement",  and stipulates  that following the testing and delivery of
         the third prototype - a production  model Coates Generator Engine - the
         balance of the license fee in the amount of $4,700,000 would be paid in
         16 quarterly payments beginning 180 days after delivery.



                                       7
<PAGE>

         Following due diligence  investigation of the proposed applications for
         the production of electrical  energy and the location of the engines in
         the natural gas fields or generation  sites,  it was agreed between CIL
         and Well to Wire Energy,  Inc. that a larger  engine  modified with the
         Coates System would be more appropriate.  Accordingly,  CIL and Well to
         Wire agreed that CIL would  research and develop a natural gas fed, 855
         cubic  inch,  6 cylinder,  industrial  electric  generator  engine (the
         "Coates Generator Engine").

         Pursuant to further negotiations, CIL and WWE agreed that WWE would pay
         to CIL a $5,000,000  fee to research and develop a production  model of
         the Coates Generator Engine.  As part of the understanding  between CIL
         and WWE under  the R&D  Agreement,  CIL would  develop a total of three
         prototype  engines  meeting  these  new  specifications:   two  testing
         prototypes and one production  model  prototype.  To date, Well to Wire
         Energy, Inc. has made aggregate payments of $1,200,000 to CIL for these
         prototypes,  $250,000 of which was paid in calendar  1999;  $845,000 of
         which was paid in fiscal year 2000,  and  $105,000  was paid during the
         first quarter in fiscal year 2001.  The balance of $3,800,000 is due to
         be paid by from Well to Wire Energy,  Inc.  180 days after  delivery of
         the production  model.  CIL has completed the construction and delivery
         of the first two  prototypes  and the basic  construction  of the third
         prototype,  representing the production version of the Coates Generator
         Engine. The first two prototype Coates Generator Engines were delivered
         to Well to Wire  Energy,  Inc.  in  December,  2000  and  April,  2001,
         respectively.  The  third  prototype  engine  is  currently  undergoing
         testing and is expected to be completed during fiscal year 2003.

         Agreement with McLean, England and Associates, LLC

         During the first quarter of 2002 CIL  negotiated a license  arrangement
         with McLean, England and Associates, LLC ("McLean") which, on April 12,
         2002,  produced a final agreement that calls for $25,000,000 in license
         fees for specific uses of the Coates CSRV engine  technology in certain
         applications,  within  the  United  States of  America.  Payment of the
         license fee is contingent  upon the  successful  completion of tests of
         two prototype  engines  fitted with the CSRV system.  The two prototype
         engines are currently in development.  At the time of this  submission,
         McLean has paid CIL a  non-refundable  deposit of $565,000  against the
         license fee, of which  $25,000 and $540,000  were  received  during the
         first and second quarters of 2002,  respectively.  The entire amount of
         $565,000 has been  recognized  in the balance  sheet at  September  30,
         2003, as a current liability, to be re-classified in subsequent periods
         as income.

         On April 1, 2004,  the  Company  amended  its  license  agreement  with
         McLean,  England  and  Associates,  LLC.  Pursuant  to this  amendment,
         McLean,  England and Associates shall take delivery of the no. 1 diesel
         855 engine  incorporating  the Coates CSRV System from the Company and,
         at licensee's own expense, undertake further required modifications.

         Preliminary Agreement with Dominion International

                  During the quarter  ended  September  30,  2002 CIL  commenced
                  negotiations    with   a   Florida-based    group,    Dominion
                  International ("Dominion") for a license arrangement agreement
                  covering specific uses of the Coates CSRV engine technology in
                  certain  applications,  within  the  territory  of the  United
                  States.  During the quarter ended September 30, 2002, Dominion
                  paid CIL a  non-refundable  deposit of $75,000,  to be applied



                                       8
<PAGE>

                  against the license fee. The Company and Dominion are still in
                  negotiations  over the  terms  and  provisions  of a  proposed
                  license agreement.

         Results of Operations for the Three Month Periods Ended March 31, 2004
         and 2003

         CIL's currently anticipated sources of revenues are the payments due to
         CIL from WWE under the R&D Agreement and the License Agreement, and the
         payments  made and to be made  under the  agreements  with  McLean  and
         Dominion.  Further  payments are not scheduled  until the completion of
         the testing  and  delivery  to WWE of the third  prototype,  production
         model Coates Generator Engine. CIL has completed the basic construction
         of this production  model and currently  expects  completion of testing
         and  delivery to occur  during the current  fiscal  year.  In addition,
         McLean and CIL expect to complete the development, testing and delivery
         of at least the first no.1 diesel 855 engine  incorporating  the Coates
         CSRV System also during the current fiscal year.

         Total  operating  expenses for the quarter  ended March 31, 2004,  were
         $308,252  compared to $392,906 for the first quarter in 2003.  Research
         and  development  costs were $39,978 and $62,791 for the quarters ended
         March 31, 2004 and 2003, respectively. This approximate 36% decrease in
         research  and  development  expense  is  attributable  to the fact that
         development of the Company's Coates Generator Engine has been completed
         and approximately $22,000 of this expense is labor charges.

         No  revenues   were   generated   during  the   quarter.   General  and
         administrative  expenses  were  $268,274 for the quarter as compared to
         $330,115 for the quarter  ended March 31, 2003.  The Company had a loss
         for the quarter of  $340,338,  or $.00 per share,  as compared to a net
         loss of $430,369, or $.00 per share, for the first quarter of 2003.

         Management expects the license agreements described above to contribute
         an increasing stream of revenues during the upcoming periods. There can
         be no assurance,  however,  that  completion and testing of the various
         prototype engines can be completed in a satisfactory  manner and within
         the anticipated time frames, and that other  contributing  factors will
         not prohibit or delay  finalization and consummation of the agreements,
         in which  case  revenues  in the short run would be  limited to certain
         non-refundable deposit payments.

         Liquidity and Capital Resources

         The  Company  had a cash  position  of  $76,603 at March 31,  2004,  an
         approximate  87% decrease  from the $578,398  cash position at December
         31,  2003.  This March 31, 2004 cash  position of $76,603  reflects the
         Company's  inactivity in the private  equity market as was the case for
         the quarter  ended March 31, 2003.  CIL's  working  capital  deficit of
         $1,352,102 at March 31, 2004 represents an approximate  $1,255,000,  or
         1,300%  decrease in the $96,510  working  capital  deficit  position at
         December 31, 2003. CIL's current liabilities of $1,808,461 at March 31,
         2004 have increased since December 31, 2003 ($860,372) primarily due to
         the  reclassification  of $940,000 in license deposits from non-current
         to current liabilities.

                  CIL has  completed the basic  construction  of the last of the
         three prototype Coates Generator Engines for WWE, the production model,
         which is  currently  undergoing  testing in  connection  with CIL's R&D
         Agreement  and  License  Agreement  with  Well  to  Wire  Energy,  Inc.
         Management expects to be able to complete the testing of the production
         model and delivery to WWE during the current  fiscal year,  after which
         CIL  expects to receive  the  balance of  $3,800,000  from Well to Wire


                                       9
<PAGE>

         Energy, Inc under the R&D Agreement.  Under this License Agreement, the
         balance due CIL of  $4,700,00  is payable in equal  quarterly  payments
         over a four year period,  commencing 180 days following delivery to WWE
         of the third prototype.  As well, CIL and McLean expect to complete the
         further required modifications and testing of at least the no. 1 diesel
         855 engine  incorporating  the Coates  CSRV  System  during the current
         fiscal year pursuant to its license  agreement with McLean, as amended,
         and receive the license fee  payments  during the current  fiscal year.
         There can be no assurance,  however, that these agreements,  as well as
         those  presently  in  negotiations  with the other  licensees,  will be
         consummated  in accordance  with these  expectations  and that payments
         will be received as called for in the agreements.

         During the second quarter of 2003, the Company  organized a subsidiary,
         Coates  Motorcycle  Company,  Ltd.,  to  research  and  develop a heavy
         cruiser  motorcycle  equipped with the Coates SRV engine. In connection
         with this  project,  on April 30, 2003,  CIL executed and  delivered an
         exclusive  Sublicense  Agreement  to Coates  Motorcycle  Company,  Ltd.
         ("Coates  Motorcycle") in exchange for a 50+% equity ownership interest
         and anti-dilution  right to maintain this majority ownership  position.
         In  consideration   for  its  receipt  of  this  exclusive   Sublicense
         Agreement,  Coates  Motorcycle issued 2,550,000 of its common shares to
         CIL and became its subsidiary. Conjunctively, George J. Coates, Gregory
         G. Coates and the Coates Trust granted a  non-exclusive  license at the
         same time to Coates  Motorcycle for a minority equity interest  without
         any anti-dilution rights.

         On  March  5,  2004  this  Sublicense  Agreement  was  amended  and the
         anti-dilution  rights  were  terminated  and the  Company  received  an
         additional 1,000,000 shares of Coates Motorcycle.

ITEM 3. CONTROLS AND PROCEDURES

      (a) Evaluation of Disclosure Controls and Procedures.

            Within the 90 days prior to the filing date of this Quarterly Report
on Form 10-QSB, our Chief Executive Officer and our Principal  Financial Officer
evaluated the effectiveness of our disclosure controls and procedures as defined
in Rule  13a-14(c)  under the  Securities  Exchange Act of 1934, as amended (the
"Exchange Act"). Based upon that evaluation, the Chief Executive Officer and the
Principal Financial Officer, have concluded that our current disclosure controls
and procedures are adequate and effective to ensure that information required to
be  disclosed  in the  reports  we file  under  the  Exchange  Act is  recorded,
processed, summarized and reported on a timely basis.

      (b) Changes in Internal Controls.

            There have been no significant  changes in our internal  controls or
in other factors that could significantly affect internal controls subsequent to
the date of their  evaluation by the Chief  Executive  Officer and the Principal
Financial Officer.



                                       10
<PAGE>

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

There are no material legal proceedings pending against the Company.

Item 2 CHANGES IN SECURITIES

             None

c) sales of unregistered securities during the quarter ended March 31, 2004:

             None

 Item 3 DEFAULTS ON SENIOR SECURITIES

             None

Item 4 SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

      On  March  5,  2004,  the  Company   declared  a  stock  dividend  to  its
stockholders  of  record  at the close of  business  on that date to  distribute
1,000,000 shares of the common stock of Coates  Motorcycle it received  pursuant
to the terms of the  Sublicense  Agreement.  Stockholders  of record on March 5,
2004,  will be  entitled  to  receive  1 share of the  common  stock  of  Coates
Motorcycle for each 44.3067 Company common shares  beneficially  owned of record
on that  date.  No  dividend  will be issued  on  fractional  shares.  The stock
dividend is subject to certain contingencies:  the effective registration of the
1,000,000 Coates  Motorcycle  common shares under the Securities Act of 1933 for
purposes  of  distributing  these  shares  to  Company  shareholders,   and  the
successful closing on the public sale of the minimum amount of Coates Motorcycle
units in its initial public offering.

 Item 5 OTHER INFORMATION

            None

Item 6 EXHIBITS AND REPORTS ON FORM 8-K

                  (a) Exhibits:

                  (3)(i)  Certificate of Incorporation and Amendments thereto as
            well as other corporate  documents  required to be filed as exhibits
            hereto are incorporated herein by reference to these documents filed
            as  exhibits to the  Company's  current  reports and annual  reports
            previously filed with the Commission.

                  10.16 Amendment No. 1 to Sublicense Agreement,  dated March 5,
            2004, by and between Coates International, Ltd., as Sublicensee, and
            Coates Motorcycle Company, Ltd., as Sublicensor.

                  10.17 Amendment to License Agreement,  dated April 1, 2004, by
            and between  Coates  International,  Ltd., as Licensor,  and McLean,
            England and Associates, LLC, as Licensee.

                  31.1 and 31.2 Certification of the Chief Executive Officer and
            Principal   Financial   Officer  pursuant  to  Section  302  of  the
            Sarbanes-Oxley Act of 2002.

                  (b) Reports on Form 8-K:      None.



                                       11
<PAGE>

                                   SIGNATURES

      Pursuant to the  requirements of the Securities  Exchange Act of 1934, the
Registrant has duly caused this Form 10-QSB for the quarter ended March 31, 2004
to be signed on its behalf by the undersigned, thereunto duly authorized.


Date: May 17, 2004               COATES INTERNATIONAL, LTD.

                                 By: /s/ George J. Coates
                                     -----------------------
                                 George J. Coates, President
                                 Chief Executive Officer and
                                 Principal Financial Officer



                                       12