<PAGE>   1


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

                                    FORM 10-Q

(Mark One)

     [X]    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
            EXCHANGE ACT OF 1934

            For the quarterly period ended October 31, 1997

                                       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 0-28072

                      West Coast Entertainment Corporation
             (Exact name of registrant as specified in its charter)

            Delaware                                        04-3278751
(State or other jurisdiction of                       (I.R.S. Employer I.D. No.)
incorporation or organization)

One Summit Square, Suite 200, Rte. 413 & Doublewoods Rd.
Langhorne, Pennsylvania                                           19047
(Address of principal executive offices)                      (Zip Code)

Registrant's telephone number, including area code:  (215)968-4318

     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) had been subject to
     such filing requirements for the past 90 days.

                                Yes /X/ No / /

     Indicate the number of shares outstanding of each of the issuer's classes
     of common stock, as of the latest practicable date.

<TABLE>
<CAPTION>
                  Class                          Outstanding at December 4, 1997
                  -----                          -------------------------------
<S>                                              <C>
            Common Stock, $.01                            13,682,953
            par value per share
</TABLE>
<PAGE>   2
                                      INDEX


<TABLE>
<CAPTION>
Part I.           -  Financial Information                                      Page No.
<S>               <C>                                                           <C>
      Item 1.     -  Financial Statements

                  Consolidated Balance Sheets -
                        As of October 31, 1997 and January 31, 1997                 3

                  Consolidated Statements of Operations-
                        Three and Nine Months Ended October 31, 1997 and 1996       4

                  Consolidated Statements of Cash Flows-
                        Nine Months Ended October 31, 1997 and 1996                 5

                  Notes to Consolidated Financial Statements                        6

      Item 2.     -  Management's Discussion and Analysis of Financial Condition
                     and Results of Operations                                      10


Part II.          -  Other Information                                              19
</TABLE>

      Item 1.  -  Legal Proceedings
      Item 2.  -  Changes in Securities
      Item 3.  -  Defaults Upon Senior Securities
      Item 4.  -  Submission of Matters to a Vote of the Security Holders
      Item 5.  -  Other Information
      Item 6.  -  Exhibits and Reports on Form 8-K


<PAGE>   3
                      WEST COAST ENTERTAINMENT CORPORATION
                           CONSOLIDATED BALANCE SHEET
                      (in thousands, except for par value)

<TABLE>
<CAPTION>
                                                                    October 31         January 31,
                                                                        1997              1997
                                                                     ---------          --------
                                                                    (unaudited)
<S>                                                                 <C>                <C>
Assets:

Current assets:
  Cash and cash equivalents                                          $   2,830          $  1,311
  Accounts receivable                                                    1,566             1,899
  Merchandise inventory                                                  9,207             6,333
  Prepaid expenses and other current assets                              4,083             2,046
  Receivable from officers                                                 217               141
  Deferred tax asset                                                     2,330                --
                                                                     ---------          --------

    Total current assets                                                20,233            11,730

Videocassette rental inventory, net of amortization                     30,692            24,598
Furnishings, equipment and leasehold improvements, net                  18,722            11,285
Other assets                                                             2,310             2,998
Intangible assets, net of accumulated amortization                     118,250           109,193
Deferred tax asset                                                         160               160
                                                                     ---------          --------

    Total assets                                                     $ 190,367          $159,964
                                                                     =========          ========

Liabilities and Stockholders' Equity:

Current liabilities:
  Current portion of long-term debt                                  $      14          $     19
  Accounts payable                                                      19,636            12,941
  Accrued expenses and other liabilities                                 3,397             4,647
  Income taxes                                                              --             1,555
  Deferred tax liability                                                    --               566
                                                                     ---------          --------

    Total current liabilities                                           23,047            19,728

Long-term debt (net of current portion)                                 65,002            32,802
Other long-term liabilities                                                287               299
                                                                     ---------          --------

    Total liabilities                                                   88,336            52,829

Stockholders' equity:
  Common stock ($0.01 par value; 13,826 shares
    as of October 31, 1997, of which 13,641 shares were
    outstanding and 185 shares to be issued; and
    13,770 shares outstanding at January 31, 1997)                         138               138
  Preferred stock ($0.01 par value, 2,000 shares
    authorized, no shares issued)                                           --                --
  Additional paid in capital                                           104,027           103,947
  Accumulated surplus/(deficit)                                         (2,134)            3,050
                                                                     ---------          --------

    Total stockholders' equity                                         102,031           107,135
                                                                     ---------          --------

    Total liabilities and stockholders' equity                       $ 190,367          $159,964
                                                                     =========          ========
</TABLE>

                 See accompanying notes to financial statements


                                      -3-
<PAGE>   4
                      WEST COAST ENTERTAINMENT CORPORATION
                      CONSOLIDATED STATEMENT OF OPERATIONS
                      (in thousands, except per share data)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                              Three months ended                Nine months ended
                                                                   October 31,                     October 31,
                                                            ------------------------        ------------------------
                                                              1997            1996            1997            1996
                                                            --------        --------        --------        --------
<S>                                                         <C>             <C>             <C>             <C>
Revenues:
  Rental revenue                                            $ 24,893        $ 16,402        $ 72,261        $ 33,752
  Merchandise and other sales                                  4,660           2,079          12,809           4,818
  Franchise fees                                                 474           1,483           1,813           3,792
                                                            --------        --------        --------        --------

    Total revenues                                            30,027          19,964          86,883          42,362
                                                            --------        --------        --------        --------

Operating costs and expenses:
  Store operating expenses                                    14,902           9,780          42,160          18,784
  Cost of goods sold                                           3,167           1,345           8,773           3,133
  Amortization of videocassette and video game rental
    inventory (Note 2)                                         7,484           3,752          18,943           6,956
  General and administrative                                   3,657           2,931          11,147           7,623
  Intangible amortization                                      1,866           1,046           4,866           2,029
  Debt offering write offs (Note 6)                               --              --           5,125              --
                                                            --------        --------        --------        --------

    Total operating costs and expenses                        31,076          18,854          91,014          38,525
                                                            --------        --------        --------        --------

Income (loss) from operations                                 (1,049)          1,110          (4,131)          3,837
                                                            --------        --------        --------        --------

Interest expense                                               1,443             222           3,387             730
Other, net                                                       (18)            (61)            (82)           (129)
                                                            --------        --------        --------        --------

Income(loss) before provision for income taxes and
 extraordinary item                                           (2,474)            949          (7,436)          3,236

Provision for income taxes                                      (837)            418          (2,252)          1,421
                                                            --------        --------        --------        --------

Income(loss) before extraordinary item                        (1,637)            531          (5,184)          1,815

Extraordinary item  (net of
 income tax benefit of $156)                                      --              --              --            (244)
                                                            --------        --------        --------        --------

Net income (loss)                                           ($ 1,637)       $    531        ($ 5,184)       $  1,571
                                                            ========        ========        ========        ========

Income(loss) per common share data (Note 5):

Income(loss) before extraordinary item                      ($  0.12)       $   0.04        ($  0.38)       $   0.19
                                                            ========        ========        ========        ========

Extraordinary item                                                --        $     --              --        ($  0.02)
                                                            ========        ========        ========        ========

Net income (loss)                                           ($  0.12)       $   0.04        ($  0.38)       $   0.17
                                                            ========        ========        ========        ========

Weighted average shares outstanding                           13,826          12,460          13,812           9,493
                                                            ========        ========        ========        ========
</TABLE>

                 See accompanying notes to financial statements


                                      -4-
<PAGE>   5
                      WEST COAST ENTERTAINMENT CORPORATION
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                 (in thousands)
                                   (unaudited)

<TABLE>
<CAPTION>
                                                                Nine months ended
                                                                   October 31
                                                            ------------------------
                                                              1997            1996
                                                            --------        --------
<S>                                                         <C>             <C>
Cash flows from operating activities:
  Net income                                                $ (5,184)       $  1,571
  Adjustments to reconcile net income to cash
    flows provided by (used in) operating activities:
    Amortization of debt financing costs                         157              --
    Amortization of videocassette rental inventory            18,943           6,956
    Depreciation and amortization of furnishings,
      equipment and leasehold improvements                     1,336             680
    Amortization of intangible assets                          4,866           2,035
    Deferred taxes                                            (2,896)             --
    Changes in assets and liabilities:
      Accounts receivable                                        333            (900)
      Merchandise inventories                                 (2,874)         (2,168)
      Prepaid expenses and other assets                       (2,319)         (1,097)
      Accounts payable                                         6,695           2,256
      Accrued expenses and other liabilities                  (1,250)         (2,437)
      Income taxes                                            (1,555)            499
                                                            --------        --------

    Net cash provided by operating activities                 16,252           7,395
                                                            --------        --------

Cash flows from investing activities:
  Purchase of property and equipment                          (6,007)           (818)
  Purchase of videocassette rental inventory                 (22,083)        (10,394)
  Purchase of businesses, net of cash acquired               (18,918)        (62,804)
  Changes in other assets related to acquisitions                 --          (1,500)
                                                            --------        --------

    Net cash used in investing activities                    (47,008)        (75,516)
                                                            --------        --------

Cash flows from financing activities:
  Proceeds from long-term debt                                32,200          17,100
  Repayment of long-term debt                                     (5)        (10,273)
  Proceeds from issuance of common stock, net                     80          63,079
  Shareholder distributions                                       --              --
  Changes in other assets related to financing                    --            (700)
                                                            --------        --------

    Net cash provided by financing activities                 32,275          69,206
                                                            --------        --------

Net increase in cash and cash equivalents                      1,519           1,085

Cash and cash equivalents, beginning of period                 1,311             611
                                                            --------        --------

Cash and cash equivalents, end of period                    $  2,830        $  1,696
                                                            ========        ========

Supplemental cash flow data:
  Interest paid                                             $  3,136        $    731
                                                            ========        ========

  Income taxes paid                                         $  2,199        $  1,078
                                                            ========        ========
</TABLE>

                 See accompanying notes to financial statements


                                      -5-
<PAGE>   6
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
October 31, 1997 (unaudited)


1     Basis of Presentation

      The accompanying unaudited consolidated financial statements have been
      prepared in accordance with generally accepted accounting principles for
      interim financial information and pursuant to the rules and regulations of
      the Securities and Exchange Commission ("SEC"). Accordingly, they do not
      include all of the information and footnotes required by generally
      accepted accounting principles for complete financial statements. For
      further information, refer to the consolidated financial statements and
      footnotes included in West Coast Entertainment Corporation's (the
      "Company's") Form 10-K filed with the SEC on May 1, 1997.

      The preparation of financial statements in conformity with generally
      accepted accounting principles requires management to make estimates and
      assumptions that affect the reported amounts of assets and liabilities and
      disclosure of contingent assets and liabilities at the date of the
      financial statements and the reported amounts of revenue and expenses
      during the reported period. Actual results could differ from these
      estimates.

      In the opinion of management, all adjustments necessary for a fair
      presentation of this interim financial information have been included.
      Such adjustments consisted only of normal recurring items except for the
      change in amortization of videocassette rental inventory described in 
      Note 2 below. The results of operations for the three and nine months
      ended October 31, 1997 are not necessarily indicative of the results to be
      expected for the year ending January 31, 1998.

      Income per common share data has been calculated utilizing the weighted
      average number of common shares outstanding after giving effect to the
      0.340-for-1 reverse stock split, which was approved by the Board of
      Directors on May 14, 1996, as if it had occurred as of February 1, 1996.
      In addition, shares to be issued as contingent consideration in
      conjunction with the May 1996 and Early Fall 1996 Acquisitions (Note 3)
      have been considered outstanding since May 17, 1996.

2     Videocassette Rental Inventory

      Videocassette rental inventory and related amortization are as follows (in
      thousands):

<TABLE>
<CAPTION>
                                           October 31, 1997     January 31, 1997
                                           ----------------     ----------------
<S>                                        <C>                  <C>
      Videocassette rental inventory            $60,928             $ 35,891
      Accumulated amortization                  (30,236)             (11,293)
                                                -------             --------
                                                $30,692             $ 24,598
                                                =======             ========
</TABLE>

      Amortization expense related to videocassette rental inventory totaled
      $7,484,000, $18,943,000, $3,752,000 and $6,956,000 for the three months
      and nine months ended October 31, 1997 and October 31, 1996, respectively.

      Effective August 1, 1997, the Company adopted an accelerated method of
      amortizing its videocassette rental inventory. Under this new method,
      videocassette rental inventory base stock (the first three copies of a
      title in a particular store) is amortized over its economic life of 36
      months to its estimated salvage value of $6. New release base stock, less
      the $6 salvage value, is amortized 50% in the first six months, then
      amortized on a straight-line basis to the $6 salvage value over the
      remaining 30 months. All copies of new release videocassette rental
      inventory in excess of 3 copies per store are amortized on a straight- 
      line basis during the first nine months to $10 and the balance is
      amortized on a straight-line basis over the remaining 27 months to the
      $6 salvage value.

      The new method of amortization was adopted because the Company believes
      accelerated expense recognition for new release videocassettes during the
      first six months more closely matches the typically higher revenue
      generated following a title's release and $6 represents a reasonable
      salvage value for all tapes after 36 months.

      The new method of amortization has been applied to videocassette rental
      inventory that was held in inventory at August 1, 1997. The adoption of
      the new method of amortization has been accounted for as a change in
      accounting estimate effected by a change in accounting principle and,
      accordingly, the company recorded an $803,000 pre-tax charge to operating
      expense as of August 1, 1997. The application of the new method of
      amortizing videocassette rental inventory increased amortization expense
      for the three and nine months ended October 31, 1997 by $803,000 and
      reduced net income by $506,000 and earnings per share by $.04.

      Prior to August 1, 1997, videocassette rental inventory was amortized over
      its useful economic life with no provision for salvage value. Base stock 
      was amortized over 36 months on a straight-line basis. New release 
      videocassettes were amortized as follows: base stock was amortized over 
      36 months on a straight-line basis and copies in excess of three per 
      store were amortized over nine months on a straight-line basis.

      Videocassette rental inventory amortization expense resulting from the
      allocation of purchase price to videocassette rental tapes of the acquired
      entities is based on current replacement cost for bulk purchases of used
      tapes as well as the assignment of a three year amortizable life which
      serves to extend the remaining economic useful lives of videocassette
      rental tapes acquired. Replacement cost for bulk purchases of used tapes
      is significantly less than the cost of new tape purchases. As a result,
      future amortization relating to these tapes, on a per tape basis, will be
      significantly less than the amortization relating to new tape purchases.
      In addition, to the extent the acquired tapes have book values lower than
      newly purchased tapes, sales of the acquired


                                       6
<PAGE>   7
   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
   October 31, 1997 (unaudited)


      tapes should result in higher operating income than sales of new tape
      purchases. The favorable effects resulting from purchase accounting will
      diminish with the passage of time and will not extend beyond the three
      year period subsequent to acquisition which is the period over which these
      tapes will be amortized.

   3  Acquisitions

      May 1996 Acquisitions

      On May 17, 1996, the Company acquired 172 video specialty stores 
      (the "May 1996 Acquisitions"), including 13 stores owned by franchisees of
      the Company. Taking into account certain adjustments and calculation of
      certain contingent payments, the aggregate consideration of $83.9 million
      was paid consisting of the following: $53.0 million in cash, approximately
      $26.2 million in shares of common stock (2.1 million shares), and
      approximately $4.7 million of acquisition costs. Of these amounts,
      approximately $0.4 million represents remaining minimum contingent
      consideration (of which approximately $0.1 million and $0.3 million
      (19,734 shares) is to be paid in cash and stock, respectively).

      Early Fall 1996 Acquisitions

      Between August 26 and October 25, 1996, the Company acquired the assets of
      21 video specialty stores (the "Early Fall 1996 Acquisitions"). Aggregate
      consideration of $13.6 million was paid, consisting of the following: $8.2
      million in cash, $4.9 million in shares of common stock (0.5 million
      shares), and approximately $0.5 million of acquisition costs. The shares
      (0.4 million) associated with one of these acquisitions are to be issued
      in three equal installments (six, twelve and eighteen months from the
      acquisition date) and the number of shares issuable will be increased in
      certain cases by the difference between the share price at issuance date
      and a formulaic common share price calculated as of the date of
      acquisition. Additionally, 0.1 million shares associated with another
      Early Fall 1996 Acquisition are to be issued. In both instances these
      common shares and other common shares to be issued in installments have
      been considered outstanding as of the beginning of the periods presented.

      Late Fall 1996 Acquisitions

      Between November 15 and December 3, 1996, the Company acquired the assets
      of 47 video specialty stores (the "Late Fall 1996 Acquisitions"),
      including 19 stores owned by franchisees of the Company for aggregate
      consideration of $27.7 million consisting of the following: $14.4 million
      in cash, $11.0 million in shares of common stock (1.0 million shares) and
      approximately $2.3 million of acquisition costs.

      June, 1997 Acquisitions

      On June 16, 1997, and June 24, 1997 the Company acquired a total of 38
      video specialty stores (the "June, 1997 Acquisitions"), including 5 stores
      owned by a franchisee of the Company for aggregate consideration of $17.9
      million consisting of $17.2 million in cash and approximately $0.7 million
      of acquisition costs.

      The excess of the cost over the fair value of the assets acquired is being
      amortized over 20 years on a straight line basis. The results of
      operations of the acquired stores have been included in


                                       7
<PAGE>   8
   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
   October 31, 1997 (unaudited)


      operations of the Company since the date of acquisition.  The purchase
      method of accounting was used to account for the acquisitions.

      The following unaudited pro forma information presents the results of
      operations as though (i) the May 1996 Acquisitions, Early Fall 1996
      Acquisitions, Late Fall 1996 Acquisitions and June, 1997 Acquisitions 
      had occurred as of the beginning of the periods presented, (ii) each 
      entity included in the consolidated statement of operations had been 
      included in the Company's consolidated income tax returns and subject to 
      corporate income taxation as a C corporation during all periods 
      presented, and (iii) the borrowings under the Credit Facility had 
      occurred as of the beginning of the periods presented.

      The following unaudited pro forma net income per share for the three
      months and nine months ended October 31, 1996 and 1997 was calculated by
      dividing the respective unaudited pro forma net income by the pro forma
      weighted average number of shares of Common Stock outstanding after giving
      effect to (i) the 0.340-for-1 reverse stock split approved by the Board of
      Directors on May 14, 1996, and the shares issued in conjunction with the
      Initial Public Offering on May 17, 1996 ("the Offering"), (ii) issuance of
      shares in connection with the May 1996, Early Fall 1996 and Late Fall 1996
      Acquisitions, (iii) repayment of outstanding debt at the date of the 
      Offering, and (iv) the impact of a detachable warrant with a primary 
      supplier of videocassettes and a portion of a convertible note which was 
      converted into shares of the Company's common stock as if the transactions
      had occurred on the first day of the periods presented. The pro forma 
      weighted average number of common shares used to calculate pro forma net 
      income per share was 14,017,840 for the three and nine months ended
      October 31, 1997 and 14,000,605 for the three and nine months ended
      October 31, 1996.

<TABLE>
<CAPTION>
                                                                Unaudited
                                                                Pro Forma
                                           ------------------------------------------------------
                                             Three Months Ended           Nine Months Ended
                                                 October 31,                 October 31,

                                                  (in thousands, except per share data)
                                             1997           1996           1997           1996
                                           --------        -------       --------        -------
<S>                                        <C>             <C>           <C>             <C>
      Pro Forma revenues                   $ 30,027        $30,402       $ 93,174        $95,326
      Pro forma net income                   (1,637)         1,484         (4,833)         5,408
      Pro forma net income per share       $  (0.12)       $  0.11       $  (0.34)       $  0.39
</TABLE>

4     Long Term Debt

      On May 17, 1996 the Company obtained a $60,000,000 Credit Facility ("the
      Facility") from a bank which consists of a 17 month revolving credit
      facility followed by a three year term loan. In association with the
      borrowing the Company paid a fee of $700,000 on May 17, 1996 which has
      been recorded in other long term assets and will be amortized over the
      term of the Credit Facility. Borrowings under the Facility are available
      for working capital, capital expenditures, refinancing of existing
      indebtedness, and for certain permitted acquisition financing.

      On October 31, 1996 the Company received a commitment from the Bank to
      increase the Credit Facility to $65,000,000 effective August 5, 1996. As
      of October 31, 1997 the Company had $65,000,000 outstanding under the
      Facility.

      On December 15, 1997 the Company signed an amendment increasing the 
      Facility to $70,000,000 with current commitments from the participating
      banks for $65,000,000 (the "Amended Facility"). The Amended Facility has
      a five year term ending December 14, 2002.


                                       8
<PAGE>   9
   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)
   October 31, 1997 (unaudited)

      If the Company attains certain total debt to operating cash flow
      ratios, as defined, the commitment reduces quarterly commencing
      June 15, 1999 and continues through the end of the term on December 14, 
      2002. If such total debt to operating cash flow  ratios are not attained, 
      the quarterly commitment reductions will start on December 15, 1998. Any
      amounts in excess of the commitment, as it may be reduced from time to 
      time, must be repaid.

      Borrowings under the Amended Facility are limited to a multiple of
      operating cash flow, as defined, over the previous four quarters. At
      December 15, 1997, this multiple is 4.50 times operating cash flow, and
      reduces over the next four fiscal quarters to a low of 3.25 times
      operating cash flow on October 31, 1998 and thereafter. At the Company's
      option, interest rates vary from either the Bank's base rate, as defined,
      to 1.5% above such base rate or from the Eurodollar rate, as defined, to
      3.0% above such Eurodollar rate. The Company's weighted average borrowing
      rate under the Facility was 8.34% for the three months ended October 31,
      1997. Additionally, the Amended Facility provides for a commitment fee
      payable quarterly, computed up to 0.5% of the unused portion of the 
      available facility during the previous quarter.

      The Amended Facility is secured by a first security interest in
      substantially all of the Company's assets, including the stock of its
      subsidiaries, and provides for certain restrictive covenants, including
      among others compliance with certain financial tests and ratios and
      dividend restrictions.

5     Earnings Per Share

      In February 1997, Statements of Financial Accounting Standards (SFAS) No.
      128, "Earnings Per Share", was issued. This pronouncement will be
      effective for the Company's year ending January 31, 1998 financial
      statements. SFAS No. 128 supersedes the pronouncement of the Accounting
      Principles Board (APB) No. 15. The statement eliminates the calculation of
      primary earnings per share and requires the disclosure of Basic Earnings
      Per Share and Diluted Earnings Per Share (formerly referred to as fully
      diluted earnings per share). SFAS No. 128 would not have had a material
      impact on the Company's calculation of earnings per share for the three
      and nine months ended October 31, 1997. Basic Earnings Per Share and
      Diluted Earnings Per Share would be the same for the three and nine months
      ended October 31, 1997.

6     Debt Offering Write Offs

      On July 1, 1997 the Company's private placement of debt securities (the
      "Proposed Private Placement") and related acquisitions were indefinitely
      delayed due to market conditions. The Company wrote off $5.1 million in
      costs during the three months ended July 31, 1997 that were incurred in
      connection with the Proposed Private Placement and related acquisitions.


                                       9
<PAGE>   10
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
      OF OPERATIONS

      RESULTS OF OPERATIONS

      Three Months ended October 31, 1997 compared to Three Months ended October
      31, 1996

      Revenues

      Revenues increased $10.0 million, or 50.0 %, from $20.0 million for the
      three months ended October 31, 1996 to $30.0 million for the three months
      ended October 31, 1997. This change reflected an increase of $8.5 million
      in rental revenues, an increase of $2.5 million in merchandise sales and a
      decrease of $1.0 million in franchise fee revenue. The increases in rental
      and merchandise sales revenues are mostly attributable to the acquisition
      of a total of 108 video specialty stores, consisting of 21 stores which
      were acquired on the following dates: 5 on August 26, 1996; 14 on
      September 30, 1996; 1 on October 1, 1996; and 1 on October 25, 1996; and
      an additional 87 stores which were acquired after the end of such three
      month period on the following dates: 45 on November 15, 1996; 1 on
      December 1, 1996; 1 on December 3, 1996; 1 on March 21, 1997; 1 on April
      10, 1997, 37 on June 16, 1997, and 1 on June 24, 1997.

      Rental revenues increased $8.5 million, or 51.8%, from $16.4 million for
      the three months ended October 31, 1996 to $24.9 million for the three
      months ended October 31, 1997. This change is primarily attributable to
      the inclusion of $9.0 million of rental revenues from the 108 video
      specialty stores acquired since August 1, 1996 as described above. Rental
      revenues for the Company's stores and the industry during the three months
      ended October 31, 1997 were adversely impacted by weather and by the
      release of titles that had not performed strongly at the box office.

      Merchandise sales increased $2.5 million, or 119.0%, from $2.1 million for
      the three months ended October 31, 1996 to $4.6 million for the three
      months ended October 31, 1997, reflecting $1.7 million of merchandise
      sales contributed by the 108 video specialty stores purchased since August
      1, 1996 as described above. In addition, merchandise sales for the
      Company's stores owned prior to said acquisitions increased by $0.8
      million.

      Franchise fee revenues decreased $1.0 million, or 66.7%, from $1.5 million
      for the three months ended October 31, 1996 to $0.5 million for the three
      months ended October 31, 1997. Approximately $0.1 million of this decrease
      is due to the acquisition of 25 franchised stores (which is included in
      the total 108 purchased) by the Company since August 1, 1996. The
      remaining $0.9 million decrease is attributable to a decline in the number
      of royalty payments received from franchisees due to both a decline in
      their business and a decline in the number of franchisees who make
      required payments.

      As a result of the Company's acquisition activities and other developments
      described above the mix of revenue sources changed to approximately 83.0%
      rental, 15.3% merchandising, and 1.7% franchising during the three months
      ended October 31, 1997 from approximately 82.0%, 10.5%, and 7.5%,
      respectively, during the three months ended October 31, 1996.

      Store Operating Expenses

      Store operating expenses increased $5.1 million, or 52.0 %, from $9.8
      million for the three months ended October 31, 1996 to $14.9 million for
      the three months ended October 31, 1997. This $5.1 million increase is
      primarily related to the acquisition of new stores as described above. As
      a percentage of total revenues, store operating expenses increased 0.7
      percentage points from 49.0% for the three months ended October 31, 1996
      to 49.7% for the three months ended October 31, 1997. All of this increase
      was caused by the reduction from 1996 to 1997 in the relative significance
      of the Company's franchise operations (as measured by the decrease in
      franchise revenues as a percentage of total revenues), since the franchise
      business involves virtually no store operating expenses.


                                       10
<PAGE>   11
      RESULTS OF OPERATIONS (continued)

      Cost of Goods Sold

      Cost of goods sold increased $1.8 million, or 138.5%, from $1.3 million
      for the three months ended October 31, 1996 to $3.1 million for the three
      months ended October 31, 1997, primarily as a result of an increase in
      merchandise sales volume due to the acquisition of the 108 video specialty
      stores since August 1, 1996. As a percentage of merchandise sales, cost of
      goods sold increased by 5.5 percentage points from 61.9% for the three
      months ended October 31, 1996 to 67.4% for the three months ended October
      31, 1997. This increase was primarily due to a change in sales mix caused
      by the acquisition of the 108 video specialty stores and the impact of
      "Liar Liar," a major title released in September 1997 which was sold at a
      lower margin than other sell-thru titles.

      Amortization of Videocassette and Video Game Rental Inventory

      Amortization of rental inventory increased $3.6 million, or 94.7%, from
      $3.8 million for the three months ended October 31, 1996 to $7.4 million
      for the three months ended October 31, 1997 primarily as a result of the
      acquisition of the 108 video specialty stores since August 1, 1996. As a
      percentage of rental revenues this amortization increased 6.5 percentage
      points from 23.2% for the three months ended October 31, 1996 to 29.7% for
      the three months ended October 31, 1997. This is primarily due to the
      diminishing benefits of purchase accounting for acquired stores and the 
      change in accounting for amortization of rental inventory as described in 
      Note 2.

      General and Administrative Expense

      General and administrative expenses increased $0.8 million, or 27.6%, from
      $2.9 million for the three months ended October 31, 1996 to $3.7 million
      for the three months ended October 31, 1997. The increase is primarily
      related to the additional personnel and non-store operating costs which
      were absorbed from the acquisition of the 108 video specialty stores since
      August 1, 1996 as described above. As a percentage of total revenues,
      however, general and administrative expenses decreased 2.2 percentage
      points from 14.5% for the three months ended October 31, 1996 to 12.3% for
      the three months ended October 31, 1997 primarily reflecting the ability
      of the Company's administrative staff to operate an increasing number of
      corporate stores and, to a lesser extent, the change in the mix of rental
      revenues, merchandise sales and franchise fees. Franchising has higher
      associated general and administrative costs than rental revenues and
      merchandise sales.

      Because of the indefinite delay in the Company's Proposed Private
      Placement of debt securities and related acquisitions (Note 6), the
      Company has begun to reduce its general and administrative costs from the
      levels reached in contemplation of expansion. The effects of these changes
      were partially reflected in the financial results of the three months
      ended October 31, 1997 and should be fully realized in future quarterly
      financial results.
      
      Intangible Amortization

      Intangible amortization expense increased $0.8 million, or 72.7%, from
      $1.1 million for the three months ended October 31, 1996 to $1.9 million
      for the three months ended October 31, 1997. As a percentage of total
      revenues, intangible amortization increased 0.8 percentage points from
      5.5% for the three months ended October 31, 1996 to 6.3% for the three
      months ended October 31, 1997. These increases are entirely related to
      amortization of goodwill associated with the acquisition of 108 video
      specialty stores since August 1, 1996.


      Interest Expense and Other

      Net interest expense and other increased $1.2 million, or 600.0%, from
      $0.2 million for the three months ended October 31, 1996 to $1.4 million
      for the three months ended October 31, 1997. Interest expense


                                       11
<PAGE>   12
      RESULTS OF OPERATIONS (continued)

      comprises almost all of this net amount.  As a percentage of total
      revenues, interest expense increased 3.7 percentage points from 1.0% for
      the three months ended October 31, 1996 to 4.7% for the three months
      ended October 31, 1997.  The increase is attributable to additional
      interest expense incurred in connection with the acquisition of video
      specialty stores.


      Net Income

      As a result of the foregoing, net income decreased $2.1 million from $0.5
      million of net income for the three months ended October 31, 1996 to a
      $1.6 million net loss for the three months ended October 31, 1997.





      Nine Months ended October 31, 1997 compared to Nine Months ended October
      31, 1996

      Revenues

      Revenue increased $44.6 million or 105.4% from $42.3 million for the nine
      months ended October 31, 1996 to $86.9 million for the nine months ended
      October 31, 1997. This change reflected an increase of $38.6 million in
      rental revenues, an increase of $8.0 million in merchandise sales and a
      decrease of $2.0 million in franchise fee revenue. The increases in rental
      and merchandise sales revenues are attributable to the acquisition of a
      total of 280 video specialty stores, consisting of 172 stores which were
      acquired on May 17, 1996, which were owned for only 24 weeks of the nine
      months ended October 31, 1996, and an additional 108 stores which were
      acquired after the end of such nine month period on the following dates: 5
      on August 26, 1996; 14 on September 30, 1996; 1 on October 1, 1996; 1 on
      October 25, 1996; 45 on November 15, 1996; 1 on December 1, 1996; 1 on
      December 3, 1996; 1 on March 21, 1997; 1 on April 10, 1997; 37 on June 16,
      1997; and 1 on June 24, 1997.

      Rental revenues increased $38.6 million or 114.5% from $33.7 million for
      the nine months ended October 31, 1996 to $72.3 million for the nine
      months ended October 31, 1997. This increase is primarily attributable to
      the revenues generated by the 280 video specialty stores acquired since
      May 17, 1996 as described above.

      Merchandise sales increased $8.0 million or 166.7% from $4.8 million for
      the nine months ended October 31, 1996 to $12.8 million for the nine
      months ended October 31, 1997 primarily attributable to the merchandise
      sales contributed by the 280 video specialty stores purchased since May
      17, 1996 as described above.

      Franchise fee revenue decreased $2.0 million, or 52.6% from $3.8 million
      for the nine months ended October 31, 1996 to $1.8 million for the nine
      months ended October 31, 1997. Approximately $0.5 million of this decrease
      is due to the acquisition of 39 franchised stores which is included in the
      total 280 purchased by the Company since May 17, 1996. The remaining $1.5
      million decrease is attributable to a decline in the number of royalty
      payments received from franchisees due to a decline in their business and
      a decline in the number of franchisees who make required payments.

      As a result of the Company's acquisition activities and other
      developments described above the mix of revenue sources changed to
      approximately 83.2% rental, 14.7% merchandising and 2.1% franchising
      during the nine months period ended October 31, 1997 from approximately
      79.7%, 11.3%, and 9.0%, respectively, during the nine month period ended
      October 31, 1996.

      Store Operating Expenses

      Store operating expenses increased $23.4 million, or 124.5%, from $18.8
      million for the nine months


                                       12
<PAGE>   13
      RESULTS OF OPERATIONS (continued)

      ended October 31, 1996 to $42.2 million for the nine months ended October
      31, 1997. As a percentage of total revenues, store operating expenses
      increased 4.2 percentage points from 44.4% for the nine months ended
      October 31, 1996 to 48.6% for the nine months ended October 31, 1997.
      Except as discussed below this increase was caused by the decrease from
      1996 to 1997 in the relative significance of the Company's franchise
      operations (as measured by the decrease in franchise revenues as a
      percentage of total revenues), since the franchise business involves
      virtually no store operating expenses. As a percentage of rental revenues
      and merchandise sales, store operating costs increased 0.8 percentage
      points from 48.8% for the nine months ended October 31, 1996 to 49.6% for
      the nine months ended October 31, 1997. This increase is primarily due to
      higher rent costs and payroll costs. Store salaries increased due to an
      increase in store man hours. Management has implemented steps to reverse
      this trend in man hours. Since the initial acquisition of 172 stores on
      May 17, 1996, most of the additional 108 stores acquired are located in
      large metropolitan areas which generally have higher occupancy costs.

      Cost of Sales

      Cost of goods sold increased $5.7 million, or 183.9%, from $3.1 million
      for the nine months ended October 31, 1996 to $8.8 million for the nine
      months ended October 31, 1997, primarily as a result of an increase in
      merchandise sales volume due to the acquisition of the 280 video
      specialty stores since May 17, 1996.  As a percentage of merchandise
      sales, cost of goods sold increased by 4.2 percentage points from 64.6%
      for the nine months ended October 31, 1996 to 68.8% for the nine months
      ended October 31, 1997. This increase was primarily due to a change in
      sales mix caused by the acquisition of the 280 video specialty stores and
      the sale of more sell-thru titles which have a lower margin.

      Amortization of Videocassette and Video Game Rental Inventory

      Amortization of rental inventory increased $11.9 million, or 170.0%, from
      $7.0 million for the nine months ended October 31, 1996 to $18.9 million
      for the nine months ended October 31, 1997, primarily as a result of the
      acquisition of the 280 video specialty stores since May 17, 1996. As a
      percentage of rental revenues this amortization increased 5.3 percentage
      points from 20.8% for the nine months ended October 31, 1996 to 26.1% for
      the nine months ended October 31, 1997. This is primarily due to purchase
      accounting for acquired stores and the change in accounting for
      amortization of rental inventory as described in Note 2.


      General and Administrative Expense

      General and administrative expenses increased $3.5 million, or 46.1%,
      from $7.6 million for the nine months ended October 31, 1996 to $11.1
      million for the nine months ended October 31, 1997. The increase is
      primarily related to the additional personnel and non-store operating
      costs which were absorbed from the acquisition of the 280 video specialty
      stores in addition to an increase in Corporate personnel hired in
      anticipation of the Proposed Private Placement and related acquisitions.
      As a percentage of total revenues, however, general and administrative
      expenses decreased 5.2 percentage points from 18.0% for the nine months
      ended October 31, 1996 to 12.8% for the nine months ended October 31,
      1997 primarily reflecting the ability of the Company's administrative
      staff to operate an increasing number of corporate stores and, to a
      lesser extent, the change in the mix of rental revenues, merchandise
      sales and franchise fees. Franchising has higher associated general and
      administrative costs than rental revenues and merchandise sales.

      Because of the indefinite delay in the Company's Proposed Private
      Placement of debt securities and related acquisitions (Note 6), the
      Company has reduced its general and administrative costs from the levels
      reached in contemplation of expansion. The effects of these changes were
      partially reflected in the financial results of the three months ended
      October 31, 1997 and should be fully realized in future quarterly 
      financial results.


                                       13
<PAGE>   14
      RESULTS OF OPERATIONS (continued)

      Intangible Amortization

      Intangible amortization expense increased $2.9 million, or 145.0%, from
      $2.0 million for the nine months ended October 31, 1996 to $4.9 million
      for the nine months ended October 31, 1997. As a percentage of total
      revenues, intangible amortization increased 0.9 percentage points from
      4.7% for the nine months ended October 31, 1996 to 5.6% for the nine
      months ended October 31, 1997. These increases are entirely related to
      amortization of goodwill associated with the acquisition of 280 video
      specialty stores since May 17, 1996.

      Debt Offering Write-Offs

      During the nine months ended October 31, 1997 the Company has written-off
      $5.1 million in Debt Offering expense associated with the Proposed Private
      Placement and related acquisitions due to the Company's decision to
      indefinitely delay such offering.

      Interest Expense and Other

      Net interest expense and other increased $2.7 million or 450.0% from
      $0.6 million for the nine months ended October 31, 1996 to $3.3 million
      for the nine months ended October 31, 1997. Interest expense comprises
      almost all of this net amount. As a percentage of total revenues,
      interest expense increased 2.2 percentage points from 1.7% for the nine
      months ended October 31, 1996 to 3.9% for the nine months ended October
      31, 1997. The increase is attributable to additional interest expense
      incurred in connection with the acquisition of the 280 video specialty
      stores. 

      Extraordinary Item

      For the nine months ended October 31, 1997 there was no extraordinary
      item. For the nine months ended October 31, 1996, the Company reported an
      extraordinary item of $0.2 million net of taxes. In conjunction with the
      early extinguishment of a portion of the previously outstanding
      subordinated debt the Company was required by terms of the note upon
      completion of the Offering to pay a prepayment penalty of $400,000.

      Net Income

      As a result of the foregoing, net income decreased $6.8 million, from $1.6
      million of net income for the nine months ended October 31, 1996 to a $5.2
      million net loss for the nine months ended October 31, 1997.

      Certain Factors That May Affect Future Results:

      The following important factors, among others, could cause actual results
      of operations to differ materially from any forward-looking statements
      made in this Quarterly Report on Form 10-Q or any forward-looking
      statements made elsewhere by management of the Company from time to time.

      The Company's rapid growth, particularly its acquisition of 280 video
      specialty stores since May of 1996 and franchising an additional 20
      stores, could strain the Company's ability to manage operations, integrate
      newly acquired stores into its systems, and effectively pursue its growth
      strategy. The Company competes with many others, including Blockbuster
      Entertainment, having significantly greater financial and marketing
      resources, market share, and name recognition than the Company. Further
      developments in competing technologies could have a material adverse
      effect upon the video retail industry and the Company. Industry and
      Company revenues are somewhat seasonal and may be affected by many
      factors, including variation in the acceptance of new release titles
      available for rental and sale, the extent of competition, marketing
      programs, weather, the timing of any holiday weekends, special or unusual
      events, and other factors that may affect retailers in general. There can
      be no assurance that stores already acquired or acquired in future will
      perform as expected or that the prices paid for such stores will prove to
      be advantageous. The costs of integrating newly acquired stores into


                                       14
<PAGE>   15
      RESULTS OF OPERATIONS (continued)

      the Company's systems may vary significantly from the amounts assumed for
      purposes of the Company's pro forma financial statements. Acquisitions of
      stores within the exclusive territories of existing West Coast Video(R)
      franchised stores may require the Company to relocate or sell such
      acquired stores, assist the franchisee to relocate, grant the franchisee
      additional franchises or territorial or other rights, or include the
      franchisee's stores in the Company's intended program of acquisitions. The
      Company's management does not have significant experience in operating a
      company as large as the Company now is. The Company's Common Stock has
      traded publicly only since May 14, 1996 and no prediction can be made as
      to future price levels for such stock.


                                       15
<PAGE>   16
PRO FORMA RESULTS OF OPERATIONS (Note 3)


Three Months ended October 31, 1997 compared to Three Months ended October 31,
1996

Revenues

Pro forma revenues decreased by $0.4 million or 1.3% from $30.4 million for the
three months ended October 31, 1996 to $30.0 million for the three months ended
October 31, 1997. This decrease in revenues was mainly due to the closing of 21
stores (net of new store openings) and a reduction in franchise revenues, offset
by a 2.6% increase in same store sales.

Net Income

Pro forma net income decreased by $3.1 million, from $1.5 million of net income
for the three months ended October 31, 1996 to a $1.6 million net loss for the
three months ended October 31, 1997. This decrease in net income was primarily
attributable to a $0.4 million decrease in revenues in 1997 as compared to the
three months ended October 31, 1996, an increase in rental tape amortization of
$1.5 million caused by the change in the method of amortization as described in
Note 2 coupled with the effects of purchase accounting for the three months
ended October 31, 1996, and a change in the mix of revenues (a decrease in
franchise fees and an increase in merchandise sales) resulting in a $10.9
million increase in cost of sales.

Nine Months ended October 31, 1997 compared to Nine Months ended October 31,
1996

Revenues

Pro forma revenues decreased by $2.1 million, or 2.2%, from $95.3 million for
the nine months ended October 31, 1996 to $93.2 million for the nine months
ended October 31, 1997. This is mainly due to a same store revenues decrease of
1.6% (primarily caused by the impact of weather and the release of titles that
had not performed strongly at the box office) for the nine months ended October
31, 1997 compared to the nine months ended October 31, 1996, a reduction in
franchise fee revenues and the closing of 21 stores (net of new store openings).

Net Income

Pro forma net Income decreased by $10.2 million, from $5.4 million of net income
for the nine months ended October 31, 1996 to $4.8 million net loss for the nine
months ended October 31, 1997. This decrease was primarily due to the $5.1
million write off of costs relating to the debt offering taken during the three
months ended July 31, 1997 and the decrease in revenues of $2.1 million
mentioned above. Another factor in the decreased net income was an increase in
total costs and expenses (excluding interest and other expenses and the debt
offering costs) as a percent of revenues by 10.2 percentage points from 87.6%
for the nine months ended October 31, 1996 to 97.8% for the nine months ended
October 31, 1997. This was mainly due to an increase in store operating costs as
a result of increases in store man hours and payroll and an increase in cost of
goods sold caused by the change in sales mix (a decrease in franchise fees and
an increase in merchandise sales).


                                       16
<PAGE>   17
LIQUIDITY AND CAPITAL RESOURCES


For the nine months ended October 31, 1997, the Company had net cash provided by
operating activities of $16.2 million, net cash used in investing activities of
$47.0 million (consisting primarily of cash used to purchase videocassette
rental inventory of $21.5 million and $22.1 million of net cash paid for the
acquisitions of new video specialty stores acquired in such period) and net cash
provided by financing activities of $32.3 million consisting of $32.2 million of
net borrowings from the Credit Facility (as described below), resulting in a net
increase in cash and cash equivalents of $1.5 million.

During the current fiscal year, the Company has financed its operations
primarily through available operating cash flow and has financed acquisitions
and other capital expenditures through a portion of such operating cash flow and
borrowings under the Credit Facility described in Note 4.

The Company's decision to indefinitely delay its Proposed Private Placement of
debt securities (Note 6) caused certain of the associated costs of such offering
to remain unpaid as of the filing date. The Company has instituted cost-cutting
measures, which included downsizing its general and administrative costs from
the levels reached in contemplation of expansion along with cost reductions at
the regional and store levels. The effects of these changes were partially
reflected in the financial results of the three months ended October 31, 1997
and should be fully realized in future quarterly financial results. The Company
is also currently seeking to find a new participant in order to increase the
amount of borrowings available under the Credit Facility by $5.0 million, in
order to improve its working capital position, bring its payables more current,
upgrade management information systems, continue the conversion of acquired
stores to West Coast Video(R) signage and fixtures, relocate existing stores and
build new stores. While there can be no assurance, the Company expects these
modifications, together with its current operating cash flow, to be sufficient
to support its current operations over the next year.

In the future, the Company may also seek additional debt refinancing or equity
capital through additional private or public offerings of securities. The
availability of debt refinancing or equity capital will depend upon prevailing
market conditions, the market price of the Company's Common Stock and other
factors over which the Company has no control, as well as the Company's
financial condition and results of operations. The number of shares of Common
Stock, if any, to be issued to sellers in connection with future acquisitions
will also be affected by such factors, since such number will be determined in
accordance with a formula based on trading prices of the Common Stock. It is not
expected that funds will be available in sufficient amounts to finance the
acquisitions or opening of video specialty stores at rates comparable to the
Company's recent rates of growth.

Capital Commitments. The remaining aggregate costs of upgrading West Coast's
management information systems and integrating stores acquired in prior
acquisitions onto such systems are expected


                                       17
<PAGE>   18
LIQUIDITY AND CAPITAL RESOURCES (continued)


to be approximately $1.8 million over the next 12 months. Over the next 12
months the Company will make additional payments of cash and Common Stock,
currently estimated for the purpose of the Company's pro forma financial
statements at $0.4 million in the aggregate, to the sellers of six stores
purchased in prior acquisitions at formulaic purchase prices based on certain
financial measurements for such stores in future periods. The Company has
commitments or options to purchase an additional 17 stores at similar formulaic
prices (which cannot yet be estimated), payable in cash.

Subject to the availability of sufficient funds under the Credit Facility, the
Company's capital expenditure plan provides for continuing to convert the stores
acquired in various prior acquisitions to West Coast Video(R) signage and format
and installing certain West Coast layout and features at a rate of up to 100
stores per year at an estimated cost of $35,000 per store; the Company also has
immediate plans to open 5 new stores and relocate up to 3 existing stores.
Build-out costs for new stores are expected to range from $325,000 to $375,000
per store and build-out costs for relocated stores are expected to range from
$175,000 to $225,000 per store. The Company's expansion plans are subject to the
availability of sufficient funds under the Credit Agreement.

Under certain cross-purchase and area development agreements, the Company will
be entitled to acquire (and, subject to certain conditions, will be required to
acquire, if the owners elect to put) all of the assets of up to 55 stores
operated or to be operated by such owners at specified times between 1998 and
2002. In conjunction with such agreements, the Company is subject to puts during
the next 12 months; however there can be no assurance that the puts will be
consummated. The purchase prices will be equal to specified multiples of the
stores' net operating cash flow; the purchase prices of 24 such stores will be
payable in shares of Common Stock and the other purchase prices will be payable
in cash or in shares of Common Stock, at the Company's election.

Rental inventories are treated as noncurrent assets under generally accepted
accounting principles because they are not assets which are reasonably expected
to be completely realized in cash or sold in the normal business cycle. Although
the rental of this inventory generates the major portion of the Company's
revenue, the classification of these assets as noncurrent results in their
exclusion from working capital. The aggregate amount payable for this inventory,
however, is reported as a current liability until paid and, accordingly, is
included in the computation of working capital. Consequently, the Company
believes working capital is not an appropriate measure of its liquidity. Due to
the accounting treatment of rental inventory as a noncurrent asset, the Company
had a working capital deficit at October 31, 1997.


                                       18
<PAGE>   19
                                     PART II
                                OTHER INFORMATION

Item 1.     Legal Proceedings
                  None

Item 2.     Changes in Securities
                  None

Item 3.     Defaults Upon Senior Securities
                  Not Applicable

Item 4.     Submission of Matters to a Vote of the Security Holders
                  None

Item 5.     Other Information
                  None

Item 6.     Exhibits and Reports on Form 8-K

            (a)    Exhibits

                  18.0  -     Letter RE: Change in Accounting Principles

                  27.0  -     Financial Data Schedule


                                       19
<PAGE>   20
                                   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.


                                       WEST COAST ENTERTAINMENT
                                             CORPORATION


Date:  December 15, 1997            By:   /s/ T. Kyle Standley
                                          --------------------
                                    T. Kyle Standley, President and
                                    Chief Executive Officer
                                    (Principal Executive Officer)


Date:  December 15, 1997            By:   /s/ Richard G. Kelly
                                          --------------------
                                    Richard G. Kelly, Chief Financial Officer
                                    (Principal Financial Officer)



Date:  December 15, 1997            By:   /s/ Jerry L. Misterman
                                          ----------------------
                                    Jerry L. Misterman, Chief Accounting Officer
                                    (Principal Accounting Officer)


                                       20