##### Table of Contents



SECURITIES AND EXCHANGE
COMMISSIONWashington, 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 September 30, 2002

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 001-07155

R.H. DONNELLEY CORPORATION

(Exact name of registrant as specified in its charter)


|                                         |  |                                     
|---------------------------------------- |  | ------------------------------------
|Delaware                                 |  | 13-2740040                          
|                                         |  |                                     
|(State of Incorporation)                 |  | (I.R.S. Employer Identification No.)
|                                        
|                                        
|                                        
|                                        
|                                         |  |                                     
|                                        
|                                        
|                                        
|                                        
|One Manhattanville Road, Purchase N.Y    |  | 10577                               
|                                         |  |                                     
|(Address of principal executive offices) |  | (Zip Code)                          

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Sections 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  [  ]

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

|                                     |  |                                       
|------------------------------------ |  | --------------------------------------
|Title of Class                       |  | Shares Outstanding at November 1, 2002
|                                     |  |                                       
|Common Stock, par value $1 per share |  | 29,714,335                            

Commission file number 333-59287

R.H. DONNELLEY INC. *

(Exact name of registrant as specified in its charter)


|                                         |  |                                     
|---------------------------------------- |  | ------------------------------------
|Delaware                                 |  | 36-2467635                          
|                                         |  |                                     
|(State of Incorporation)                 |  | (I.R.S. Employer Identification No.)
|                                        
|                                        
|                                        
|                                        
|One Manhattanville Road, Purchase N.Y    |  | 10577                               
|                                         |  |                                     
|(Address of principal executive offices) |  | (Zip Code)                          

Registrants telephone number, including area code  (914) 933-6400

     R.H. Donnelley Inc. is a wholly owned subsidiary of R.H. Donnelley
Corporation. R.H. Donnelley Inc. meets the conditions set forth in General
Instructions H 1(a) and (b) of Form 10-Q and is therefore filing this report
with respect to R.H. Donnelley Inc. with the reduced disclosure format. R.H.
Donnelley Inc. became subject to the filing requirements of Section 15(d) on
October 1, 1998 in connection with the public offer and sale of its 9 1/8%
Senior Subordinated Notes. As of November 1, 2002, 100 shares of R.H.
Donnelley Inc. common stock, no par value, were outstanding.





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TABLE OF CONTENTS



|                                                   |                                                                                               |                                       |  |  |  |  |  | 
|-------------------------------------------------- | --------------------------------------------------------------------------------------------- | ------------------------------------- |  |  |  |  |  | 
|                                                   |                                                                                               | Consolidated Statements of Operations
|                                                   | Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
|                                                   | Item 3. Quantitative and Qualitative Disclosure About Market Risk                            
|                                                   | Item 4. Controls and Procedures                                                              
|PART II. OTHER INFORMATION                        
|                                                   | Item 1. Legal Proceedings                                                                    
|                                                   | Item 6. Exhibits and Reports on Form 8-K                                                     
|SIGNATURES                                        
|CERTIFICATIONS                                    
|EX-10.30: EMPLOYMENT AGREEMENT                    
|EX-99.1: CERTIFICATION OF CHIEF EXECUTIVE OFFICER 
|EX-99.2: CERTIFICATION / VICE PRESIDENT AND C.F.O.



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##### Table of Contents



R.H. DONNELLEY CORPORATION

INDEX TO FORM 10-Q

|                              |  |                                                                                                       |  |     
|----------------------------- |  | ----------------------------------------------------------------------------------------------------- |  | ----
|                              |  |                                                                                                       |  | PAGE
|                              |  |                                                                                                       |  |     
|PART I. FINANCIAL INFORMATION |  |                                                                                                      
|                             
|                             
|                             
|                             
|Item 1.                       |  | Financial Statements (Unaudited)                                                                      |  |     
|                             
|                             
|                             
|                             
|                              |  | Consolidated Statements of Operations for the three and nine months ended
September 30, 2002 and 2001 |  | 3   
|                             
|                             
|                             
|                             
|                              |  | Consolidated Balance Sheets at September 30, 2002 and December 31, 2001                               |  | 4   
|                             
|                             
|                             
|                             
|                              |  | Consolidated Statements of Cash Flows for the nine months ended
September 30, 2002 and 2001           |  | 5   
|                             
|                             
|                             
|                             
|                              |  | Notes to Consolidated Financial Statements                                                            |  | 6   
|                             
|                             
|                             
|                             
|Item 2.                       |  | Managements Discussion and Analysis of Financial Condition and
Results of Operations                 |  | 13  
|                             
|                             
|                             
|                             
|Item 3.                       |  | Quantitative and Qualitative Disclosure About Market Risk                                             |  | 23  
|                             
|                             
|                             
|                             
|Item 4.                       |  | Controls and Procedures                                                                               |  | 23  
|                             
|                             
|                             
|                             
|PART II. OTHER INFORMATION    |  |                                                                                                      
|                             
|                             
|                             
|                             
|Item 1.                       |  | Legal Proceedings                                                                                     |  | 24  
|                             
|                             
|                             
|                             
|Item 6.                       |  | Exhibits and Reports on Form 8-K                                                                      |  | 26  
|                             
|                             
|                             
|                             
|SIGNATURES                    |  | 32                                                                                                   
|                             
|                             
|                             
|                             
|CERTIFICATIONS                |  | 33                                                                                                   

2



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##### Table of Contents






R.H. Donnelley Corporation and Subsidiaries
Consolidated Statements of Operations (Unaudited)

|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |        |         | 
|--------------------------------------------------------- | ----------------------------------- | ------------------------------------------------- | ------ | ------------------ | ------ | ----------------- | ------ | ------ | ------ | - | ------- | ------ | ------- | - | ------- | ------ | ------- | 
|                                                          |                                     |                                                   |        | Three months ended |        | Nine months ended
|                                                          |                                     |                                                   |        | September 30,      |        | September 30,    
|                                                          |                                     |                                                   |        |                    |        |                  
|(amounts in thousands, except per share data)             |                                     | 2002                                              |        | 2001               |        | 2002              |        | 2001  
|                                                          |                                     |                                                   |        |                    |        |                   |        |       
|Gross revenue                                             |                                     | $                                                 | 21,069 |                    |        | $                 | 20,418 |        |        | $ | 59,116  |        |         | $ | 59,951  |       
|                                                         
|                                                         
|                                                         
|                                                         
|Sales allowances                                          |                                     |                                                   | (131   | )                  |        |                   | 1,747  |        |        |   | (333    | )      |         |   | 1,088   |       
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                          |                                     | Net revenue                                       |        |                    | 20,938 |                   |        |        | 22,165 |   |         |        | 58,783  |   |         |        | 61,039  | 
|                                                         
|                                                         
|                                                         
|                                                         
|Expenses                                                  |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Operating expenses                  |                                                   |        | 11,090             |        |                   |        | 12,502 |        |   |         | 36,351 |         |   |         | 38,346 |        
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | General and administrative expenses |                                                   |        | 3,109              |        |                   |        | 4,054  |        |   |         | 12,273 |         |   |         | 12,807 |        
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Depreciation and amortization       |                                                   |        | 1,553              |        |                   |        | 2,597  |        |   |         | 4,718  |         |   |         | 8,237  |        
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          | Restructuring and special charge    |                                                   |        |                   |        |                   |        |       |        |   |         | 218    |         |   |         |       |        
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                          |                                     | Total expenses                                    |        |                    | 15,752 |                   |        |        | 19,153 |   |         |        | 53,560  |   |         |        | 59,390  | 
|                                                         
|                                                         
|                                                         
|                                                         
|Partnership and joint venture income                      |                                     |                                                   | 40,806 |                    |        |                   | 44,304 |        |        |   | 108,818 |        |         |   | 112,539 |       
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                          |                                     | Operating income                                  |        |                    | 45,992 |                   |        |        | 47,316 |   |         |        | 114,041 |   |         |        | 114,188 | 
|                                                         
|                                                         
|                                                         
|                                                         
|Interest expense, net                                     |                                     |                                                   | 5,106  |                    |        |                   | 6,216  |        |        |   | 16,960  |        |         |   | 18,970  |       
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                          |                                     | Income before income taxes and extraordinary loss |        |                    | 40,886 |                   |        |        | 41,100 |   |         |        | 97,081  |   |         |        | 95,218  | 
|                                                         
|                                                         
|                                                         
|                                                         
|Provision for income taxes                                |                                     |                                                   | 15,740 |                    |        |                   | 15,412 |        |        |   | 37,375  |        |         |   | 35,706  |       
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                          |                                     | Income before extraordinary loss                  |        |                    | 25,146 |                   |        |        | 25,688 |   |         |        | 59,706  |   |         |        | 59,512  | 
|                                                         
|                                                         
|                                                         
|                                                         
|Extraordinary loss, net of tax                            |                                     |                                                   | 87     |                    |        |                   |       |        |        |   | 297     |        |         |   | 348     |       
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                          |                                     | Net income                                        |        | $                  | 25,059 |                   |        | $      | 25,688 |   |         | $      | 59,409  |   |         | $      | 59,164  | 
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|Earnings per share before extraordinary loss              |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          |                                     | Basic                                             |        | $                  | 0.85   |                   |        | $      | 0.86   |   |         | $      | 2.02    |   |         | $      | 1.95    | 
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                          |                                     | Diluted                                           |        | $                  | 0.83   |                   |        | $      | 0.83   |   |         | $      | 1.97    |   |         | $      | 1.91    | 
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|Earnings per share after extraordinary loss               |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          |                                     | Basic                                             |        | $                  | 0.84   |                   |        | $      | 0.86   |   |         | $      | 2.01    |   |         | $      | 1.94    | 
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                          |                                     | Diluted                                           |        | $                  | 0.83   |                   |        | $      | 0.83   |   |         | $      | 1.96    |   |         | $      | 1.89    | 
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|Shares used in computing earnings per share               |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                         
|                                                         
|                                                         
|                                                         
|                                                          |                                     | Basic                                             |        |                    | 29,707 |                   |        |        | 29,979 |   |         |        | 29,618  |   |         |        | 30,454  | 
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                          |                                     | Diluted                                           |        |                    | 30,269 |                   |        |        | 30,817 |   |         |        | 30,262  |   |         |        | 31,230  | 
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|Comprehensive Income:                                     |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|                                                         
|                                                         
|                                                         
|                                                         
|Net income                                                |                                     | $                                                 | 25,059 |                    |        | $                 | 25,688 |        |        | $ | 59,409  |        |         | $ | 59,164  |       
|                                                         
|                                                         
|                                                         
|                                                         
|Unrealized gain (loss) on interest rate swaps, net of tax |                                     |                                                   | 192    |                    |        |                   | (2,237 | )      |        |   | (1,369  | )      |         |   | (4,528  | )     
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       
|Comprehensive income                                      |                                     | $                                                 | 25,251 |                    |        | $                 | 23,451 |        |        | $ | 58,040  |        |         | $ | 54,636  |       
|                                                          |                                     |                                                   |        |                    |        |                   |        |        |        |   |         |        |         |   |         |       

The accompanying notes are an integral part of the consolidated financial
statements.

3



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##### Table of Contents



R.H. Donnelley Corporation and Subsidiaries
Consolidated Balance Sheets (Unaudited)

|                                                |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |              |        |          |   | 
|----------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------- | ---------------------------------------------------- | ------------------------------------------- | ------------------------------------- | ------ | ------------- | - | ------------ | ------ | -------- | - | 
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        | September 30, |   | December 31,
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        | 2002          |   | 2001        
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|(in thousands, except share and per share data) |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                               
|                                               
|                                               
|                                               
|                                                |                                                                                                                                   |                                                      |                                             | Assets                                |        |               |   |              |        |          |   | 
|                                               
|                                               
|                                               
|                                               
|Current Assets                                  |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                               
|                                               
|                                               
|                                               
|                                                | Cash and cash equivalents                                                                                                         |                                                      | $                                           | 9,845                                 |        |               | $ | 14,721       |       
|                                               
|                                               
|                                               
|                                               
|                                                | Accounts
receivable                                                                                                               |                                                      |                                             |                                       |        |               |   |              |       
|                                               
|                                               
|                                               
|                                               
|                                                |                                                                                                                                   | Trade                                                |                                             |                                       | 31,804 |               |   |              | 29,240 |         
|                                               
|                                               
|                                               
|                                               
|                                                |                                                                                                                                   | Other                                                |                                             |                                       | 3,574  |               |   |              | 4,121  |         
|                                               
|                                               
|                                               
|                                               
|                                                |                                                                                                                                   | Allowance for doubtful accounts and sales allowances |                                             |                                       | (4,487 | )             |   |              | (4,189 | )       
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                                |                                                                                                                                   |                                                      | Net accounts receivable                     |                                       |        | 30,891        |   |              |        | 29,172   |  
|                                               
|                                               
|                                               
|                                               
|                                                | Other current assets                                                                                                              |                                                      |                                             | 349                                   |        |               |   | 2,275        |       
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                                |                                                                                                                                   |                                                      | Total current assets                        |                                       |        | 41,085        |   |              |        | 46,168   |  
|                                               
|                                               
|                                               
|                                               
|                                                | Fixed assets and computer software  net                                                                                          |                                                      |                                             | 12,292                                |        |               |   | 14,514       |       
|                                               
|                                               
|                                               
|                                               
|                                                | Partnership and joint venture investments                                                                                         |                                                      |                                             | 207,643                               |        |               |   | 208,989      |       
|                                               
|                                               
|                                               
|                                               
|                                                | Prepaid pension                                                                                                                   |                                                      |                                             | 22,156                                |        |               |   | 20,956       |       
|                                               
|                                               
|                                               
|                                               
|                                                | Other non-current assets                                                                                                          |                                                      |                                             | 7,291                                 |        |               |   | 7,504        |       
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                                |                                                                                                                                   |                                                      | Total Assets                                |                                       | $      | 290,467       |   |              | $      | 298,131  |  
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                                |                                                                                                                                   |                                                      |                                             | Liabilities and Shareholders Deficit |        |               |   |              |        |          |   | 
|                                               
|                                               
|                                               
|                                               
|Current Liabilities                             |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                               
|                                               
|                                               
|                                               
|                                                | Accounts payable and accrued liabilities                                                                                          |                                                      | $                                           | 19,421                                |        |               | $ | 22,368       |       
|                                               
|                                               
|                                               
|                                               
|                                                | Restructuring and other related liabilities                                                                                       |                                                      |                                             | 7,215                                 |        |               |   | 16,357       |       
|                                               
|                                               
|                                               
|                                               
|                                                | Accrued interest payable                                                                                                          |                                                      |                                             | 5,673                                 |        |               |   | 5,163        |       
|                                               
|                                               
|                                               
|                                               
|                                                | Current portion of long-term debt                                                                                                 |                                                      |                                             | 2,259                                 |        |               |   | 2,846        |       
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                                |                                                                                                                                   |                                                      | Total current liabilities                   |                                       |        | 34,568        |   |              |        | 46,734   |  
|                                               
|                                               
|                                               
|                                               
|                                                | Long-term debt                                                                                                                    |                                                      |                                             | 221,991                               |        |               |   | 283,904      |       
|                                               
|                                               
|                                               
|                                               
|                                                | Long-term restructuring liability                                                                                                 |                                                      |                                             | 1,116                                 |        |               |   | 4,934        |       
|                                               
|                                               
|                                               
|                                               
|                                                | Deferred income taxes  net                                                                                                       |                                                      |                                             | 57,377                                |        |               |   | 52,632       |       
|                                               
|                                               
|                                               
|                                               
|                                                | Postretirement and postemployment benefits                                                                                        |                                                      |                                             | 7,322                                 |        |               |   | 7,431        |       
|                                               
|                                               
|                                               
|                                               
|                                                | Other non-current liabilities                                                                                                     |                                                      |                                             | 12,804                                |        |               |   | 13,809       |       
|                                               
|                                               
|                                               
|                                               
|Commitments and contingencies                   |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                               
|                                               
|                                               
|                                               
|Shareholders Deficit                           |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                               
|                                               
|                                               
|                                               
|                                                | Preferred stock, par value $1 per share, authorized 
10,000,000 shares; outstanding  none                                       |                                                      |                                             |                                      |        |               |   |             |       
|                                               
|                                               
|                                               
|                                               
|                                                | Common stock, par value $1 per share, authorized 
400,000,000 shares; issued  51,621,894 shares for 2002 and 2001, respectively |                                                      |                                             | 51,622                                |        |               |   | 51,622       |       
|                                               
|                                               
|                                               
|                                               
|                                                | Additional paid-in capital                                                                                                        |                                                      |                                             | 39,639                                |        |               |   | 32,043       |       
|                                               
|                                               
|                                               
|                                               
|                                                | Unamortized restricted stock                                                                                                      |                                                      |                                             | (387                                  | )      |               |   | (336         | )     
|                                               
|                                               
|                                               
|                                               
|                                                | Retained earnings (deficit)                                                                                                       |                                                      |                                             | 30,539                                |        |               |   | (28,870      | )     
|                                               
|                                               
|                                               
|                                               
|                                                | Treasury stock, at cost, 21,909,070 shares for 2002 and 22,231,910 shares for 2001                                                |                                                      |                                             | (164,755                              | )      |               |   | (163,442     | )     
|                                               
|                                               
|                                               
|                                               
|                                                | Accumulated other comprehensive loss                                                                                              |                                                      |                                             | (1,369                                | )      |               |   | (2,330       | )     
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                                |                                                                                                                                   |                                                      | Total shareholders deficit                 |                                       |        | (44,711       | ) |              |        | (111,313 | )
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             
|                                                |                                                                                                                                   |                                                      | Total Liabilities and Shareholders Deficit |                                       | $      | 290,467       |   |              | $      | 298,131  |  
|                                                |                                                                                                                                   |                                                      |                                             |                                       |        |               |   |             

The accompanying notes are an integral part of the consolidated financial
statements.

4



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##### Table of Contents



R.H. Donnelley Corporation and Subsidiaries
Consolidated Statements of Cash Flows (Unaudited)

|                                                                           |              |                                                        |                                           |        |                   |         |         |        |        |          |  
|-------------------------------------------------------------------------- | ------------ | ------------------------------------------------------ | ----------------------------------------- | ------ | ----------------- | ------- | ------- | ------ | ------ | -------- | -
|                                                                           |              |                                                        |                                           |        | Nine months ended
|                                                                           |              |                                                        |                                           |        | September 30,    
|                                                                           |              |                                                        |                                           |        |                  
|(amounts in thousands)                                                     |              | 2002                                                   |                                           | 2001  
|                                                                           |              |                                                        |                                           |       
|Cash Flows from Operating Activities                                       |              |                                                        |                                           |        |                   |         |         |       
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Net income                                                                 |              | $                                                      | 59,409                                    |        |                   | $       | 59,164  |       
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Reconciliation of net income to net cash provided by operating activities: |              |                                                        |                                           |        |                   |         |         |       
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           |              | Extraordinary loss, net of tax                         |                                           |        | 297               |         |         |        | 348    |         
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           |              | Depreciation and amortization                          |                                           |        | 4,718             |         |         |        | 8,237  |         
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           |              | Deferred income tax                                    |                                           |        | 4,745             |         |         |        | (2,132 | )       
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           |              | Provision for doubtful accounts                        |                                           |        | 2,528             |         |         |        | 2,492  |         
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           |              | Other noncash charges                                  |                                           |        | 1,047             |         |         |        | 869    |         
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           |              | Cash in excess of partnership and joint venture income |                                           |        | 1,346             |         |         |        | 2,206  |         
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           |              | Increase in accounts receivable                        |                                           |        | (4,247            | )       |         |        | (2,724 | )       
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           |              | (Increase) decrease in other assets                    |                                           |        | (187              | )       |         |        | 1,361  |         
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           |              | Decrease in accounts payable and accrued liabilities   |                                           |        | (13,050           | )       |         |        | (3,197 | )       
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           |              | (Decrease) increase in other non-current liabilities   |                                           |        | (153              | )       |         |        | 1,813  |         
|                                                                           |              |                                                        |                                           |        |                   |         |         |       
|                                                                           |              |                                                        | Net cash provided by operating activities |        |                   | 56,453  |         |        |        | 68,437   |  
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Cash Flows from Investing Activities                                       |              |                                                        |                                           |        |                   |         |         |       
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Additions to fixed assets and computer software                            |              |                                                        | (2,496                                    | )      |                   |         | (3,262  | )     
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Investment in ChinaBig.com Limited                                         |              |                                                        |                                          |        |                   |         | (1,550  | )     
|                                                                           |              |                                                        |                                           |        |                   |         |         |       
|                                                                           |              |                                                        | Cash used in investing activities         |        |                   | (2,496  | )       |        |        | (4,812   | )
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Cash Flows from Financing Activities                                       |              |                                                        |                                           |        |                   |         |         |       
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Repayment of debt                                                          |              |                                                        | (62,500                                   | )      |                   |         | (50,000 | )     
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Purchase of treasury stock                                                 |              |                                                        |                                          |        |                   |         | (58,174 | )     
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Proceeds from employee stock option exercises                              |              |                                                        | 3,667                                     |        |                   |         | 7,082   |       
|                                                                           |              |                                                        |                                           |        |                   |         |         |       
|                                                                           |              |                                                        | Net cash used in financing activities     |        |                   | (58,833 | )       |        |        | (101,092 | )
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Decrease in cash and cash equivalents                                      |              |                                                        | (4,876                                    | )      |                   |         | (37,467 | )     
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Cash and cash equivalents, beginning of year                               |              |                                                        | 14,721                                    |        |                   |         | 55,437  |       
|                                                                           |              |                                                        |                                           |        |                   |         |         |       
|Cash and cash equivalents, end of period                                   |              | $                                                      | 9,845                                     |        |                   | $       | 17,970  |       
|                                                                           |              |                                                        |                                           |        |                   |         |         |       
|Supplemental Information:                                                  |              |                                                        |                                           |        |                   |         |         |       
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|Cash used to pay:                                                          |              |                                                        |                                           |        |                   |         |         |       
|                                                                          
|                                                                          
|                                                                          
|                                                                          
|                                                                           | Interest     |                                                        | $                                         | 15,565 |                   |         | $       | 18,031 |       
|                                                                           |              |                                                        |                                           |        |                   |         |         |       
|                                                                           | Income taxes |                                                        | $                                         | 26,845 |                   |         | $       | 26,800 |       
|                                                                           |              |                                                        |                                           |        |                   |         |         |       

The accompanying notes are an integral part of the consolidated financial
statements.

5



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##### Table of Contents



R.H. Donnelley Corporation and Subsidiaries
Notes to Consolidated Financial Statements (Unaudited)(amounts in thousands, except per share data)

1.     Basis of Presentation
The interim financial statements have been prepared in accordance with the
instructions to Form 10-Q and should be read in conjunction with the financial
statements and related notes included in our Annual Report on Form 10-K for the
year ended December 31, 2001. The results of interim periods are not
necessarily indicative of results for the full year or any subsequent period.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation of financial position,
results of operations and cash flows at the dates and for the periods presented
have been included. Certain prior year amounts have been reclassified to
conform to the current years presentation.

2.     Significant Accounting Policies
Principles of Consolidation.The consolidated financial statements include the
accounts of the Company and its direct and indirect wholly owned subsidiaries.
All intercompany transactions and balances have been eliminated. The financial
statements of the DonTech Partnership (DonTech), a 50/50 perpetual
partnership with an operating unit of SBC Communications Inc. (SBC), are not
consolidated with our financial statements. See Partnership and Joint Venture
Accounting below.

Revenue Recognition.We earn revenue in the form of commissions from the sale
of advertising on behalf of Sprint Corporation (Sprint) and fees from our
pre-press publishing services. As a sales agent for Sprint, we recognize sales
commission revenue at the time an advertising contract is executed with a
customer. Sales commission revenue is recorded net of potential sales
allowances, which are estimated based on historical experience. Revenue from
pre-press publishing operations is recognized as services are performed. We
recognize no allowances for pre-press publishing services.

Partnership and Joint Venture Accounting.DonTech is accounted for under the
equity method whereby we recognize our 50% share of the net income of DonTech
as partnership and joint venture income (partnership income). Partnership
income also includes revenue participation income from SBC and a priority
distribution on our membership interest in CenDon LLC (CenDon), a joint
venture with Centel Directory Company (Centel), a subsidiary of Sprint.
Revenue participation income and the priority distribution are tied to
advertising sales and recognized when a sales contract is executed with a
customer. Partnership and joint venture investments on the consolidated
balance sheets include our 50% share of the net assets of DonTech, the revenue
participation receivable and the priority distribution receivable.

Trade Receivables.Trade receivables represent sales commissions earned from
the sale of advertising on behalf of Sprint and fees earned for pre-press
publishing services. An allowance for doubtful accounts for sales commissions
is recognized based upon historical experience and subject to contractual
limitations. Receivables for sales commissions are billed to the publisher
upon directory publication and collected in accordance with contractual
provisions, typically in the same month of publication, but no later than nine
months after publication. Receivables for pre-press publishing services are
billed and collected in accordance with the terms of the applicable agreement,
generally a monthly pro rata amount based on the annual contract value. If
actual volumes exceed contracted volumes, an additional amount is billed to the
publisher at year-end.

Pension and Other Postretirement
Benefits.Pension and other postretirement
benefits represent estimated amounts to be paid to employees in the future.
The accounting for benefit costs reflects the recognition of these future costs
over the employees approximate service period based on the terms of the plans
and the investment and funding decisions made. The determination of the future
obligation and the periodic pension and other postretirement benefit costs
requires management to make assumptions regarding the discount rate, return on
retirement plan assets, increase in future compensation and health care cost
trends. Changes in these assumptions can have a significant impact on the
projected benefit obligation, funding requirement and periodic benefit cost.
Our discount rate, which discounts our future obligation to its present value,
is based on rates of return on Aa corporate bonds. The expected rate of return
on plan assets is based on the mix of assets held by the plan and their
historical long-term rates of return. The anticipated

6



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##### Table of Contents



trend of future health care costs is based on historical experience and
external factors.

Concentration of Credit Risk.We maintain significant receivable balances with
SBC and Sprint for revenue participation, priority distribution, sales
commissions and pre-press publishing services fees. We do not currently
foresee a material credit risk associated with these receivables, although
there can be no assurance that full payment will be received on a timely basis.

Income Taxes.We recognize deferred tax assets for items that will give rise
to future tax deductions. A valuation allowance is established where expected
future taxable income does not support the full realization of deferred tax
assets.

3.     Partnership and Joint Venture Income
Partnership income for the three and nine months ended September 30, 2002 and
2001 consisted of the following:

|                                     |                      |   |                    |        |                   |   |        |        |      |   |         |        |  |   |         |        | 
|------------------------------------ | -------------------- | - | ------------------ | ------ | ----------------- | - | ------ | ------ | ---- | - | ------- | ------ |  | - | ------- | ------ | 
|                                     |                      |   | Three months ended |        | Nine months ended
|                                     |                      |   | September 30,      |        | September 30,    
|                                     |                      |   |                    |        |                  
|                                     |                      |   | 2002               |        | 2001              |   | 2002   |        | 2001
|                                     |                      |   |                    |        |                   |   |        |        |     
|Revenue participation income         |                      | $ | 27,784             |        |                   | $ | 31,252 |        |      | $ | 77,084  |        |  | $ | 81,417  |       
|                                    
|                                    
|                                    
|                                    
|50% share of DonTech net income      |                      |   | 6,646              |        |                   |   | 7,762  |        |      |   | 15,878  |        |  |   | 16,681  |       
|                                     |                      |   |                    |        |                   |   |        |        |      |   |         |        |  |   |         |       
|                                     | Total DonTech income |   |                    | 34,430 |                   |   |        | 39,014 |      |   |         | 92,962 |  |   |         | 98,098 | 
|                                    
|                                    
|                                    
|                                    
|Priority distribution income         |                      |   | 6,376              |        |                   |   | 5,290  |        |      |   | 15,856  |        |  |   | 14,441  |       
|                                     |                      |   |                    |        |                   |   |        |        |      |   |         |        |  |   |         |       
|Partnership and joint venture income |                      | $ | 40,806             |        |                   | $ | 44,304 |        |      | $ | 108,818 |        |  | $ | 112,539 |       
|                                     |                      |   |                    |        |                   |   |        |        |      |   |         |        |  |   |         |       

Summarized combined financial information of DonTech is shown in the table
below.

|                 |  |                    |        |                   |  |      |        |      |  |   |        |  |  |   |        | 
|---------------- |  | ------------------ | ------ | ----------------- |  | ---- | ------ | ---- |  | - | ------ |  |  | - | ------ | 
|                 |  | Three months ended |        | Nine months ended
|                 |  | September 30,      |        | September 30,    
|                 |  |                    |        |                  
|                 |  | 2002               |        | 2001              |  | 2002 |        | 2001
|                 |  |                    |        |                   |  |      |        |     
|Net revenue      |  | $                  | 29,098 |                   |  | $    | 32,644 |      |  | $ | 81,383 |  |  | $ | 85,422 | 
|                
|                
|                
|                
|Operating income |  |                    | 13,249 |                   |  |      | 15,441 |      |  |   | 31,846 |  |  |   | 33,096 | 
|                
|                
|                
|                
|Net income       |  |                    | 13,291 |                   |  |      | 15,524 |      |  |   | 31,755 |  |  |   | 33,362 | 

Total assets of DonTech were $131,558 and $138,667 at September 30, 2002 and
2001, respectively.

4.     Debt
Debt at September 30, 2002 consisted of $74,250 outstanding under the Senior
Secured Term Facilities (Term Facilities) and $150,000 Senior Subordinated
9-1/8% Notes. We also have a Senior Revolving Credit Facility (the Revolver),
which allows us to borrow up to $100,000. There were no outstanding borrowings
under the Revolver at September 30, 2002. During the quarter and nine-month
period ended September 30, 2002, we prepaid $20,000 and $62,500 of Term
Facilities, respectively. An after-tax extraordinary loss associated with the
write-off of related deferred financing costs of $87 and $297 was recognized in
the three and nine-month period ended September 30, 2002, respectively.

5.     Restructuring and Special Charge
In December 2001, a restructuring and special charge of $18,556 was recorded in
connection with executive management transition arrangements and restructuring
actions, including the relocation and consolidation of real estate facilities
and the elimination of approximately 100 positions associated with the
expiration in December 2002 of a pre-press publishing contract. As a result of
the pending business acquisition of Sprint Publishing & Advertising (SPA),
certain restructuring costs that management intended to incur have been
delayed. However, managements current intention is to still incur such costs,
subject to further consideration as the closing of the SPA acquisition draws
closer. At such time, management may determine that certain costs may not be
incurred and, if so, will reverse the accrual for those costs at that
time (see Note 10).
Activity in the restructuring and other related liability account through
September 30, 2002 is

7



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##### Table of Contents



presented in the table below. There were no layoffs related to the
restructuring plan through September 30, 2002.

|                                    |  |            |         |           |  |            |       |            |  |       |       |       |  |   |     |   |  |   |         |  
|----------------------------------- |  | ---------- | ------- | --------- |  | ---------- | ----- | ---------- |  | ----- | ----- | ----- |  | - | --- | - |  | - | ------- | -
|                                    |  | Executive  |         |           |  |            |       |            |  |       |       | Asset |  |   |     |  
|                                    |  | Management |         | Other     |  | Facilities |       | Write-offs |  |       |       |      
|                                    |  | Transition |         | Severance |  | Related    |       | and Other  |  | Total
|                                    |  |            |         |           |  |            |       |            |  |      
|Restructuring and special charge    |  | $          | 9,937   |           |  | $          | 3,252 |            |  | $     | 4,380 |       |  | $ | 987 |   |  | $ | 18,556  |  
|                                   
|                                   
|                                   
|                                   
|Reclass of related liabilities      |  |            | 2,735   |           |  |            |      |            |  |       |      |       |  |   |    |   |  |   | 2,735   |  
|                                    |  |            |         |           |  |            |       |            |  |       |       |       |  |   |     |   |  |   |         |  
|Balance at January 1, 2002          |  |            | 12,672  |           |  |            | 3,252 |            |  |       | 4,380 |       |  |   | 987 |   |  |   | 21,291  |  
|                                   
|                                   
|                                   
|                                   
|2002 activity                       |  |            |         |           |  |            |       |            |  |       |       |       |  |   |     |   |  |   |         |  
|                                   
|                                   
|                                   
|                                   
|Payments                            |  |            | (12,961 | )         |  |            | (128  | )          |  |       |      |       |  |   | (89 | ) |  |   | (13,178 | )
|                                   
|                                   
|                                   
|                                   
|Current
period expense (income) (1) |  |            | 289     |           |  |            |      |            |  |       |      |       |  |   | (71 | ) |  |   | 218     |  
|                                    |  |            |         |           |  |            |       |            |  |       |       |       |  |   |     |   |  |   |         |  
|Balance at September 30, 2002       |  | $          |        |           |  | $          | 3,124 |            |  | $     | 4,380 |       |  | $ | 827 |   |  | $ | 8,331   |  
|                                    |  |            |         |           |  |            |       |            |  |       |       |       |  |   |     |   |  |   |         |  
|Short-term                          |  | $          |        |           |  | $          | 2,891 |            |  | $     | 3,527 |       |  | $ | 797 |   |  | $ | 7,215   |  
|                                   
|                                   
|                                   
|                                   
|Long-term                           |  |            |        |           |  |            | 233   |            |  |       | 853   |       |  |   | 30  |   |  |   | 1,116   |  
|                                    |  |            |         |           |  |            |       |            |  |       |       |       |  |   |     |   |  |   |         |  
|Total                               |  | $          |        |           |  | $          | 3,124 |            |  | $     | 4,380 |       |  | $ | 827 |   |  | $ | 8,331   |  
|                                    |  |            |         |           |  |            |       |            |  |       |       |       |  |   |     |   |  |   |         |  



---

|(1) |  | Represents amounts paid in excess of (lower than) the amounts originally
provided for in the 2001 restructuring and special charge.
|--- |  | -----------------------------------------------------------------------------------------------------------------------------------

6.     Earnings Per Share
The computation of basic and diluted earnings per share for income before
extraordinary loss and net income for the three and nine months ended September
30, 2002 and 2001 was as follows:

|                                                    |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |   |        |  
|--------------------------------------------------- | ------- | -------------------------------- | ------ | ------------------ | ------ | ----------------- | ------ | ---- | ------ | ---- | ------ | - | ------ | - | ------ | - | ------ | -
|                                                    |         |                                  |        | Three months ended |        | Nine months ended
|                                                    |         |                                  |        | September 30,      |        | September 30,    
|                                                    |         |                                  |        |                    |        |                  
|                                                    |         |                                  |        | 2002               |        | 2001              |        | 2002 |        | 2001
|                                                    |         |                                  |        |                    |        |                   |        |      |        |     
|Income before extraordinary loss                    |         | $                                | 25,146 |                    |        | $                 | 25,688 |      |        | $    | 59,706 |   |        | $ | 59,512 |  
|                                                   
|                                                   
|                                                   
|                                                   
|Extraordinary loss, net of taxes                    |         |                                  | 87     |                    |        |                   |       |      |        |      | 297    |   |        |   | 348    |  
|                                                    |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |  
|Net income                                          |         | $                                | 25,059 |                    |        | $                 | 25,688 |      |        | $    | 59,409 |   |        | $ | 59,164 |  
|                                                    |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |  
|Weighted average shares of common stock outstanding |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |  
|                                                   
|                                                   
|                                                   
|                                                   
|                                                    |         | Basic shares                     |        |                    | 29,707 |                   |        |      | 29,979 |      |        |   | 29,618 |   |        |   | 30,454 |  
|                                                   
|                                                   
|                                                   
|                                                   
|                                                    |         | Dilutive effect of stock options |        |                    | 562    |                   |        |      | 838    |      |        |   | 644    |   |        |   | 776    |  
|                                                    |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |  
|                                                    |         | Diluted shares (1)               |        |                    | 30,269 |                   |        |      | 30,817 |      |        |   | 30,262 |   |        |   | 31,230 |  
|                                                    |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |  
|Earnings per share                                  |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |  
|                                                   
|                                                   
|                                                   
|                                                   
|                                                    | Basic   |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |   |       
|                                                   
|                                                   
|                                                   
|                                                   
|                                                    |         | Income before extraordinary loss |        | $                  | 0.85   |                   |        | $    | 0.86   |      |        | $ | 2.02   |   |        | $ | 1.95   |  
|                                                   
|                                                   
|                                                   
|                                                   
|                                                    |         | Extraordinary loss, net of taxes |        |                    | (0.01  | )                 |        |      | (0.00  | )    |        |   | (0.01  | ) |        |   | (0.01  | )
|                                                    |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |  
|                                                    |         | Net income                       |        | $                  | 0.84   |                   |        | $    | 0.86   |      |        | $ | 2.01   |   |        | $ | 1.94   |  
|                                                    |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |  
|                                                    | Diluted |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |   |       
|                                                   
|                                                   
|                                                   
|                                                   
|                                                    |         | Income before extraordinary loss |        | $                  | 0.83   |                   |        | $    | 0.83   |      |        | $ | 1.97   |   |        | $ | 1.91   |  
|                                                   
|                                                   
|                                                   
|                                                   
|                                                    |         | Extraordinary loss, net of taxes |        |                    | (0.00  | )                 |        |      | (0.00  | )    |        |   | (0.01  | ) |        |   | (0.02  | )
|                                                    |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |  
|                                                    |         | Net income                       |        | $                  | 0.83   |                   |        | $    | 0.83   |      |        | $ | 1.96   |   |        | $ | 1.89   |  
|                                                    |         |                                  |        |                    |        |                   |        |      |        |      |        |   |        |   |        |  



---

|(1) |  | The computation of weighted average diluted shares for the three and
nine months ended September 30, 2002 excludes options to purchase 546 and
181 shares, respectively, because the effect would have been antidilutive.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

7.     Business Segments
Our reportable operating segments are DonTech and Directory Advertising
Services (DAS). We evaluate the

8



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##### Table of Contents



performance of DonTech and DAS primarily based on operating income
contribution. The DonTech segment includes revenue participation income and
our 50% interest in the net profits of DonTech (see Note 3), but does not
include an allocation of certain expenses incurred to support this business.
Our DAS segment includes revenue and income from our sales agency and joint
venture relationships with affiliates of Sprint, our pre-press publishing
services operation, all information technology cost and an
allocation of certain shared expenses based on estimated business usage.
General & Corporate represents overhead and administrative costs not allocated
to the DAS business units. Interest expense, interest income, income tax
expense and other non-operating items are not allocated to the operating
segments. Segment information for the three and nine months ended September
30, 2002 and 2001 is as follows:

|                                      |  |                     |         |          |  |             |        |           |  |                     |         |   |  |   |      |   |  |   |         | 
|------------------------------------- |  | ------------------- | ------- | -------- |  | ----------- | ------ | --------- |  | ------------------- | ------- | - |  | - | ---- | - |  | - | ------- | 
|                                      |  |                     |         |          |  | Directory   |        |           |  |                     |         |   |  |   |      |   |  |  
|                                      |  |                     |         |          |  | Advertising |        | General & |  |                     |         |   |  |   |      |  
|                                      |  | DonTech Partnership |         | Services |  | Corporate   |        | Other (1) |  | Consolidated Totals
|                                      |  |                     |         |          |  |             |        |           |  |                    
|Three Months Ended September 30, 2002 |  |                     |         |          |  |             |        |           |  |                     |         |   |  |   |      |   |  |   |         | 
|                                     
|                                     
|                                     
|                                     
|Net revenue                           |  |                     |        |          |  | $           | 20,938 |           |  |                     |        |   |  |   |     |   |  | $ | 20,938  | 
|                                     
|                                     
|                                     
|                                     
|Operating income (loss)               |  | $                   | 34,430  |          |  |             | 14,005 |           |  | $                   | (2,443  | ) |  |   |     |   |  |   | 45,992  | 
|                                     
|                                     
|                                     
|                                     
|Depreciation and amortization         |  |                     |        |          |  |             | 1,488  |           |  |                     | 65      |   |  |   |     |   |  |   | 1,553   | 
|                                     
|                                     
|                                     
|                                     
|EBITDA (2)                            |  |                     | 34,430  |          |  |             | 15,493 |           |  |                     | (2,378  | ) |  |   |     |   |  |   | 47,545  | 
|                                     
|                                     
|                                     
|                                     
|Total assets                          |  |                     | 190,798 |          |  |             | 39,588 |           |  |                     | 60,081  |   |  |   |     |   |  |   | 290,467 | 
|                                     
|                                     
|                                     
|                                     
|Three Months Ended September 30, 2001 |  |                     |         |          |  |             |        |           |  |                     |         |   |  |   |      |   |  |   |         | 
|                                     
|                                     
|                                     
|                                     
|Net revenue                           |  |                     |        |          |  | $           | 22,165 |           |  |                     |        |   |  |   |     |   |  | $ | 22,165  | 
|                                     
|                                     
|                                     
|                                     
|Operating income (loss)               |  | $                   | 39,014  |          |  |             | 11,790 |           |  | $                   | (3,488  | ) |  |   |     |   |  |   | 47,316  | 
|                                     
|                                     
|                                     
|                                     
|Depreciation and amortization         |  |                     |        |          |  |             | 2,465  |           |  |                     | 132     |   |  |   |     |   |  |   | 2,597   | 
|                                     
|                                     
|                                     
|                                     
|EBITDA (2)                            |  |                     | 39,014  |          |  |             | 14,255 |           |  |                     | (3,356  | ) |  |   |     |   |  |   | 49,913  | 
|                                     
|                                     
|                                     
|                                     
|Total assets                          |  |                     | 201,918 |          |  |             | 42,852 |           |  |                     | 79,745  |   |  |   |     |   |  |   | 324,515 | 
|                                     
|                                     
|                                     
|                                     
|Nine Months Ended September 30, 2002  |  |                     |         |          |  |             |        |           |  |                     |         |   |  |   |      |   |  |   |         | 
|                                     
|                                     
|                                     
|                                     
|Net revenue                           |  |                     |        |          |  | $           | 58,783 |           |  |                     |        |   |  |   |     |   |  | $ | 58,783  | 
|                                     
|                                     
|                                     
|                                     
|Operating income (loss)               |  | $                   | 92,962  |          |  |             | 31,589 |           |  | $                   | (10,292 | ) |  | $ | (218 | ) |  |   | 114,041 | 
|                                     
|                                     
|                                     
|                                     
|Depreciation and amortization         |  |                     |        |          |  |             | 4,505  |           |  |                     | 213     |   |  |   |     |   |  |   | 4,718   | 
|                                     
|                                     
|                                     
|                                     
|EBITDA (2)                            |  |                     | 92,962  |          |  |             | 36,094 |           |  |                     | (10,079 | ) |  |   | (218 | ) |  |   | 118,759 | 
|                                     
|                                     
|                                     
|                                     
|Nine Months Ended September 30, 2001  |  |                     |         |          |  |             |        |           |  |                     |         |   |  |   |      |   |  |   |         | 
|                                     
|                                     
|                                     
|                                     
|Net revenue                           |  |                     |        |          |  | $           | 61,039 |           |  |                     |        |   |  |   |     |   |  | $ | 61,039  | 
|                                     
|                                     
|                                     
|                                     
|Operating income (loss)               |  | $                   | 98,099  |          |  |             | 27,326 |           |  | $                   | (11,237 | ) |  |   |     |   |  |   | 114,188 | 
|                                     
|                                     
|                                     
|                                     
|Depreciation and amortization         |  |                     |        |          |  |             | 7,712  |           |  |                     | 525     |   |  |   |     |   |  |   | 8,237   | 
|                                     
|                                     
|                                     
|                                     
|EBITDA (2)                            |  |                     | 98,099  |          |  |             | 35,038 |           |  |                     | (10,712 | ) |  |   |     |   |  |   | 122,425 | 



---

|(1) |  | Represents expenses incurred in connection with the 2001 restructuring
and special charge. These expenses exceeded the amounts provided for and
are therefore treated as a period expense (see also Note 5).                                                                                                                                                                                                                                                   
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|   
|   
|   
|(2) |  | EBITDA represents earnings before interest, taxes and depreciation and
amortization. EBITDA is not a measurement of operating performance
computed in accordance with generally accepted accounting principles and
should not be considered as a substitute for operating income or net
income prepared in conformity with generally accepted accounting
principles. In addition, EBITDA may not be comparable to similarly titled
measures of other companies.

We also evaluate DonTech and DAS based on advertising sales because, while
these sales do not appear on our financial statements or the financial
statements of DonTech, they are a critical measure of performance reviewed by
management and play an important role in managements decision in allocating
financial resources. For a discussion of advertising sales, see Managements
Discussion and Analysis of Financial Condition and Results of Operations 
Results of Operations.

8.     Litigation
Rockland Yellow Pages.In 1999, Sandy Goldberg, Dellwood Publishing, Inc. and
Rockland Yellow Pages (as plaintiffs) initiated a lawsuit against the Company
and Bell Atlantic Corporation (as defendants) in the United States District
Court for the Southern District of New York. The Rockland Yellow Pages is a
proprietary directory that competes against a Bell Atlantic directory in the
same region, for which we served as Bell Atlantics advertising sales agent
through June 30, 2000. The complaint alleged that the defendants disseminated
false information concerning the Rockland Yellow Pages, which resulted in
damages to the Rockland Yellow Pages. In May 2001, the District Court
dismissed substantially all of plaintiffs claims, and in August 2001, the
remaining claims were either withdrawn by the
plaintiffs or dismissed by the District Court. The plaintiffs then filed a
complaint against the same defendants in New

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York State Supreme Court, in
Rockland County, alleging virtually the same state law tort claim previously
dismissed by the District Court and seeking unspecified damages. In October
2001, defendants filed a motion to dismiss this complaint. On May 5, 2002, the
Court granted defendants motion to dismiss the complaint. Plaintiffs have
filed an appeal of this dismissal. Nonetheless, we presently do not believe
that the final outcome of this matter will have a material adverse effect on
our results of operations or financial condition.

Information Resources.In 1996, Information Resources, Inc. (IRI) filed a
complaint in the United States District Court for the Southern District of New
York, naming The Dun & Bradstreet Corporation (D&B), ACNielsen Company and
IMS International Inc., at the time of the filing, all wholly owned
subsidiaries of D&B, as defendants (the IRI Action). IRI alleges, among
other things, various violations of the antitrust laws, including alleged
violations of Sections 1 and 2 of the Sherman Act. The complaint also alleges
a claim of tortious interference with a contract and a claim of tortious
interference with a prospective business relationship. These claims relate to
the acquisition by defendants of Survey Research Group Limited (SRG). IRI
alleges SRG violated an alleged agreement with IRI when it agreed to be
acquired by the defendants and that the defendants induced SRG to breach that
agreement. IRI is seeking damages in excess of $350,000, which amount IRI
seeks to treble under antitrust laws. IRI is also seeking punitive damages of
an unspecified amount. No trial date has been set and discovery is ongoing.
Under the definitive agreement entered into in connection with our separation
from D&B in 1998 (the Distribution Agreement), D&B assumed the defense and
agreed to indemnify us against any payments that we may be required to make,
including related legal fees. As required by the Distribution Agreement,
Moodys Corporation, which subsequently separated from D&B, agreed to be
jointly and severally liable with D&B for the indemnity obligation to us. At
this stage in the proceedings, we are unable to predict the outcome of this
matter. While no assurances can be provided, we currently believe that D&B and
Moodys have sufficient financial resources and borrowing capacity to reimburse
us for any payments we make and related costs we incur.

Tax Matters.Certain tax planning strategies entered into by D&B are
currently subject to review by tax authorities. As a result of the form of our
separation from D&B, we are the corporate successor of, and technically the
taxpayer referred to below as D&B. However, under the terms of the
Distribution Agreement and the Tax Allocation Agreement with D&B, D&B agreed to
assume the defense and to indemnify us for any tax liability that may be
assessed and any related costs and expenses we incur. Also, as required by the
Distribution Agreement, Moodys Corporation is jointly and severally liable
with D&B for the indemnity obligation to us. Under the terms of a series of
agreements between D&B, IMS Health Incorporated (IMS) and Nielsen Media
Research, Inc. (NMR) (both former subsidiaries of D&B), D&B is required to
pay the first $137,000 of any tax liability and accrued interest assessed by
the tax authorities with respect to certain tax matters (including those
discussed in detail below), as well as other tax liabilities. Any amount in
excess of $137,000 will be paid 50% by IMS and NMR jointly and severally and
50% by D&B.

In 2000, D&B filed an amended tax return with respect to the utilization of
capital losses in 1989 and 1990 in response to a formal IRS assessment. The
amended tax return reflected an additional $561,600 of tax and interest due.
In 2000, D&B paid the IRS $349,300 while IMS (on behalf of itself and NMR) paid
the IRS approximately $212,300. We understand that this payment was made under
dispute in order to stop additional interest from accruing, that D&B is
contesting the IRSs formal assessment and would also contest the assessment of
amounts, if any, in excess of the amounts paid, and that D&B has filed a
petition for a refund in the United States District Court. This case is
expected to go to trial in 2004.

In connection with that IRS assessment and amended tax return, IMS has filed an
arbitration proceeding against NMR claiming that NMR subsequently underpaid to
IMS its proper allocation of the above-referenced tax liability under the
agreements between NMR and IMS, to which neither D&B nor we are party. IMS has
included us as a respondent in the arbitration proceeding so that if NMR
prevails in its interpretation of the allocation computation, then IMS could
apply that same interpretation of the allocation computation against us under
its agreement with us (as successor to D&B). The arbitration panel has ruled
that we are a proper party to the arbitration. Hearings before the arbitration
panel on the merits are scheduled for December 2002. As required by the
Distribution Agreement and Tax Allocation Agreement, D&B and Moodys are
defending us in this arbitration proceeding at their cost and expense. If NMR
prevails in the arbitration against IMS and in turn IMS prevails against us, we
believe that our additional liability under this alternative interpretation of
the allocation

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computation would be approximately $15,000 (a $60,000 gross
claim
offset by approximately $45,000 of tax benefit). While we believe that the
original interpretation of the allocation computation is correct and the claims
of IMS are without merit, if NMR prevails against IMS and in turn IMS prevails
against us in this arbitration proceeding, D&B and Moodys would be jointly and
severally obligated to indemnify us against any such liability.

We believe that the fact that D&B and IMS have already paid the IRS a
substantial amount of additional taxes with respect to the contested tax
planning strategies significantly mitigates our risk. While no assurances can
be given, we currently believe that D&B and Moodys have sufficient financial
resources and borrowing capacity to reimburse us for any payments we make and
related costs we incur.

During the second quarter of 2002, D&B received a Notice of Proposed Adjustment
from the IRS with respect to a transaction entered into in 1993. In this
Notice, the IRS proposed to disallow certain royalty expense deductions claimed
by D&B on its 1994, 1995 and 1996 tax returns. The IRS previously concluded an
audit of this transaction for taxable years 1993 and 1994 and did not disallow
any similarly claimed deductions. We understand that D&B disagrees with the
position taken by the IRS in its Notice and has filed a responsive brief to
this effect with the IRS. If the IRS were to issue a formal assessment
consistent with the Notice, then a payment of the disputed amounts would be
required if D&B opted to challenge the assessment in U.S. District Court rather
than in U.S. Tax Court. In the event of such a challenge by D&B, the required
payment by D&B to the IRS would be up to $42,000 (net of $6,000 of associated
tax benefit). In recent communications between D&B and the IRS, we understand
that the IRS has expressed some willingness to withdraw its proposed
disallowance of certain royalty expense deductions of $7,500 for 1994.
However, we also understand that the IRS has expressed its intent to seek
penalties of $7,500 for 1995 and 1996 based on its interpretation of applicable
law. We are advised that D&B would challenge the IRS interpretation. Again,
as required by the Distribution Agreement and Tax Allocation Agreement, D&B and
Moodys are required to joint and severally indemnify us against any such
liability.

We understand that the IRS has sought certain documentation from D&B with
respect to a transaction entered into in 1997 that produces amortization
expense deductions for D&B. While D&B believes the deductions are appropriate,
it is possible that the IRS may challenge them and issue an assessment. If the
IRS were to prevail in its challenge, D&B estimates that its liability to the
IRS (including possible penalties) could be up to $41,000 (net of $3,000 of
associated tax benefit). This transaction is scheduled to expire in 2012 and
unless earlier terminated by D&B, the exposure would increase approximately
$1,700 per quarter as additional amortization expenses are deducted. Again, as
required by the Distribution Agreement and Tax Allocation Agreement, D&B and
Moodys are required to joint and severally indemnify us against any such
liability.

As a result of our assessment of our exposure in these matters, especially in
light of the indemnity arrangements with D&B and Moodys, no material amounts
have been accrued in the consolidated financial statements for any of these
matters.

Other matters.We are also involved in other legal proceedings, claims and
litigation arising in the ordinary conduct of our business. Although there can
be no assurances, we currently believe that the outcome of such legal
proceedings will not have a material adverse effect on our results of
operations or financial condition.

9.     New Accounting Pronouncements

In April 2002, the Financial Accounting Standards Board (FASB) issued FAS
145, Rescission of FASB Statements No. 4, 44, and 64, Amendment of FASB
Statement No. 13, and Technical Corrections. This Statement, among other
things, changes the way gains and losses from the extinguishment of debt are
reported. Previously, all gains and losses from the extinguishment of debt
were required to be reported as an extraordinary item, net of related tax
effect. Under FAS 145, gains and losses from the extinguishment of debt should
be reported as part of on-going operations, unless the extinguishment of debt
is both an unusual and infrequent event for the entity. Previously reported
extraordinary gains and losses from the extinguishment of debt that are not
unusual or infrequent should be reclassified. This Statement is effective
January 1, 2003. Upon adoption of this Statement, previously reported
extraordinary loss will be reclassified to non-operating expense and tax
expense. The adoption of this Statement will not impact our previously
reported net income. Had we adopted this Statement during the third quarter of
2002, non-operating expense for the nine months ended September 30, 2002 and
2001 would have been $482 and $557 higher, and provision for income
taxes would have been lower by $185 and $209, respectively.

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In June 2002, the FASB issued FAS 146, Accounting for Costs Associated with
Exit or Disposal Activities. FAS 146 addresses the accounting and reporting
for costs associated with exit or disposal activities and nullifies Emerging
Issues Task Force Issue 94-3, Liability Recognition for Certain Employee
Termination Benefits and Other Costs to Exit an Activity (including Certain
Costs Incurred in a Restructuring). This Statement is effective for
transactions initiated after December 31, 2002 and is to be applied
prospectively.

10.     Pending Business Combination

On September 21, 2002, we entered into a stock purchase agreement with Sprint
and Centel Directories LLC to acquire SPA for $2,230,000 in cash, subject to a
working capital adjustment. SPA is the yellow pages directory operation of
Sprint, which publishes 260 yellow pages directories in 18
states. The acquisition of SPA is expected to close in the first quarter of
2003, subject to certain regulatory approvals and customary closing conditions.
As part of the transaction, we have received commitments from Deutsche Bank,
Salomon Smith Barney and Bear Stearns to finance the purchase price and
refinance existing debt. In addition, GS Capital Partners 2000, L.P. and
affiliated entities (Goldman Sachs), the primary private equity investment
funds of Goldman, Sachs & Co., have entered into a definitive agreement with us
to invest $200,000 through the purchase of newly issued cumulative convertible
preferred stock and warrants. The transaction, which would close simultaneously
with the SPA acquisition, is subject to customary regulatory approvals and
closing conditions.

As part of the transaction, we and/or certain affiliates will enter into
commercial agreements with Sprint and/or its affiliates under which we will be
the exclusive directory publisher for Sprint in the markets in which Sprint
currently provides local telephone service for an initial term of 50 years
(subject to customary early termination provisions).

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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Information

Certain statements contained in this Form 10-Q regarding R.H. Donnelleys
future operating results, performance, business plans or prospects and any
other statements not constituting historical fact are forward-looking
statements subject to the safe harbor created by the Private Securities
Litigation Reform Act of 1995. Where possible, words such as believe,
expect, anticipate, should, will, would, planned, estimated,
potential, goal, outlook, could, and similar expressions, are used to
identify such forward-looking statements. All forward-looking statements
reflect only our current beliefs and assumptions with respect to our future
results, business plans, and prospects, and are based solely on information
currently available to us. Accordingly, these statements are subject to
significant risks and uncertainties and our actual results, business plans and
prospects could differ significantly from those expressed in, or implied by,
these statements. We caution readers not to place undue reliance on, and we
undertake no obligation to update, any forward-looking statements. Such risks
and uncertainties include, without limitation, the following:

(1)  Dependence on a Limited Number of Relationships
Our business consists primarily of two relationships; a perpetual partnership
with SBC Communications Inc. (SBC) called DonTech; and two sales agency
arrangements with Sprint Corporation (Sprint), which expire in 2004 and 2010.
Due to the limited number of relationships, a material decline in the results
of one relationship, especially our SBC relationship, would likely have a
material adverse effect on our overall operating results. In the event the
acquisition of Sprint Publishing & Advertising (SPA) is not consummated, we
cannot assure you that we will be able to renew our existing Sprint sales
agency or various pre-press publishing agreements as they expire or that we
will be able to secure additional business to replace these contracts as they
expire. Any such failure to renew or replace these contracts would likely have
a material adverse effect on our financial condition and results of operations.

(2)  Dependence on our Business Partners
DonTech is the exclusive sales agent for SBCs yellow pages directories in
certain markets and we are the exclusive sales agent for Sprints yellow pages
directories in certain markets. SBC and Sprint are the publishers of these
directories. As the exclusive sales agent, DonTech and we are responsible for
the management of our respective sales forces, including compensation,
recruiting, training and other sales related matters. As the publisher, SBC
and Sprint have responsibility for and control over all other matters,
including, without limitation, product development, pricing, scheduling,
marketing, distribution, billing, collections, credit and customer service.
While we believe that DonTechs and our economic interests are generally
aligned with those of SBC and Sprint with respect to their yellow pages
directory operations, SBC or Sprint could implement policies or decisions (in
which DonTech or we would likely have little or no participation or influence),
and/or perform their obligations in a manner that could have a material adverse
effect on our results of operations or financial condition and, potentially, on
our relationship with our business partners. DonTech and we are afforded
certain protections under the respective agreements, which we believe could
mitigate to a significant degree the adverse effects of such policy changes or
decisions on us. However, we cannot give any assurances that such policy
changes or decisions would not have a material adverse effect on our results of
operations, financial condition or our relationship with our business partners.
Lastly, we maintain large receivable balances from SBC and Sprint, and any
liquidity difficulties that they may experience could materially impact our
results of operations, financial condition and liquidity. We cannot assure you
that the DonTech relationship will remain in full force and effect into
perpetuity, without material modification or at all, or that DonTech and SBC
will perform all of their respective material obligations (particularly payment
obligations) under these agreements or that SBC will not seek to terminate
early these arrangements. Any such termination, material modification of the
agreements or failure by SBC or DonTech to perform their respective material
obligations would have a material adverse effect on our financial condition and
results of operations.

(3)  Uncertainty Regarding Changes in the Industry
Our ability to diversify our business portfolio by providing sales agency,
pre-press publishing or other services to SBC or Sprint in other markets or to
other publishers in the industry may be impacted by uncertainties caused by
consolidation within the telecommunications and independent yellow pages
publishing industries or other changes. Also, most yellow pages directory
publishers provide all sales and publishing functions internally, which could
impact

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our ability to renew or obtain additional outsourcing business from our current
publishers or offer our services to other yellow pages directory publishers.
Our inability to diversify our business portfolio or expand the services we
provide could negatively impact our ability to grow revenues and income and/or
have a material adverse effect on our financial condition and results of
operations. In addition, the effects of the Telecommunications Act of 1996 are
still developing and the ultimate impact of those changes is still uncertain.
The introduction of new products or technologies (including electronic delivery
of directory information) by other companies and/or pricing pressures from
competitors or customers could also adversely affect our results of operations
and financial condition.

(4)  General Economic Factors
Our business results could be adversely affected by the reversal or slow down
of the modest economic recovery presently being experienced in the United
States, especially with respect to the markets in which we operate. In
addition, any residual economic effects of, and uncertainties regarding (i) the
terrorist attacks that occurred on September 11, 2001, (ii) the general
possibility or express threat of similar terrorist or other related disruptive
events, or (iii) the future occurrence of similar terrorist or other related
disruptive events, especially with respect to the major markets in which we
operate that depend heavily upon travel and tourism, could also adversely
affect our business.

(5)  Risks Related to Pending Acquisition
On September 21, 2002, we entered into a stock purchase agreement with Sprint
and Centel Directories LLC to acquire SPA for $2.23 billion in cash, subject to
a working capital adjustment (the Acquisition). SPA is the yellow pages
directory operation of Sprint, which publishes 260 yellow pages
directories in 18 states. The Acquisition is expected to close in the first
quarter of 2003, subject to certain regulatory approvals and customary closing
conditions. Additional risks that could cause forward-looking statements to
differ materially from such statements include, without limitation, the failure
to consummate the Acquisition and related financing, the inability to achieve
synergies in connection with the Acquisition, the incurrence of unexpected
costs in connection with the Acquisition, our high levels of debt following the
Acquisition, our exposure to greater credit risk as publisher of the
directories and risks relating to the integration of Sprints directory
publishing operations and business.

The Acquisition may, if consummated, mitigate certain of the foregoing risks
with respect to our Sprint operations. See The Company  Significant Business
Developments.

The Company

R.H. Donnelley Corporation is a leading independent marketer of yellow pages
advertising services tailored for small and medium-sized businesses. Our
business is currently organized into two reportable operating segments, the
DonTech Partnership (DonTech) and Directory Advertising Services (DAS).
Unless otherwise indicated, the terms Company, we, us and our refer to
R.H. Donnelley Corporation and its direct and indirect wholly owned
subsidiaries. All tabular amounts are presented in millions of dollars.

DonTech
DonTech is a 50/50 perpetual partnership in which the Company and an operating
unit of SBC are the partners. DonTech acts as the exclusive sales agent for
yellow pages directories published by SBC in Illinois and northwest Indiana.
DonTech sells advertising in SBC directories on behalf of SBC and receives a
commission from SBC. Our income associated with DonTech is comprised of two
components, our 50% interest in the net income of DonTech and revenue
participation income received directly from SBC, which is based on a percentage
of DonTech advertising sales. Income from DonTech accounts for a significant
portion of our operating income and a material decline in the advertising sales
of DonTech would likely have a material adverse effect on our results of
operations and financial condition. We also provide certain pre-press
publishing and billing services for those SBC directories, as well as provide
sales related computer applications to DonTech. The fees received for these
services are included in our DAS segment.

Directory Advertising Services
Within our DAS segment, we sell yellow pages advertising in Sprint directories
on behalf of affiliated entities of Sprint, perform pre-press publishing and
related services for yellow pages directories and include all information
technology costs. We are the exclusive sales agent in the greater Orlando,
Florida market (Central Florida) for a subsidiary of Sprint and the exclusive
sales agent in certain Nevada, Florida, Virginia and North Carolina markets for
CenDon LLC (CenDon), a joint venture with Centel Directory Company
(Centel), another subsidiary of Sprint. Other Sprint

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affiliates sell yellow pages advertising in other markets in these states. We
receive a commission on all advertising we sell for Sprint and CenDon and a
priority distribution on our membership interest in CenDon (priority
distribution), which is based on a percentage of CenDon advertising sales. A
material decline in the advertising sales of our Sprint operation could have a
material adverse effect on our results of operations and financial condition.
Our Central Florida sales agency relationship extends through 2004 and our
CenDon sales agency relationship extends through 2010.

The priority distribution was designed to allow us to maintain the same level
of profitability that we would have earned under the predecessor CenDon
Partnership through its scheduled expiration date in 2004. Under the new
agreements, total payments from CenDon (sales commission plus priority
distribution) are expected to average approximately 37% of CenDon advertising
sales through 2004. Starting with sales into 2005 directories, we will not
receive a priority distribution but will receive a supplemental sales
commission for sales into 2005 through 2007 directories. Total payments from
CenDon (sales commission plus supplemental sales commission) in 2005 are
expected to be approximately 35% of CenDon advertising sales and are expected
to decline 4 percentage points per year through 2007. For sales into 2008 
2010 publications, we will receive our base 23% commission on CenDon
advertising sales. Upon consummation of the Acquisition, our sales agency and
CenDon joint venture relationships with affiliates of Sprint would become
intercompany agreements as we would thereafter be the owner of that business
and publisher of the respective directories. See also  Significant Business
Developments below.

We also provide pre-press publishing services under separately negotiated
contracts for the yellow pages directories of Sprint (through 2003) and SBC
(through 2008) for which we and DonTech sell advertising, as well as for an
unaffiliated third party publisher. At the end of this year, the pre-press
publishing agreement with this unaffiliated publisher will expire. As a result
of the restructuring actions announced in 2001, the expiration of this contract
will not have a material adverse effect on our results of operations or
financial condition in the future. Upon consummation of the Acquisition, our
pre-press agreement with an affiliate of Sprint would become an intercompany
agreement as we would thereafter be the owner of that business and publisher of
the respective directories. See also  Significant Business Developments
below.

Significant Business Developments

On September 21, 2002, we entered into a definitive agreement to purchase all
the outstanding capital stock of the entities comprising Sprints directory
publishing business, SPA, for $2.23 billion in cash, subject to a working
capital adjustment. SPA publishes 260 directories in 18 states.
The transaction is expected to close in the first quarter of 2003, subject to
certain regulatory approvals and customary closing conditions.

As part of the transaction, we have
received commitments from Deutsche Bank,
Salomon Smith Barney and Bear Stearns to finance the purchase price and
refinance existing debt. In addition, GS Capital Partners 2000, L.P. and
affiliated entities (Goldman Sachs), the primary private equity investment
funds of Goldman, Sachs & Co., have entered into a definitive agreement with us
to invest $200 million through the purchase of newly issued cumulative
convertible preferred stock and warrants. The transaction, which would close
simultaneously with the SPA acquisition, is subject to customary regulatory
approvals and closing conditions.

We and/or certain affiliates will enter into commercial agreements, which are
effective upon closing, with Sprint and/or its affiliates under which we will
be the exclusive directory publisher for Sprint in the markets in which Sprint
currently provides local telephone service for an initial term of 50 years
(subject to customary early termination provisions).

Critical Accounting Policies

Certain amounts in our financial statements require that management make
assumptions and estimates based on the best available information at that time.
Actual results could vary from these estimates and assumptions. Those
accounting policies that involve assumptions or estimates on our part that
could have a material effect on our results of operations or financial
condition if the actual results differ from our assumptions or estimates are
presented below. Also see Note 2 in Item 1 Financial Statements for
additional information on our accounting policies.

Revenue Recognition.We earn sales commission revenue from the sale of
advertising on behalf of Sprint and fees from our pre-press publishing
services. As a sales agent for Sprint, we recognize sales commission revenue
at the time an

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advertising contract is executed with a customer. Sales commission revenue is
recorded net of potential sales allowances, which are estimated, based on
historical experience. If an advertiser is not satisfied with its yellow page
advertisement (i.e. misspelled business name, incorrect business address or
number, etc.), the publisher may, at its discretion, adjust the contract value.
Since we earn commissions based on the aggregate value of advertising
contracts, our commissions would also be adjusted under those circumstances.
Concurrent with the recognition of sales commission revenue, we recognize a
sales allowance of approximately 1% of sales commission revenue, based on
historical experience. The amount of sales allowance recognized is
subsequently adjusted based on actual results. Historically, the actual amount
of sales allowances has been consistent with our estimates and significant
adjustments have not been made. Revenue from pre-press publishing operations
is recognized as services are performed. We recognize no allowances for
pre-press publishing services.

Trade Receivables.Trade receivables represent sales commissions earned from
the sale of advertising on behalf of Sprint and fees earned for pre-press
publishing services. We establish an allowance for doubtful accounts for sales
commissions based upon historical experience and subject to contractual
limitations. Our exposure to bad debt is capped under the sales agency
agreement with CenDon. We record our bad debt allowance for CenDon sales based
on the cap rate since the actual rate of bad debts has exceeded the capped rate
for the last three years. An increase in the actual bad debt rate will not
have any direct impact on our financial condition or results of operations.
Under the Central Florida sales agency agreement, our exposure to bad debts is
not capped and we estimate our bad debt allowance based on historical
experience. This amount is subject to adjustment based on actual results. On
an annualized basis, a 1% increase in actual bad debts with respect to Central
Florida over the amount originally provided for would increase our consolidated
expenses approximately $0.1 million. Historically, actual bad debts on these
receivables have been consistent with our estimates and significant adjustments
have not been made.

Receivables for sales commissions are billed to the publisher upon directory
publication and collected in accordance with contractual provisions, typically
in the same month of publication, but no later than nine months after
publication. Receivables for pre-press publishing services are billed and
collected in accordance with the terms of the applicable agreement, generally a
monthly pro rata amount based on the annual contract value. If actual volumes
exceed contracted volumes, an additional amount is billed to the publisher at
year-end.

Pension and Other Postretirement Benefits.Pension and other postretirement
benefits represent estimated amounts to be paid to employees in the future.
The accounting for benefit costs reflects the recognition of these future costs
over the employees approximate service period based on the terms of the plans
and the investment and funding decisions made. The determination of the future
obligation and the periodic pension and other postretirement benefit costs
requires management to make assumptions regarding the discount rate, return on
retirement plan assets, increase in future compensation and health care cost
trends. Changes in these assumptions can have a significant impact on the
projected benefit obligation, funding requirement and periodic benefit cost.
Our discount rate, which discounts our future obligation to its present value,
is based on rates of return on Aa corporate bonds. The expected rate of return
on plan assets is based on the mix of assets held by the plan and their
historical long-term rates of return. The anticipated trend of future health
care costs is based on historical experience and external factors.

Concentration of Credit Risk.We maintain significant receivable balances
with SBC and Sprint for revenue participation, priority distribution, sales
commissions and pre-press publishing services fees. We do not currently
foresee a material credit risk associated with these receivables based on SBC
and Sprints past payment history and strong cash flows from their respective
directory operations. However, there can be no assurance that full payment
will continue to be received on a timely basis.

RESULTS OF OPERATIONS
Three and nine months ended September 30, 2002 and 2001

Net Revenue

Revenue is derived entirely from our DAS segment. As a sales agent for Sprint,
we earn commission revenue based on the annual billing value of advertisements
sold for Sprint directories in the period (Sprint calendar sales). We record
our sales commission revenue net of an estimate of our share of allowances
Sprint may give customers for errors. We also earn revenue from our pre-press
publishing services.

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The amount of commission revenue we earn is directly correlated to Sprint
calendar sales recorded during the period. We manage the selling of
advertising on a directory by directory basis and organize each directory into
a sales campaign. A typical sales campaign begins six to eight months and ends
approximately two months before a directory is scheduled to be published.
Therefore, changes in the beginning and ending dates of a sales campaign and
the actual sales recorded at any point during the campaign can vary from one
period to the next. These variations can cause sales commission revenue earned
in the period to be materially different from the prior comparative period.

Net revenue detail for the three and nine months ended September 30, 2002 and
2001 was as follows:

|                                |             |   |      |      |      |   |          |      |          |   |      |      |   |  |      |      |   
|------------------------------- | ----------- | - | ---- | ---- | ---- | - | -------- | ---- | -------- | - | ---- | ---- | - |  | ---- | ---- | --
|                                |             |   | 2002 |      | 2001 |   | $ Change |      | % Change
|                                |             |   |      |      |      |   |          |      |         
|Quarter ended September 30,     |             |   |      |      |      |   |          |      |          |   |      |      |   |  |      |     
|                               
|                               
|                               
|                               
|Sales commissions               |             | $ | 13.1 |      |      | $ | 12.7     |      |          | $ | 0.4  |      |   |  | 3.1  | %   
|                               
|                               
|                               
|                               
|Sales allowances                |             |   | (0.1 | )    |      |   | 1.7      |      |          |   | (1.8 | )    |   |  | n/m  |     
|                                |             |   |      |      |      |   |          |      |          |   |      |      |   |  |      |     
|Net sales commissions           |             |   | 13.0 |      |      |   | 14.4     |      |          |   | (1.4 | )    |   |  | (9.7 | )   
|                               
|                               
|                               
|                               
|Pre-press publishing            |             |   | 7.9  |      |      |   | 7.8      |      |          |   | 0.1  |      |   |  | 1.3  |     
|                                |             |   |      |      |      |   |          |      |          |   |      |      |   |  |      |     
|                                | Net revenue |   | $    | 20.9 |      |   | $        | 22.2 |          |   | $    | (1.3 | ) |  |      | (5.9 | )%
|                                |             |   |      |      |      |   |          |      |          |   |      |      |   |  |      |     
|Nine months ended September 30, |             |   |      |      |      |   |          |      |          |   |      |      |   |  |      |     
|                               
|                               
|                               
|                               
|Sales commissions               |             | $ | 35.2 |      |      | $ | 35.4     |      |          | $ | (0.2 | )    |   |  | (0.6 | )%  
|                               
|                               
|                               
|                               
|Sales allowances                |             |   | (0.3 | )    |      |   | 1.1      |      |          |   | (1.4 | )    |   |  | n/m  |     
|                                |             |   |      |      |      |   |          |      |          |   |      |      |   |  |      |     
|Net sales commissions           |             |   | 34.9 |      |      |   | 36.5     |      |          |   | (1.6 | )    |   |  | (4.4 | )   
|                               
|                               
|                               
|                               
|Pre-press publishing            |             |   | 23.9 |      |      |   | 24.5     |      |          |   | (0.6 | )    |   |  | (2.4 | )   
|                                |             |   |      |      |      |   |          |      |          |   |      |      |   |  |      |     
|                                | Net revenue |   | $    | 58.8 |      |   | $        | 61.0 |          |   | $    | (2.2 | ) |  |      | (3.6 | )%
|                                |             |   |      |      |      |   |          |      |          |   |      |      |   |  |      |     

Net revenue was $20.9 million and $58.8 million for the quarter and nine months
ended September 30, 2002, respectively, compared to $22.2 million and $61.0
million for the quarter and nine months ended September 30, 2001. Commission
revenue from Sprint through September 2002 was slightly below last year as the
economic conditions during the first half of 2002 resulted in many advertisers
reducing the level of advertising spending, deciding not to advertise or not
being allowed to continue to advertise under Sprints credit policy due to
payment delinquency. However, during the third quarter of 2002, we saw
improving economic conditions in certain Sprint markets as evidenced by
increasing advertising renewal rates.

Sales allowances of $1.4 million originally provided for in 2000 and $0.4
million provided for during the first six months of 2001 were reversed in the
third quarter 2001 as these amounts were determined to be no longer required.
Excluding this reversal, sales allowances for the quarter and nine-month period
in 2001 were $0.1 million and $0.3 million, respectively, which were in-line
with the quarter and nine-month period in 2002.

Pre-press publishing revenue for the nine-month period ended September 30, 2002
declined $0.6 million compared to the prior year period as a result of the
newly extended SBC contract.

The table below sets forth the value of advertising that we sold on behalf of
Sprint and the value of advertising that DonTech sold on behalf of SBC during
the periods noted. DonTech manages its selling process in a manner similar to
the manner in which we manage our selling process. Accordingly, the annual
billing value of advertisements sold for SBC directories in the period
(DonTech calendar sales) can vary from one period to the next due to changes
in the beginning and ending dates of a sales campaign and the actual sales
recorded at any point during the campaign. Our commission revenue and priority
distribution income from Sprint is directly correlated to the amount of Sprint
calendar sales and our revenue participation income from SBC is directly
correlated to the amount of DonTech calendar sales. Therefore, a material
change in Sprint calendar sales or DonTech calendar sales would have a material
effect on our results of operations and financial condition.

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|                                |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |      |   
|------------------------------- | ----- | - | ----- | ----- | ---- | - | -------- | ----- | -------- | - | ----- | ----- | - |  | ----- | ---- | --
|                                |       |   | 2002  |       | 2001 |   | $ Change |       | % Change
|                                |       |   |       |       |      |   |          |       |         
|Quarter ended September 30,     |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     
|                               
|                               
|                               
|                               
|DonTech                         |       | $ | 115.1 |       |      | $ | 129.0    |       |          | $ | (13.9 | )     |   |  | (10.8 | )%  
|                               
|                               
|                               
|                               
|DAS                             |       |   | 56.7  |       |      |   | 54.9     |       |          |   | 1.8   |       |   |  | 3.3   |     
|                                |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     
|                                | Total |   | $     | 171.8 |      |   | $        | 183.9 |          |   | $     | (12.1 | ) |  |       | (6.6 | )%
|                                |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     
|Nine months ended September 30, |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     
|                               
|                               
|                               
|                               
|DonTech                         |       | $ | 322.1 |       |      | $ | 337.7    |       |          | $ | (15.6 | )     |   |  | (4.6  | )%  
|                               
|                               
|                               
|                               
|DAS                             |       |   | 152.3 |       |      |   | 153.1    |       |          |   | (0.8  | )     |   |  | (0.5  | )   
|                                |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     
|                                | Total |   | $     | 474.4 |      |   | $        | 490.8 |          |   | $     | (16.4 | ) |  |       | (3.3 | )%
|                                |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     

DonTech calendar sales for the three and nine months ended September 30, 2002
were lower than the corresponding 2001 periods. There were planned changes in
the sales campaign schedules this quarter that resulted in DonTech sales
representatives servicing existing advertisers representing approximately 10%
less revenue in the quarter than last year. Additionally, the current economic
environment, which began affecting DonTech sales in the latter part of 2001,
continues to affect sales in 2002. Advertisers continue to be cautious and are
not increasing their advertising spending and new business sales continue to be
below historical norms, primarily reflecting lack of confidence by consumers in
those markets. Finally, increased competition in the DonTech markets,
especially Chicago, is having an adverse affect on sales results.

Sprint calendar sales (reflected in the DAS segment in the above table) for the
third quarter of 2002 increased over the prior year period as we saw improving
economic conditions in certain Sprint markets as evidenced by increasing
advertising renewal rates. The improvement in the third quarter helped offset
most of the shortfall during the first half of 2002 that resulted from many
advertisers reducing the level of advertising spending, deciding not to
advertise or not being allowed to continue to advertise under Sprints credit
policy due to payment delinquency. The quarter ended September 30, 2002 was
the first quarter in which there has been an increase in Sprint calendar sales
since the second quarter of 2001 due to the difficult economic conditions.

Management also reviews and analyzes the value of advertising sales sold on
behalf of SBC and Sprint in directories that published during the period
(publication sales). We compare publication sales for the period against
publication sales for the same directories published in the prior year period
(a same store sales type metric). A comparison of publication sales from one
period to another gives an indication of underlying sales growth in directories
as this metric removes all the timing issues associated with a sales campaign.
However, publication sales do not have a direct correlation to our reported
revenue or profitability in the indicated period as most, if not all, of these
sales were consummated and reported in prior periods.

If directories that published in the current period are not consistent with
directories published in the comparable prior year period, the prior year
period is adjusted to include only those directories that published during the
current year period. A DonTech directory originally scheduled to publish in
February 2002 was published in December 2001. To conform to the 2002
publication schedule, publication sales for the nine months ended September 30,
2001 were adjusted to remove the value of the February 2001 directory ($28.3
million). Publication sales for the three and nine months ended September 30,
2002 and 2001 were as follows:

|                                |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |      |   
|------------------------------- | ----- | - | ----- | ----- | ---- | - | -------- | ----- | -------- | - | ----- | ----- | - |  | ----- | ---- | --
|                                |       |   | 2002  |       | 2001 |   | $ Change |       | % Change
|                                |       |   |       |       |      |   |          |       |         
|Quarter ended September 30,     |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     
|                               
|                               
|                               
|                               
|DonTech                         |       | $ | 66.7  |       |      | $ | 67.4     |       |          | $ | (0.7  | )     |   |  | (1.0  | )%  
|                               
|                               
|                               
|                               
|DAS                             |       |   | 50.4  |       |      |   | 56.1     |       |          |   | (5.7  | )     |   |  | (10.2 | )   
|                                |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     
|                                | Total |   | $     | 117.1 |      |   | $        | 123.5 |          |   | $     | (6.4  | ) |  |       | (5.2 | )%
|                                |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     
|Nine months ended September 30, |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     
|                               
|                               
|                               
|                               
|DonTech                         |       | $ | 251.4 |       |      | $ | 262.2    |       |          | $ | (10.8 | )     |   |  | (4.1  | )%  
|                               
|                               
|                               
|                               
|DAS                             |       |   | 125.5 |       |      |   | 136.5    |       |          |   | (11.0 | )     |   |  | (8.1  | )   
|                                |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     
|                                | Total |   | $     | 376.9 |      |   | $        | 398.7 |          |   | $     | (21.8 | ) |  |       | (5.5 | )%
|                                |       |   |       |       |      |   |          |       |          |   |       |       |   |  |       |     

Publication sales were down for the three and nine months ended September 30,
2002 compared to last years comparable periods reflecting difficult economic
conditions, especially in the Mid-West, reduced spending by

18



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##### Table of Contents



advertisers, uncertainty and caution in the small business market and increased
competition in the Chicago markets. The decline in publication sales in the
quarter was primarily due to Sprints July Las Vegas directory which declined
over 10% from the prior year. The decline in the nine-month period was
primarily due to SBCs Chicago Consumer directory, which declined about 15% and
Sprints January and July Las Vegas directories, which declined about 10% in
the aggregate.

Partnership and Joint Venture Income

Partnership and joint venture income (partnership income) includes our share
of the net income of DonTech (accounted for under the equity method), revenue
participation income from SBC and the priority distribution on our membership
interest in CenDon LLC. As a sales agent for SBC, DonTech earns commission
revenue based on the annual billing value of advertisements sold for SBC
directories in the period (DonTech calendar sales). DonTechs net income (of
which we recognize 50%) is dependent on DonTech calendar sales. Additionally,
our revenue participation income is directly correlated to the amount of
DonTech calendar sales in the period. Partnership income from our CenDon
relationship consists of the priority distribution on our membership interest
in CenDon LLC. Partnership income for the quarter and nine months ended
September 30, 2002 and 2001 was as follows:

|                                |       |   |      |       |      |   |          |       |          |   |      |      |   |  |       |      |   
|------------------------------- | ----- | - | ---- | ----- | ---- | - | -------- | ----- | -------- | - | ---- | ---- | - |  | ----- | ---- | --
|                                |       |   | 2002 |       | 2001 |   | $ Change |       | % Change
|                                |       |   |      |       |      |   |          |       |         
|Quarter ended September 30,     |       |   |      |       |      |   |          |       |          |   |      |      |   |  |       |     
|                               
|                               
|                               
|                               
|DonTech
Revenue participation   |       | $ | 27.8 |       |      | $ | 31.2     |       |          | $ | (3.4 | )    |   |  | (10.9 | )%  
|                               
|                               
|                               
|                               
|Equity income share             |       |   | 6.6  |       |      |   | 7.8      |       |          |   | (1.2 | )    |   |  | (15.4 | )   
|                                |       |   |      |       |      |   |          |       |          |   |      |      |   |  |       |     
|Total DonTech                   |       |   | 34.4 |       |      |   | 39.0     |       |          |   | (4.6 | )    |   |  | (11.8 | )   
|                               
|                               
|                               
|                               
|CenDon priority distribution    |       |   | 6.4  |       |      |   | 5.3      |       |          |   | 1.1  |      |   |  | 20.8  |     
|                                |       |   |      |       |      |   |          |       |          |   |      |      |   |  |       |     
|                                | Total |   | $    | 40.8  |      |   | $        | 44.3  |          |   | $    | (3.5 | ) |  |       | (7.9 | )%
|                                |       |   |      |       |      |   |          |       |          |   |      |      |   |  |       |     
|Nine months ended September 30, |       |   |      |       |      |   |          |       |          |   |      |      |   |  |       |     
|                               
|                               
|                               
|                               
|DonTech
Revenue participation   |       | $ | 77.1 |       |      | $ | 81.4     |       |          | $ | (4.3 | )    |   |  | (5.3  | )%  
|                               
|                               
|                               
|                               
|Equity income share             |       |   | 15.9 |       |      |   | 16.7     |       |          |   | (0.8 | )    |   |  | (4.8  | )   
|                                |       |   |      |       |      |   |          |       |          |   |      |      |   |  |       |     
|Total DonTech                   |       |   | 93.0 |       |      |   | 98.1     |       |          |   | (5.1 | )    |   |  | (5.2  | )   
|                               
|                               
|                               
|                               
|CenDon priority distribution    |       |   | 15.8 |       |      |   | 14.4     |       |          |   | 1.4  |      |   |  | 9.7   |     
|                                |       |   |      |       |      |   |          |       |          |   |      |      |   |  |       |     
|                                | Total |   | $    | 108.8 |      |   | $        | 112.5 |          |   | $    | (3.7 | ) |  |       | (3.3 | )%
|                                |       |   |      |       |      |   |          |       |          |   |      |      |   |  |       |     

Partnership income was $40.8 million and $108.8 million for the quarter and
nine months ended September 30, 2002, respectively, compared to $44.3 million
and $112.5 million for the quarter and nine months ended September 30, 2001,
respectively. Partnership income from DonTech for the quarter and year-to-date
2002 periods was lower than the corresponding 2001 periods due to lower DonTech
calendar sales. This decline in calendar sales was due to a planned change in
the sales campaign schedule this quarter, a difficult economic environment and
increased competition in the DonTech markets.

During the quarter, we settled CenDon Partnership advertiser receivable issues
for approximately $2.1 million less than the amount provided for to cover
potential losses (the CenDon settlement). The $2.1 million excess accrual
was reversed and applied against the same accounts that the original reserve
was recorded to. Accordingly, $1.0 million of the benefit was included in
CenDon priority distribution income and the remaining $1.1 million benefit was
recognized as a reduction to operating expenses (see  Expenses). We
recorded the original reserve over time as we became aware of relevant facts
and circumstances. The reserve was recorded to two separate accounts based on
the timing of when the reserve was recognized. Excluding the $1.0 million
benefit, priority distribution income for the quarter and year-to-date 2002
periods was slightly higher than the corresponding 2001 periods primarily due a
contractual increase in the priority distribution rate for 2002.

19



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##### Table of Contents



Expenses

|                                 |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |       |   
|-------------------------------- | ----- | - | ---- | ---- | ---- | - | -------- | ---- | -------- | - | ---- | ---- | - |  | ----- | ----- | --
|                                 |       |   | 2002 |      | 2001 |   | $ Change |      | % Change
|                                 |       |   |      |      |      |   |          |      |         
|Quarter ended September 30,      |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |      
|                                
|                                
|                                
|                                
|Operating expenses               |       | $ | 11.1 |      |      | $ | 12.5     |      |          | $ | (1.4 | )    |   |  | (11.2 | )%   
|                                
|                                
|                                
|                                
|G&A expense                      |       |   | 3.1  |      |      |   | 4.1      |      |          |   | (1.0 | )    |   |  | (24.4 | )    
|                                
|                                
|                                
|                                
|D&A expense                      |       |   | 1.6  |      |      |   | 2.6      |      |          |   | (1.0 | )    |   |  | (38.5 | )    
|                                 |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |      
|                                 | Total |   | $    | 15.8 |      |   | $        | 19.2 |          |   | $    | (3.4 | ) |  |       | (17.7 | )%
|                                 |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |      
|Nine months ended September 30,  |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |      
|                                
|                                
|                                
|                                
|Operating expenses               |       | $ | 36.4 |      |      | $ | 38.4     |      |          | $ | (2.0 | )    |   |  | (5.2  | )%   
|                                
|                                
|                                
|                                
|G&A expense                      |       |   | 12.3 |      |      |   | 12.8     |      |          |   | (0.5 | )    |   |  | (3.9  | )    
|                                
|                                
|                                
|                                
|D&A expense                      |       |   | 4.7  |      |      |   | 8.2      |      |          |   | (3.5 | )    |   |  | (42.7 | )    
|                                
|                                
|                                
|                                
|Restructuring and special charge |       |   | 0.2  |      |      |   |         |      |          |   | 0.2  |      |   |  | n/m   |      
|                                 |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |      
|                                 | Total |   | $    | 53.6 |      |   | $        | 59.4 |          |   | $    | (5.8 | ) |  |       | (9.8  | )%
|                                 |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |      

Operating expenses were $11.1 million and $36.4 million for the quarter and
nine months ended September 30, 2002, respectively, compared to $12.5 million
and $38.4 million for the quarter and nine months ended September 30, 2001,
respectively. The decrease in the quarter and nine-month period was primarily
due to the $1.1 million benefit from the CenDon settlement (see  Partnership
and Joint Venture Income). Additionally, the quarter and nine-month 2002
periods benefited from lower salary expense of approximately $0.4 million and
$0.8 million, respectively from lower headcount and less utilization of outside
information technology (IT) contract services at our Raleigh facility.

General and administrative expense was $3.1 million and $12.3 million for the
quarter and nine months ended September 30, 2002, respectively, compared to
$4.1 million and $12.8 million for the quarter and nine months ended September
30, 2001, respectively. The decrease in the quarter was primarily due to lower
salary and benefits expense, mainly associated with the change in executive
management earlier in the year. General and administrative expense for the
year-to-date period was also lower due to the change in executive management
earlier in the year, but partially offset by non-capitalized expenses
of approximately $0.4
million incurred in connection with the pending acquisition of SPA. Certain
expenses to be incurred related to the transaction, such as financial advisory,
legal and accounting fees and other transaction related fees and expenses will
be capitalized as part of the purchase price in accordance with GAAP.

Depreciation and amortization expense was $1.6 million and $4.7 million for the
quarter and nine months ended September 30, 2002, respectively, compared to
$2.6 million and $8.2 million for the quarter and nine months ended September
30, 2001, respectively. The decrease in the quarter and year-to-date periods
was primarily due to the original investment in the Raleigh Information Center
being fully depreciated by the end of 2001.

During 2002, additional expenses of $0.2 million were incurred in connection
with our executive management transition and restructuring plan announced at
the end of 2001 as actual amounts paid exceeded the amounts provided for and
were therefore treated as a period expense.

Operating Income

Operating income for DonTech includes our 50% interest in the net income of
DonTech and revenue participation income, but does not include an allocation of
certain general and administrative expenses incurred to support this business.
Operating income for DAS includes the operating results of each of the included
business units, less an allocation of certain shared expenses based on
estimated business usage. General & Corporate represents overhead and
administrative costs not allocated to the DAS business units. Operating income
by segment was as follows:

|                            |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |      |   
|--------------------------- | ----- | - | ---- | ---- | ---- | - | -------- | ---- | -------- | - | ---- | ---- | - |  | ----- | ---- | --
|                            |       |   | 2002 |      | 2001 |   | $ Change |      | % Change
|                            |       |   |      |      |      |   |          |      |         
|Quarter ended September 30, |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |     
|                           
|                           
|                           
|                           
|DonTech                     |       | $ | 34.4 |      |      | $ | 39.0     |      |          | $ | (4.6 | )    |   |  | (11.8 | )%  
|                           
|                           
|                           
|                           
|DAS                         |       |   | 14.0 |      |      |   | 11.8     |      |          |   | 2.2  |      |   |  | 18.6  |     
|                           
|                           
|                           
|                           
|General & Corporate         |       |   | (2.4 | )    |      |   | (3.5     | )    |          |   | 1.1  |      |   |  | 31.4  |     
|                            |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |     
|                            | Total |   | $    | 46.0 |      |   | $        | 47.3 |          |   | $    | (1.3 | ) |  |       | (2.7 | )%
|                            |       |   |      |      |      |   |          |      |          |   |      |      |   |  |       |     

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|                                 |                          |   |       |       |      |   |          |       |          |   |      |      |   |  |      |      |   
|-------------------------------- | ------------------------ | - | ----- | ----- | ---- | - | -------- | ----- | -------- | - | ---- | ---- | - |  | ---- | ---- | --
|                                 |                          |   | 2002  |       | 2001 |   | $ Change |       | % Change
|                                 |                          |   |       |       |      |   |          |       |         
|                                
|                                
|                                
|                                
|Nine months ended September 30,  |                          |   |       |       |      |   |          |       |          |   |      |      |   |  |      |     
|                                
|                                
|                                
|                                
|DonTech                          |                          | $ | 92.9  |       |      | $ | 98.1     |       |          | $ | (5.2 | )    |   |  | (5.3 | )%  
|DAS                              |                          |   | 31.6  |       |      |   | 27.3     |       |          |   | 4.3  |      |   |  | 15.8 |     
|                                
|                                
|                                
|                                
|General & Corporate              |                          |   | (10.3 | )     |      |   | (11.2    | )     |          |   | 0.9  |      |   |  | 8.0  |     
|                                 |                          |   |       |       |      |   |          |       |          |   |      |      |   |  |      |     
|                                 | Segment Operating Income |   |       | 114.2 |      |   |          | 114.2 |          |   |      |     |   |  |      |     |   
|                                
|                                
|                                
|                                
|Restructuring and special charge |                          |   | (0.2  | )     |      |   |         |       |          |   | (0.2 | )    |   |  | n/m  |     
|                                 |                          |   |       |       |      |   |          |       |          |   |      |      |   |  |      |     
|                                 | Total                    |   | $     | 114.0 |      |   | $        | 114.2 |          |   | $    | (0.2 | ) |  |      | (0.2 | )%
|                                 |                          |   |       |       |      |   |          |       |          |   |      |      |   |  |      |     

Operating income was $46.0 million and $114.0 million for the three and nine
months ended September 30, 2002, respectively, compared to $47.3 million and
$114.2 million for the three and nine months ended September 30, 2001,
respectively. Poor sales results contributed to a decline in operating income
from DonTech for the three and nine-month periods. See Partnership and Joint
Venture Income above for further details of the decrease in DonTech operating
income. DAS income for the three months was higher than the prior year period
due to the CenDon settlement for $2.1 million less than the amount provided to
cover potential losses. DAS income for the nine months increased over the
prior year due to the CenDon settlement and lower depreciation and amortization
expense of $3.2 million as the investment in the Raleigh Information Center was
fully depreciated by the end of 2001. These increases were partially offset by
lower commission revenue of $1.6 million, primarily due to the reversal of
sales allowances in 2001, and lower publishing revenue of $0.6 million.
General & Corporate costs for the quarter and nine-month period decreased from
the prior year periods primarily due to lower salary and benefits expense
resulting from the change in executive management earlier in the year. General
& Corporate for the year-to-date 2002 period includes acquisition-related costs
of approximately $0.4 million.

Interest and Taxes

Net interest expense was $5.1 million and $17.0 million for the quarter and
nine months ended September 30, 2002, respectively, compared to $6.2 million
and $19.0 million for the quarter and nine months ended September 30, 2001,
respectively. The quarter and year-to-date decrease in 2002 was primarily due
to lower average outstanding debt levels as we continue to use excess cash to
prepay our debt.

The effective tax rate for the quarter and nine months ended September 30, 2002
was 38.5% compared to 37.5% for the three and nine months ended September 30,
2001. The increase in the effective tax rate was due to changes in state
apportionment factors.

Extraordinary Loss

In connection with the pre-payment of debt, we recognized an extraordinary loss
in the three and nine month period ended September 30, 2002 and the nine month
period ended September 31, 2001 related to the write-off of deferred financing
costs.

Net Income and Earnings Per Share

Net income for the third quarter 2002 was $25.1 million, or $0.83 per diluted
share compared to net income of $25.7 million, or $0.83 per diluted share for
the second quarter 2001. For the nine month period ended September 30, 2002,
net income was $59.4 million, or $1.96 per diluted share compared to net income
of $59.2 million, or $1.89 per diluted share for the nine month period ended
September 30, 2001.

LIQUIDITY AND CAPITAL RESOURCES

On September 21, 2002, we entered into a definitive agreement to purchase all
of the outstanding capital stock of SPA for $2.23 billion in cash, subject to a
working capital adjustment. We intend to finance the Acquisition and repay
certain existing indebtedness from the proceeds of financing commitments by
Deutsche Bank, Salomon Smith Barney and Bear Stearns. In addition, in
connection with the Acquisition, we will raise $200 million from the issuance
to Goldman Sachs of 8% convertible preferred stock. The convertible preferred
stock will initially be convertible at a price of $24.05, subject to
adjustment, and will earn a cumulative dividend of 8%,

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compounded quarterly, which we can pay
in cash or allow to accrue, at our option. Additionally, warrants
to acquire 1.65 million shares of R.H. Donnelley common stock with an exercise
price equal to the 30-day average of the stock price at closing will be issued
to Goldman Sachs. We will use treasury shares to satisfy the conversion of
Preferred Stock and exercise of the warrants.

Our primary source of liquidity is cash flows from revenue participation,
priority distribution and sales commission payments received from SBC and
Sprint. Additionally, at September 30, 2002, we had available $100 million
under our existing $100 million Senior Revolving Credit Facility (the
Revolver). In the event the Acquisition is not consummated, we believe that
cash flows generated from operations and the available borrowing capacity under
the Revolver will be sufficient to fund our operations and meet our obligations
to our employees, vendors and creditors for the foreseeable future. Our
primary sources of cash flow are directly dependent on the value of advertising
sold and can be impacted by, among other factors, competition in our markets,
general economic conditions and the level of demand for yellow pages
advertising. In the event the Acquisition is not consummated, management
believes that if aggregate advertising sales were to decline by 10%, cash flow
from operations, together with the available borrowing capacity under the
Revolver, would still be sufficient to fund our operations and meet our
obligations to our employees, vendors and creditors for the foreseeable future.
See Forward-Looking Information  Risks Related to Pending Acquisition.

In addition, as the publisher of the respective directories, Sprint and SBC are
responsible for and consequently control many of the critical functions and
decisions that can impact our results and the results of DonTech. While it has
not historically been the case, their respective policies, decisions and
performance of their respective obligations in these areas, in which we have
little or no participation or influence, could have a material adverse effect
on our results of operations or financial condition. See Forward-Looking
Information  Dependence on our Business Partners.

Through September 2002, we generated $56.5 million of cash flow from
operations, $11.9 million less than the $68.4 million generated through
September 2001. During 2002, we made payments of $13.2 million related to the
restructuring and special charge recorded in 2001 (see Note 5 in Item 1
Financial Statements) compared to payments of $8.4 million in 2001 for
severance and other costs related to the disposition of the Bell Atlantic,
Cincinnati and Get Digital Smart businesses in 2000. Also, in 2001 we received
cash of $6.9 million from the CenDon Partnership as the partnership continued
to collect its receivables and distribute cash to the partners,
compared to only $0.2 million in 2002. As a result of the pending business
acquisition of SPA, certain restructuring costs that we intended to incur have
been delayed. Accordingly, cash payments related to the 2001 restructuring and
special charge are expected to be minimal for the remainder of the year.
However, our current intention is to still incur such costs, subject to further
consideration as the closing of the SPA acquisition draws closer. At such
time, we may determine that certain costs may not be incurred and, if so, will
reverse the accrual for those costs at that time.

Cash used in investing activities during the first nine months of 2002 was $2.5
million, which consisted of fixed assets and computer software purchases. Cash
used in investing activities for the prior year period was $4.8 million, which
included a $1.6 million investment in ChinaBig in accordance with our
contractual obligations. This payment represented our final required
investment in ChinaBig. We currently have no material commitments for
investment spending or capital expenditures.

Net cash used in financing activities was $58.8 million through September 2002
compared to $101.1 million through September 2001. The decrease in cash used
for financing activities is primarily due to the repurchase of $58.2 million of
our common stock during the first nine months of 2001 compared to no
repurchases of our common stock during the first nine months of 2002. We
suspended share repurchases under our share repurchase programs earlier in the
year and do not intend to repurchase any of our common stock for the remainder
of the year. Pending the closing of the Acquisition, free cash flow will
either be retained in the business or used to repay debt.




Item 3. Quantitative and Qualitative Disclosure About Market Risk

Risk Management

We borrow funds under our Senior Secured Term Facilities (Term Facilities)
and Revolver at prevailing short-term rates. To mitigate our exposure to
fluctuating short-term interest rates, we have an outstanding interest rate
swap with

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a notional value of $75 million whereby we pay a fixed rate and receive a
variable rate based on 3-month LIBOR.

The outstanding interest rate swap exposes us to credit risk in the event that
we are in a net gain position and the counterparty to the agreement does not,
or cannot meet its obligation. The notional amount is used to measure interest
to be paid or received and does not represent the amount of exposure to credit
loss. The loss would be limited to the amount that would have been received,
if any, over the remaining life of the swap agreement. At September 30, 2002,
we were in a net loss position (see Market Risk Sensitive Instruments below),
and therefore, were not exposed to credit risk. The counterparty to the swap
is a major financial institution and, had we been in a net gain position, we
would expect this counterparty to be able to perform its obligations under the
swap. We use derivative financial instruments for hedging purposes only and
not for trading or speculative purposes.

Market Risk Sensitive Instruments

The interest rate swap has been designated as a cash flow hedge. In accordance
with FAS 133, the fair value of the swap is recognized in other comprehensive
income, a component of shareholders equity. The fair value of the swap was
based on quoted market prices. At September 30, 2002, the unrealized fair
value, which is the difference between what we would have to pay to terminate
the swap, and the book value of the swap, was a loss of $2.2 million ($1.4
million, after tax). This loss was recognized in the consolidated balance
sheet as other non-current liabilities and accumulated other comprehensive
loss, a component of shareholders deficit.




Item 4. Controls and Procedures



|(a) |  | Evaluation of Disclosure Controls and Procedures. Based on their
evaluation, as of a date within 90 days of the filing date of this
Quarterly Report on Form 10-Q, of the effectiveness of the Companys
disclosure controls and procedures (as defined in Rules 13a-14(c) and
15d-14(c) under the Securities Exchange Act of 1934, as amended), the
principal executive officer and principal financial officer of the Company
have each concluded that such disclosure controls and procedures are
effective and sufficient to ensure that information required to be
disclosed by the Company in reports that it files or submits under the
Securities Exchange Act of 1934 is recorded, processed, summarized and
reported within the time periods specified in Securities and Exchange
Commissions rules and forms.
|--- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   
|(b) |  | Changes in internal controls. Subsequent to their evaluation, there have
not been any significant changes in the Companys internal controls or in
other factors that could significantly affect these controls, including
any corrective action with regard to significant deficiencies and material
weaknesses.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        




PART II. OTHER INFORMATION




Item 1. Legal Proceedings

Rockland Yellow Pages.In 1999, Sandy Goldberg, Dellwood Publishing, Inc. and
Rockland Yellow Pages (as plaintiffs) initiated a lawsuit against the Company
and Bell Atlantic Corporation (as defendants) in the United States District
Court for the Southern District of New York. The Rockland Yellow Pages is a
proprietary directory that competes against a Bell Atlantic directory in the
same region, for which we served as Bell Atlantics advertising sales agent
through June 30, 2000. The complaint alleged that the defendants disseminated
false information concerning the Rockland Yellow Pages, which resulted in
damages to the Rockland Yellow Pages. In May 2001, the District Court
dismissed substantially all of plaintiffs claims, and in August 2001, the
remaining claims were either withdrawn by the plaintiffs or dismissed by the
District Court. The plaintiffs then filed a complaint against the same
defendants in New York State Supreme Court, in Rockland County, alleging
virtually the same state law tort claim previously dismissed by the District
Court and seeking unspecified damages. In October 2001, defendants filed a
motion to dismiss this complaint. On May 5, 2002, the Court granted
defendants motion to dismiss the complaint. Plaintiffs have filed an appeal
of this dismissal. Nonetheless, we presently do not believe that the final
outcome of this matter will have a material adverse effect on our results of
operations or financial condition.

Information Resources.In 1996, Information Resources, Inc. (IRI) filed a
complaint in the United States District Court for the Southern District of New
York, naming The Dun & Bradstreet Corporation (D&B), ACNielsen Company and
IMS International Inc., at the time of the filing, all wholly owned
subsidiaries of D&B, as defendants

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(the IRI Action). IRI alleges, among other things, various violations of the
antitrust laws, including alleged violations of Sections 1 and 2 of the Sherman
Act. The complaint also alleges a claim of tortious interference with a
contract and a claim of tortious interference with a prospective business
relationship. These claims relate to the acquisition by defendants of Survey
Research Group Limited (SRG). IRI alleges SRG violated an alleged agreement
with IRI when it agreed to be acquired by the defendants and that the
defendants induced SRG to breach that agreement. IRI is seeking damages in
excess of $350,000, which amount IRI seeks to treble under antitrust laws. IRI
is also seeking punitive damages of an unspecified amount. No trial date has
been set and discovery is ongoing. Under the definitive agreement entered into
in connection with our separation from D&B in 1998 (the Distribution
Agreement), D&B assumed the defense and agreed to indemnify us against any
payments that we may be required to make, including related legal fees. As
required by the Distribution Agreement, Moodys Corporation, which subsequently
separated from D&B, agreed to be jointly and severally liable with D&B for the
indemnity obligation to us. At this stage in the proceedings, we are unable to
predict the outcome of this matter. While no assurances can be provided, we
currently believe that D&B and Moodys have sufficient financial resources and
borrowing capacity to reimburse us for any payments we make and related costs
we incur.

Tax Matters.Certain tax planning strategies entered into by D&B are
currently subject to review by tax authorities. As a result of the form of our
separation from D&B, we are the corporate successor of, and technically the
taxpayer referred to below as D&B. However, under the terms of the
Distribution Agreement and the Tax Allocation Agreement with D&B, D&B agreed to
assume the defense and to indemnify us for any tax liability that may be
assessed and any related costs and expenses we incur. Also, as required by the
Distribution Agreement, Moodys Corporation is jointly and severally liable
with D&B for the indemnity obligation to us. Under the terms of a series of
agreements between D&B, IMS Health Incorporated (IMS) and Nielsen Media
Research, Inc. (NMR) (both former subsidiaries of D&B), D&B is required to
pay the first $137,000 of any tax liability and accrued interest assessed by
the tax authorities with respect to certain tax matters (including those
discussed in detail below), as well as other tax liabilities. Any amount in
excess of $137,000 will be paid 50% by IMS and NMR jointly and severally and
50% by D&B.

In 2000, D&B filed an amended tax return with respect to the utilization of
capital losses in 1989 and 1990 in response to a formal IRS assessment. The
amended tax return reflected an additional $561,600 of tax and interest due.
In 2000, D&B paid the IRS $349,300 while IMS (on behalf of itself and NMR) paid
the IRS approximately $212,300. We understand that this payment was made under
dispute in order to stop additional interest from accruing, that D&B is
contesting the IRSs formal assessment and would also contest the assessment of
amounts, if any, in excess of the amounts paid, and that D&B has filed a
petition for a refund in the United States District Court. This case is
expected to go to trial in 2004.

In connection with that IRS assessment and amended tax return, IMS has filed an
arbitration proceeding against NMR claiming that NMR subsequently underpaid to
IMS its proper allocation of the above-referenced tax liability under the
agreements between NMR and IMS, to which neither D&B nor we are party. IMS has
included us as a respondent in the arbitration proceeding so that if NMR
prevails in its interpretation of the allocation computation, then IMS could
apply that same interpretation of the allocation computation against us under
its agreement with us (as successor to D&B). The arbitration panel has ruled
that we are a proper party to the arbitration. Hearings before the arbitration
panel on the merits are scheduled for December 2002. As required by the
Distribution Agreement and Tax Allocation Agreement, D&B and Moodys are
defending us in this arbitration proceeding at their cost and expense. If NMR
prevails in the arbitration against IMS and in turn IMS prevails against us, we
believe that our additional liability under this alternative interpretation of
the allocation computation would be approximately $15,000 (a $60,000 gross
claim offset by approximately $45,000 of tax benefit). While we believe that
the original interpretation of the allocation computation is correct and the
claims of IMS are without merit, if NMR prevails against IMS and in turn IMS
prevails against us in this arbitration proceeding, D&B and Moodys would be
jointly and severally obligated to indemnify us against any such liability.

We believe that the fact that D&B and IMS have already paid the IRS a
substantial amount of additional taxes with respect to the contested tax
planning strategies significantly mitigates our risk. While no assurances can
be given, we currently believe that D&B and Moodys have sufficient financial
resources and borrowing capacity to reimburse us for any payments we make and
related costs we incur.

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During the second quarter of 2002, D&B received a Notice of Proposed Adjustment
from the IRS with respect to a transaction entered into in 1993. In this
Notice, the IRS proposed to disallow certain royalty expense deductions claimed
by D&B on its 1994, 1995 and 1996 tax returns. The IRS previously concluded an
audit of this transaction for taxable years 1993 and 1994 and did not disallow
any similarly claimed deductions. We understand that D&B disagrees with the
position taken by the IRS in its Notice and has filed a responsive brief to
this effect with the IRS. If the IRS were to issue a formal assessment
consistent with the Notice, then a payment of the disputed amounts would be
required if D&B opted to challenge the assessment in U.S. District Court rather
than in U.S. Tax Court. In the event of such a challenge by D&B, the required
payment by D&B to the IRS would be up to $42,000 (net of $6,000 of associated
tax benefit). In recent communications between D&B and the IRS, we understand
that the IRS has expressed some willingness to withdraw its proposed
disallowance of certain royalty expense deductions of $7,500 for 1994.
However, we also understand that the IRS has expressed its intent to seek
penalties of $7,500 for 1995 and 1996 based on its interpretation of applicable
law. We are advised that D&B would challenge the IRS interpretation. Again,
as required by the Distribution Agreement and Tax Allocation Agreement, D&B and
Moodys are required to joint and severally indemnify us against any such
liability.

We understand that the IRS has sought certain documentation from D&B with
respect to a transaction entered into in 1997 that produces amortization
expense deductions for D&B. While D&B believes the deductions are appropriate,
it is possible that the IRS may challenge them and issue an assessment. If the
IRS were to prevail in its challenge, D&B estimates that its liability to the
IRS (including possible penalties) could be up to $41,000 (net of $3,000 of
associated tax benefit). This transaction is scheduled to expire in 2012 and
unless earlier terminated by D&B, the exposure would increase approximately
$1,700 per quarter as additional amortization expenses are deducted. Again, as
required by the Distribution Agreement and Tax Allocation Agreement, D&B and
Moodys are required to joint and severally indemnify us against any such
liability.

As a result of our assessment of our exposure in these matters, especially in
light of the indemnity arrangements with D&B and Moodys, no material amounts
have been accrued in the consolidated financial statements for any of these
matters.

Other matters.We are also involved in other legal proceedings, claims and
litigation arising in the ordinary conduct of our business. Although there can
be no assurances, we currently believe that the outcome of such legal
proceedings will not have a material adverse effect on our results of
operations or financial condition.




Item 6. Exhibits and Reports on Form 8-K

(a)  Exhibits:

|            |  |                                                                                                                                                                                                                                                             
|----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Document                                                                                                                                                                                                                                                    
|            |  |                                                                                                                                                                                                                                                             
|3.1         |  | Certificate of Incorporation of the Company (incorporated by reference to
Exhibit 3.1 to the Quarterly Report on Form 10-Q for the three months ended
March 31, 1999, Commission File No. 001-07155)                                                        
|           
|           
|           
|           
|3.2         |  | By-laws of the Company (incorporated by reference to Exhibit 3.2 to the
Quarterly Report on Form 10-Q for the three months ended March 31, 1999,
Commission File No. 001-07155)                                                                             
|           
|           
|           
|           
|3.3         |  | Certificate of Incorporation of R.H. Donnelley Inc. (incorporated by
reference to Exhibit 3.3 to Amendment No. 1 to the Registration Statement on
Form S-4, filed with the Securities and Exchange Commission on August 7,
1998, Registration No. 333-59287)
|           
|           
|           
|           
|3.4         |  | By-laws of R.H. Donnelley Inc. (incorporated by reference to Exhibit 3.4 to
the Registration Statement on Form S-4, filed with the Securities and
Exchange Commission on July 17, 1998, Registration No. 333-59287)                                         
|           
|           
|           
|           
|4.1         |  | Indenture dated as of June 5, 1998 between R.H. Donnelley Inc.,
as Issuer,
the Company, as                                                                                                                                                                  

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##### Table of Contents



|            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                        
|----------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Document                                                                                                                                                                                                                                                                                                                                                                                                                               
|            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                        
|            |  | Guarantor, and the Bank of New York, as Trustee, with respect
to the 91/8% Senior Subordinated Notes due 2008 (incorporated by reference to
Exhibit 4.1 to the Registration Statement on Form S-4, filed with the
Securities and Exchange Commission on July 17, 1998, Registration No.
333-59287)                                                                                                                                     
|           
|           
|           
|           
|4.2         |  | Form of the 91/8% Senior Subordinated Notes due 2008 (included in Exhibit 4.1)                                                                                                                                                                                                                                                                                                                                                         
|           
|           
|           
|           
|4.3         |  | Company Guarantee (included in Exhibit 4.1)                                                                                                                                                                                                                                                                                                                                                                                            
|           
|           
|           
|           
|4.4         |  | Rights Agreement, dated as of October 27, 1998 between R.H. Donnelley
Corporation and First Chicago Trust Company (incorporated by reference to
Exhibit 4 to the Registration Statement on Form 8-A, filed with the
Securities and Exchange Commission on November 5, 1998, Registration No.
001-07155)                                                                                                                                
|           
|           
|           
|           
|4.5         |  | Amendment No. 1 to Rights Agreement dated as of February 26, 2001 by and
among R.H. Donnelley Corporation, First Chicago Trust Company of New York (as
initial Rights Agent) and The Bank of New York (as successor Rights Agent)
(incorporated by reference to Exhibit 4.5 to the Annual Report on Form 10-K
for the year ended December 31, 2000, Commission File No. 001-07155)                                                     
|           
|           
|           
|           
|10.1        |  | Form of Distribution Agreement between the Company (f/k/a The Dun &
Bradstreet Corporation) and The New Dun & Bradstreet Corporation
(incorporated by reference to Exhibit 99.2 to the Form 8-K of the Company
(f/k/a The Dun & Bradstreet Corporation), filed on June 30, 1998, Commission
File No. 001-07155)                                                                                                                        
|           
|           
|           
|           
|10.2        |  | Form of Tax Allocation Agreement between the Company (f/k/a The Dun &
Bradstreet Corporation) and The New Dun & Bradstreet Corporation
(incorporated by reference to Exhibit 99.3 to the Form 8-K of the Company
(f/k/a The Dun & Bradstreet Corporation), filed on June 30, 1998, Commission
File No. 001-07155)                                                                                                                      
|           
|           
|           
|           
|10.3        |  | Form of Employee Benefits Agreement between the Company (f/k/a The Dun &
Bradstreet Corporation) and The New Dun & Bradstreet Corporation
(incorporated by reference to Exhibit 99.4 to the Form 8-K of the Company
(f/k/a The Dun & Bradstreet Corporation), filed on June 30, 1998, Commission
File No. 001-07155)                                                                                                                   
|           
|           
|           
|           
|10.4        |  | Form of Intellectual Property Agreement between the Company (f/k/a The Dun &
Bradstreet Corporation) and The New Dun & Bradstreet Corporation
(incorporated by reference to Exhibit 99.5 to the Form 8-K of the Company
(f/k/a The Dun & Bradstreet Corporation), filed on June 30, 1998, Commission
File No. 001-07155)                                                                                                               
|           
|           
|           
|           
|10.5        |  | Form of Amended and Restated Transition Services Agreement between the
Company (f/k/a The Dun & Bradstreet Corporation), The New Dun & Bradstreet
Corporation, Cognizant Corporation, IMS Health Incorporated, ACNielsen
Corporation and Gartner Group, Inc. (incorporated by reference to Exhibit
99.9 to the Form 8-K of the Company (f/k/a The Dun & Bradstreet Corporation),
filed on June 30, 1998, Commission File No. 001-07155)
|           
|           
|           
|           
|10.6        |  | Credit Agreement among the Company, R.H. Donnelley Inc., The Chase Manhattan
Bank, as Administrative Agent and the Lenders party thereto (incorporated by
reference to Exhibit 10.9 to the Registration Statement on Form S-4, filed
with the Securities and Exchange Commission on July 17, 1998, Registration
No. 333-59287)                                                                                                         

26



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##### Table of Contents



|            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Document                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.7        |  | First Amendment to Credit Agreement, dated as of March 4, 1999, among the
Company, R.H. Donnelley Inc., The Chase Manhattan Bank, as Administrative
Agent, and the Lenders party thereto (incorporated by reference to Exhibit
10.1 to the Quarterly Report on Form 10-Q for the three months ended March
31, 1999, Commission File No. 001-07155)                                                                                                                                                                                                                                                        
|           
|           
|           
|           
|10.8        |  | DonTech II Partnership Agreement, effective August 19, 1997, by and between
R.H. Donnelley Inc. (f/k/a The Reuben H. Donnelley Corporation) and Ameritech
Publishing of Illinois, Inc. (incorporated by reference to Exhibit 10.10 to
Amendment No. 1 to the Registration Statement on Form S-4, filed with the
Securities and Exchange Commission on August 7, 1998, Registration No.
333-59287)                                                                                                                                                                                                         
|           
|           
|           
|           
|10.9        |  | Revenue Participation Agreement, dated as of August 19, 1997, by and between
APIL Partners Partnership and R.H. Donnelley Inc. (f/k/a The Reuben H.
Donnelley Corporation) (incorporated by reference to Exhibit 10.11 to
Amendment No. 1 to the Registration Statement on Form S-4, filed with the
Securities and Exchange Commission on August 7, 1998, Registration No.
333-59287)                                                                                                                                                                                                                     
|           
|           
|           
|           
|10.10       |  | Master Agreement, executed August 19, 1997, by and among R.H. Donnelley Inc.
(f/k/a The Reuben H. Donnelley Corporation), the Company (f/k/a The Dun &
Bradstreet Corporation), The Am-Don Partnership a/k/a DonTech, DonTech II,
Ameritech Publishing, Inc., Ameritech Publishing of Illinois, Inc., Ameritech
Corporation, DonTech I Publishing Company LLC and the APIL Partners
Partnership (incorporated by reference to Exhibit 10.12 to Amendment No. 1 to
the Registration Statement on Form S-4, filed with the Securities and
Exchange Commission on August 7, 1998, Registration No. 333-59287)
|           
|           
|           
|           
|10.11       |  | Exclusive Sales Agency Agreement, effective August 19, 1997, between APIL
Partners Partnership and DonTech II (incorporated by reference to Exhibit
10.13 to Amendment No. 1 to the Registration Statement on Form S-4, filed
with the Securities and Exchange Commission on August 7, 1998, Registration
No. 333-59287)                                                                                                                                                                                                                                                                                  
|           
|           
|           
|           
|10.12       |  | Second Amended and Restated Partnership Agreement, effective as of August 19,
1997, by and between R.H. Donnelley Inc. (f/k/a The Reuben H. Donnelley
Corporation) and Ameritech Publishing of Illinois (incorporated by reference
to Exhibit 10.14 to Amendment No. 1 to the Registration Statement on Form
S-4, filed with the Securities and Exchange Commission on August 7, 1998,
Registration No. 333-59287)                                                                                                                                                                                        
|           
|           
|           
|           
|10.13       |  | Agreement for Publishing Services, dated as of January 1, 2002 between
Ameritech Publishing Inc. and R.H. Donnelley Inc. (certain portions of this
exhibit have been omitted and filed separately with the Securities and
Exchange Commission pursuant to an Application for an Order Granting
Confidential Treatment) (incorporated by reference to Exhibit 10.13 to the
Companys Quarterly Report on Form 10-Q for the three months ended March 31,
2002, Commission File No. 001-07155)                                                                                                               
|           
|           
|           
|           
|10.14       |  | Limited Liability Company Agreement of CenDon, L.L.C. dated April 27, 2000
between R.H. Donnelley Inc. and Centel Directory Company (certain portions of
this exhibit have been omitted and filed separately with the Securities and
Exchange Commission pursuant to an Application for an Order Granting
Confidential Treatment) (incorporated by reference to Exhibit 10.14 to the
Companys Quarterly Report on Form 10-Q for the three months ended June 30,
2002, Commission File No. 001-07155)                                                                                                     
|           
|           
|           
|           
|10.15       |  | Sales Agency Agreement dated April 27, 2000 among R.H. Donnelley Inc., Centel
Directory Company and CenDon, L.L.C. (incorporated by reference to Exhibit
10.15 to the Companys Quarterly Report on Form 10-Q for the three months
ended June 30, 2002, Commission File No. 001-07155)                                                                                                                                                                                                                                                                                                                    

27



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##### Table of Contents



|            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Document                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|            |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|10.16       |  | Agreement for Publishing Services dated April 27, 2000 between R.H. Donnelley
and CenDon, L.L.C. (certain portions of this exhibit have been omitted and
filed separately with the Securities and Exchange Commission pursuant to an
Application for an Order Granting Confidential Treatment) (incorporated by
reference to Exhibit 10.16 to the Companys Quarterly Report on Form 10-Q for
the three months ended June 30, 2002, Commission File No. 001-07155)
|           
|           
|           
|           
|10.17^      |  | Key Employees Performance Unit Plan, as amended and restated (incorporated
by reference to Exhibit 10.15 to Amendment No. 3 to the Registration
Statement on Form
S-4, filed with the Securities and Exchange Commission on September 28, 1998,
Registration No. 333-59287)                                                                                                                                                                                      
|           
|           
|           
|           
|10.18^      |  | 1991 Key Employees Stock Option Plan, as amended and restated through April
25, 2000 (incorporated by reference to Exhibit 10.17 to the Companys
Quarterly Report on Form 10-Q for the three months ended September 30, 2000,
Commission File No. 001-07155)                                                                                                                                                                                                    
|           
|           
|           
|           
|10.19^      |  | Amended and Restated 1998 Directors Stock Plan (incorporated by reference to
Exhibit 10.18 to the Companys Annual Report on Form 10-K for the year ended
December 31, 1999, Commission File No. 001-07155)                                                                                                                                                                                                                                                      
|           
|           
|           
|           
|10.20^      |  | Pension Benefit Equalization Plan (incorporated by reference to Exhibit 10.16
to the Companys Annual Report on Form 10-K for the year ended December 31,
2001, Commission File No. 001-07155)                                                                                                                                                                                                                                                                    
|           
|           
|           
|           
|10.21^      |  | 2001 Stock Award and Incentive Plan (incorporated by reference to Exhibit
10.17 to the Companys Annual Report on Form 10-K for the year ended December
31, 2001, Commission File No. 001-07155)                                                                                                                                                                                                                                                                  
|           
|           
|           
|           
|10.22^      |  | 2001 Partner Share Plan (incorporated by reference to Exhibit 99.1 to
Registration Statement on Form S-8, filed with the Securities and Exchange
Commission on April 30, 2001, Registration No. 333-59790)                                                                                                                                                                                                                                                        
|           
|           
|           
|           
|10.23^      |  | Form of Non-Qualified Stock Option Agreement (incorporated by reference to
Exhibit 99.02 to Registration Statement on Form S-8, filed with the
Securities and Exchange Commission on July, 25, 2001, Registration No.
333-65822)                                                                                                                                                                                                                                  
|           
|           
|           
|           
|10.24^      |  | Form of Annual Incentive Program Award (incorporated by reference to Exhibit
99.03 to Registration Statement on Form S-8, filed with the Securities and
Exchange Commission on July, 25, 2001, Registration No. 333-65822)                                                                                                                                                                                                                                        
|           
|           
|           
|           
|10.25^      |  | Form of Performance Unit Program Award (incorporated by reference to Exhibit
99.04 to Registration Statement on Form S-8, filed with the Securities and
Exchange Commission on July, 25, 2001, Registration No. 333-65822)                                                                                                                                                                                                                                        
|           
|           
|           
|           
|10.26^      |  | Deferred Compensation Plan (incorporated by reference to Exhibit 4.01 to the
Companys Registration Statement on Form S-8, filed with the Securities and
Exchange Commission on November 24, 1999, Registration No. 333-91613)                                                                                                                                                                                                                                    
|           
|           
|           
|           
|10.27^      |  | Amended and Restated Employment Agreement dated as of December 27, 2001
between the Company and Frank R. Noonan (incorporated by reference to Exhibit
10.23 to the Companys Annual Report on Form 10-K for the year ended December
31, 2001, Commission File No. 001-07155)                                                                                                                                                                                      

28



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##### Table of Contents



|            |  |                                                                                                                                                                                                                                                                               
|----------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Document                                                                                                                                                                                                                                                                      
|            |  |                                                                                                                                                                                                                                                                               
|10.28^      |  | Amended and Restated Employment Agreement dated as of December 27, 2001
between the Company and Philip C. Danford (incorporated by reference to
Exhibit 10.24 to the Companys Annual Report on Form 10-K for the year ended
December 31, 2001, Commission File No. 001-07155)
|           
|           
|           
|           
|10.29^      |  | Employment Agreement effective as of May 1, 2002 between the Company and
David C. Swanson (incorporated by reference to Exhibit 10.29 to the Companys
Quarterly Report on Form 10-Q for the three months ended June 30, 2002,
Commission File No. 001-07155)                 
|           
|           
|           
|           
|10.30^*     |  | Employment Agreement effective September 21, 2002 between the Company and
Peter J. McDonald.                                                                                                                                                                                  
|           
|           
|           
|           
|10.31^      |  | Employment Agreement effective March 1, 2002 between the Company and Steven
M. Blondy (incorporated by reference to Exhibit 10.30 to the Companys
Quarterly Report on Form 10-Q for the three months ended June 30, 2002,
Commission File No. 001-07155)                     
|           
|           
|           
|           
|10.32^      |  | Employment Agreement dated as of September 28, 1998 between the Company and
Frank M. Colarusso (incorporated by reference to Exhibit 10.32 to the Annual
Report on Form 10-K for the year ended December 31, 2000, Commission File No.
001-07155)                             
|           
|           
|           
|           
|10.33^      |  | Amendment No. 1 to Employment Agreement dated as of July 27, 2000 between the
Company and Frank M. Colarusso (incorporated by reference to Exhibit 10.33 to
the Annual Report on Form 10-K for the year ended December 31, 2000,
Commission File No. 001-07155)               
|           
|           
|           
|           
|10.34^      |  | Amendment No. 2 to Employment Agreement dated as of February 27, 2001 between
the Company and Frank M. Colarusso (incorporated by reference to Exhibit
10.34 to the Annual Report on Form 10-K for the year ended December 31, 2000,
Commission File No. 001-07155)           
|           
|           
|           
|           
|10.35^      |  | Employment Agreement dated as of September 26, 2000 between the Company and
William C. Drexler (incorporated by reference to Exhibit 10.35 to the Annual
Report on Form 10-K for the year ended December 31, 2000, Commission File No.
001-07155)                             
|           
|           
|           
|           
|10.36^      |  | Amendment No. 1 to Employment Agreement dated as of February 27, 2001 between
the Company and William C. Drexler (incorporated by reference to Exhibit
10.36 to the Annual Report on Form 10-K for the year ended December 31, 2000,
Commission File No. 001-07155)           
|           
|           
|           
|           
|10.37^      |  | Employment Agreement dated as of January 1, 2001 between the Company and
Robert J. Bush (incorporated by reference to Exhibit 10.37 to the Annual
Report on Form 10-K for the year ended December 31, 2000, Commission File No.
001-07155)                                    
|           
|           
|           
|           
|10.38^      |  | Amendment No. 1 to Employment Agreement dated as of February 27, 2001 between
the Company and Robert J. Bush (incorporated by reference to Exhibit 10.38 to
the Annual Report on Form 10-K for the year ended December 31, 2000,
Commission File No. 001-07155)               
|           
|           
|           
|           
|10.39^      |  | Separation Agreement and Release dated as of March 15, 2001 between the
Company and Judith A. Norton (incorporated by reference to Exhibit 10.29 to
the Annual Report on Form 10-K for the year ended December 31, 2000,
Commission File No. 001-07155)                       

29



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##### Table of Contents



|            |  |                                                                                                                                                                                                                                                                                                                                   
|----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Document                                                                                                                                                                                                                                                                                                                          
|            |  |                                                                                                                                                                                                                                                                                                                                   
|           
|           
|           
|           
|10.40       |  | Stock Purchase Agreement, dated as of September 21, 2002, by and among R.H.
Donnelley Corporation, Sprint Corporation and Centel Directories LLC
(incorporated by reference to Exhibit 2.1 to the Current Report on Form 8-K
dated October 1, 2002, Commission File No. 001-07155)                                                
|           
|           
|           
|           
|10.41       |  | Preferred Stock and Warrant Purchase Agreement, dated as of September 21,
2002, among R.H. Donnelley Corporation and Goldman Sachs Capital Partners
2000, L.P. and entities affiliated therewith (incorporated by reference to
Exhibit 2.2 to the Current Report on Form 8-K dated October 1, 2002,
Commission File No. 001-07155)
|           
|           
|           
|           
|21          |  | Subsidiaries of the Company (incorporated by reference to Exhibit 21 to the
Annual Report on Form 10-K for the year ended December 31, 2000, Commission
File No. 001-07155)                                                                                                                                                       
|           
|           
|           
|           
|99.1*       |  | Certification of Quarterly Report on Form 10-Q for the period ended September
30, 2002 by David C. Swanson, Chief Executive Officer                                                                                                                                                                                               
|           
|           
|           
|           
|99.2*       |  | Certification of Quarterly Report on Form 10-Q for the period ended September
30, 2002 by Steven M. Blondy, Senior Vice President and Chief Financial
Officer                                                                                                                                                                     



---

| |  | * Filed herewith                          
| |  | ------------------------------------------
|
|
|
|
| |  | ^ Management contract or compensatory plan

30



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##### Table of Contents





| | (b) |  | Reports on Form 8-K:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | --- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| |     |  | On November 8, 2002, the
Company filed a Current Report on Form 8-K, disclosing under
Item 9 that at a conference held on November 7, 2002, a
representative of R.H. Donnelley Corporation stated that the Company
does not intend to repay the outstanding 9 1/8% senior subordinated
notes due 2008 of R.H. Donnelley Inc. in connection with the
financing of the Companys acquisition of the publishing business of
Sprint Corporation.                                                                                                                                                                                                                                                                                                                                                                                                       
|
| |     |  | On November 7, 2002, the Company filed a Current Report on Form 8-K,
disclosing under Item 5 that R.H. Donnelley Inc. intends to offer,
through a subsidiary, $300 million of senior notes and $450 million of
senior subordinated notes to certain institutional investors in an
offering exempt from the registration requirements of the Securities Act
of 1933. Pursuant to Rule 135c of the Securities Act, the Company filed
the press release issued on November 6, 2002 as Exhibit 99.1.                                                                                                                                                                                                                                                                                                                                                   
|
| |     |  | On October 1, 2002, the Company filed a Current Report on Form 8-K,
disclosing under Item 5 that pursuant to a Stock Purchase Agreement,
dated as of September 21, 2002, by and among R.H. Donnelley Corporation,
Sprint Corporation and Centel Directories LLC, the Company will purchase
Sprints directory publishing business (SPA) for $2.23 billion in cash.
The Company also disclosed that Goldman Sachs Capital Partners 2000,
L.P. and affiliated entities have entered into a definitive agreement to
invest $200 million in the Company through the purchase of the Companys
newly issued convertible preferred stock. Goldman Sachs Capital Partners
will also receive warrants to acquire 1.65 million shares of the
Companys common stock with an exercise price equal to the 30-day average
of the common stock at the closing.
|
| |     |  | On September 23, 2002, the Company filed a Current Report on Form 8-K,
disclosing under Item 9 that the Company had posted a slide presentation
on its website titled Creating the Leading Public Stand-Alone U.S.
Directory Company in connection with the Companys public announcement
and related conference call that it had entered into a definitive
agreement to purchase Sprint Corporations directory publishing business.                                                                                                                                                                                                                                                                                                                                                                                                            

31



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##### Table of Contents






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.

|                       |  |     |  |                                                                   
|---------------------- |  | --- |  | ------------------------------------------------------------------
|                       |  |     |  | R.H. DONNELLEY CORPORATION                                        
|                      
|                      
|                      
|                      
|                       |  |     |  |                                                                   
|                      
|                      
|                      
|                      
|Date: November 8, 2002 |  | By: |  | /s/ Steven M. Blondy                                              
|                       |  |     |  |                                                                   
|                       |  |     |  | Steven M. Blondy
Senior Vice President and Chief Financial Officer
|                      
|                      
|                      
|                      
|                       |  |     |  |                                                                   
|                      
|                      
|                      
|                      
|Date: November 8, 2002 |  | By: |  | /s/ William C. Drexler                                            
|                       |  |     |  |                                                                   
|                       |  |     |  | William C. Drexler
Vice President and Controller                  

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.

|                       |  |     |  |                                                                   
|---------------------- |  | --- |  | ------------------------------------------------------------------
|                       |  |     |  | R.H. DONNELLEY INC.                                               
|                      
|                      
|                      
|                      
|                       |  |     |  |                                                                   
|                      
|                      
|                      
|                      
|Date: November 8, 2002 |  | By: |  | /s/ Steven M. Blondy                                              
|                       |  |     |  |                                                                   
|                       |  |     |  | Steven M. Blondy
Senior Vice President and Chief Financial Officer
|                      
|                      
|                      
|                      
|                       |  |     |  |                                                                   
|                      
|                      
|                      
|                      
|Date: November 8, 2002 |  | By: |  | /s/ William C. Drexler                                            
|                       |  |     |  |                                                                   
|                       |  |     |  | William C. Drexler
Vice President and Controller                  

32



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##### Table of Contents






CERTIFICATIONS

I, David C. Swanson, certify that:



| | 1. |  | I have reviewed this quarterly report on Form 10-Q of R.H.
Donnelley Corporation;                                                                                                                                                                                                                                             
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | 2. |  | Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by this quarterly report;
|
| | 3. |  | Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;                   
|
| | 4. |  | The registrants other certifying officers and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for
the registrant and we have:                                                                                                     



| | a) |  | designed such disclosure controls and procedures to
ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in
which this quarterly report is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | evaluated the effectiveness of the registrants
disclosure controls and procedures as of a date within 90 days
prior to the filing date of this quarterly report (the
Evaluation Date); and                                                                                                  
|
| | c) |  | presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls and procedures
based on our evaluation as of the Evaluation Date;                                                                                                                        



| | 5. |  | The registrants other certifying officers and I have
disclosed, based on our most recent evaluation, to the registrants
auditors and the audit committee of the registrants board of
directors or persons performing the equivalent function:
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | a) |  | all significant deficiencies in the design or operation
of internal controls which could adversely affect the
registrants ability to record, process, summarize and report
financial data and have identified for the registrants auditors
any material weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | any fraud, whether or not material, that involves
management or other employees who have a significant role in the
registrants internal controls; and                                                                                                                                        



| | 6. |  | The registrants other certifying officers and I have
indicated in this quarterly report whether or not there were
significant changes in internal controls or in other factors that
could significantly affect internal controls subsequent to the date
of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                       |  |     |  |                                                       
|---------------------- |  | --- |  | ------------------------------------------------------
|Date: November 8, 2002 |  | By: |  | /s/ David C. Swanson                                  
|                       |  |     |  |                                                       
|                       |  |     |  | David C. Swanson
President and Chief Executive Officer

33



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##### Table of Contents



CERTIFICATIONS

I, Steven M. Blondy, certify that:



| | 1. |  | I have reviewed this quarterly report on Form 10-Q of R.H.
Donnelley Corporation;                                                                                                                                                                                                                                             
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | 2. |  | Based on my knowledge, this quarterly report does not contain
any untrue statement of a material fact or omit to state a material
fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading
with respect to the period covered by this quarterly report;
|
| | 3. |  | Based on my knowledge, the financial statements, and other
financial information included in this quarterly report, fairly
present in all material respects the financial condition, results of
operations and cash flows of the registrant as of, and for, the
periods presented in this quarterly report;                   
|
| | 4. |  | The registrants other certifying officers and I are
responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-14 and 15d-14) for
the registrant and we have:                                                                                                     



| | a) |  | designed such disclosure controls and procedures to
ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by
others within those entities, particularly during the period in
which this quarterly report is being prepared;
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | evaluated the effectiveness of the registrants
disclosure controls and procedures as of a date within 90 days
prior to the filing date of this quarterly report (the
Evaluation Date); and                                                                                                  
|
| | c) |  | presented in this quarterly report our conclusions
about the effectiveness of the disclosure controls and procedures
based on our evaluation as of the Evaluation Date;                                                                                                                        
|

| | 5. |  | The registrants other certifying officers and I have
disclosed, based on our most recent evaluation, to the registrants
auditors and the audit committee of the registrants board of
directors or persons performing the equivalent function:
| | -- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|

| | a) |  | all significant deficiencies in the design or operation
of internal controls which could adversely affect the
registrants ability to record, process, summarize and report
financial data and have identified for the registrants auditors
any material weaknesses in internal controls; and
| | -- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
| | b) |  | any fraud, whether or not material, that involves
management or other employees who have a significant role in the
registrants internal controls; and                                                                                                                                        
|

| | 6. |  | The registrants other certifying officers and I have
indicated in this quarterly report whether or not there were
significant changes in internal controls or in other factors that
could significantly affect internal controls subsequent to the date
of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.
| | -- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                       |  |     |  |                                                                   
|---------------------- |  | --- |  | ------------------------------------------------------------------
|Date: November 8, 2002 |  | By: |  | /s/ Steven M. Blondy                                              
|                       |  |     |  |                                                                   
|                       |  |     |  | Steven M. Blondy
Senior Vice President and Chief Financial Officer

34