U.S. SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                   FORM 10-KSB


[X] Annual report pursuant to Section 13 or 15(d) of the Securities Exchange Act
    of 1934

    For the fiscal year ended December 31, 2001.


           Commission file number:  000-29469


                           TERRA NOVA VINEYARDS, INC.
                     --------------------------------------
                   (formerly known as CONSERVATIVE WEST, INC.)
        (Exact name of small business issuer as specified in its charter)


       Nevada                                         86-0972559
(State or other jurisdiction of            (I.R.S. Employer Identification No.)
incorporation or organization)

                11601 East Lusitano Place, Tucson, Arizona 85748
                   ------------------------------------------
               (Address of principal executive office) (Zip Code)

                                 (520) 731-9890
                             ----------------------
                           (Issuer's telephone number)


Securities registered pursuant to Section 12(b) of the Act:   None

Securities  registered pursuant to Section 12(g) of the Act: Common Stock, $.001
par value.

Indicate  by check  mark  whether  the  Registrant:  (1) has filed  all  reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934  during  the  preceding  12 months  (or for such  shorter  period  that the
Registrant was required to file such report(s), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No ___.


Indicate by check mark if disclosure of delinquent  filers  pursuant to Item 405
of Regulation  S-K is not contained  herein,  and will not be contained,  to the
best  of  the  Registrant's   knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part III of this Form  10-KSB or any
amendment to this Form 10-KSB. Yes___ No X.

At December 31, 2001,  the aggregate  market value of all shares of voting stock
held by non-affiliates was $0.00. In determining this figure, the Registrant has
assumed  that  all  directors  and  executive  officers  are  affiliates.   Such
assumption shall not be deemed conclusive for any other purpose. The number of

<PAGE>

shares  outstanding  of each  class  of the  Registrant's  common  stock,  as of
December  31,  2001,  was as follows:  Common  Stock $.001 par value,  3,000,000
shares.

Total revenues for fiscal year ended December 31, 2001: $0

Transitional Small Business Disclosure Format (check one): Yes  ; No X

                                     PART I

ITEM 1.  DESCRIPTION OF BUSINESS

         The Company has not engaged in any operations other than organizational
matters. Terra Nova Vineyards,  Inc., formerly known as Conservative West, Inc.,
a Nevada  corporation (the "Company") was incorporated on July 25, 1997, and was
formed  specifically  to be a "clean public shell" and for the purpose of either
merging  with or  acquiring an  operating  company  with  operating  history and
assets.

         The  primary  activity of the Company  has  involved  and will  involve
seeking  merger  or  acquisition  candidates  with whom it can  either  merge or
acquire. The Company does not intend to limit potential acquisitions  candidates
to any  particular  field  or  industry,  but  does  retain  the  right to limit
acquisition or merger  candidates,  if it so chooses,  to a particular  field or
industry.

         The proposed business activities  described herein classify the Company
as a "blank  check" or "shell  company"  whose  sole  purpose at this time is to
locate  and  consummate  a merger  or  acquisition.  Many  states  have  enacted
statutes, rules and regulations limiting the sale of securities of "blank check"
companies in their respective jurisdictions. Management does not believe it will
undertake  any  efforts to cause a trading  market to  develop in the  Company's
securities  until such time as the  Company  has  successfully  implemented  its
business plan described  herein.  However,  if the Company intends to facilitate
the eventual creation of a public trading market in its outstanding  securities,
it must consider that the Company's securities, when available for trading, will
be subject to a Securities  and Exchange  Commission  rule that imposes  special
sales practice  requirements  upon  broker-dealers  who sell such  securities to
persons other than established customers or accredited  investors.  For purposes
of the  rule,  the  phrase  "accredited  investors"  means,  in  general  terms,
institutions  with assets in excess of $5,000,000,  or individuals  having a net
worth in excess of $1,000,000  or having an annual income that exceeds  $200,000
(or  that,  when  combined  with  a  spouse's  income,  exceeds  $300,000).  For
transactions  covered  by the  rule,  the  broker-dealer  must  make  a  special
suitability  determination for the purchaser and receive the purchaser's written
agreement  to the  transaction  prior to the  sale.  Consequently,  the rule may
affect the ability of broker-dealers  to sell the Company's  securities and also
may affect the ability of purchasers  in this offering to sell their  securities
in any market that might develop.


<PAGE>

         On December  24,  2001 the Company  executed a letter of intent for the
purchase of assets of Anderson's Conn Valley Winery, Inc. and real property used
in the  business  of the  winery.  The  purchase  price of the  winery  and real
property is $10,000,000  cash at closing,  a convertible  promissory note in the
principal amount of $1,200,000, the assumption of debt in the approximate amount
of $4,100,000 and the issuance of promissory notes in the approximate  amount of
$3,400,000. In order to complete the transaction,  the Company must successfully
negotiate and execute a final purchase contract.  Additionally, the Company must
raise sufficient funds for the purchase and operation of the winery. The Company
is currently testing the waters with a private placement,  which, if successful,
would be  utilized  to  finance  the  purchase  of the  winery.  There can be no
assurances that the Company will enter into a final purchase contract or that it
will be able to raise sufficient funds to close the proposed purchase.

Competition

         The Company expects to encounter substantial competition in its efforts
to  locate  attractive   opportunities,   primarily  from  business  development
companies,  venture  capital  partnerships  and  corporations,  venture  capital
affiliates  of  large  industrial  and  financial  companies,  small  investment
companies,   and  wealthy   individuals.   Many  of  these  entities  will  have
significantly greater experience, resources and managerial capabilities than the
Company and will  therefore be in a better  position  than the Company to obtain
access to attractive business opportunities.

Employees

         The Company's only employee at the present time is its sole officer and
director,  who will devote as much time as he  determines  is necessary to carry
out the affairs of the Company.

ITEM 2.  DESCRIPTION OF PROPERTY

         The Company has a working agreement with the Company president to share
use of 600 square feet of office  space,  telephones  and  secretarial  services
supplied on a gratis basis.

ITEM 3.  LEGAL PROCEEDINGS

         No material legal proceedings to which the Company (or its director and
officer in his capacity as such) is party or to which property of the Company is
subject is pending and no such material proceeding is known by management of the
Company to be contemplated.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     None.
<PAGE>

                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER
MATTERS

     There has been no public trading market for the Company's common stock.

Common Stock

The Company is authorized to issue 100,000,000 shares of Common Stock, $.001 par
value per  share,  of which  3,000,000  shares are  issued  and  outstanding  at
December 31, 2001, and 5,000,000  shares of Preferred  Stock, of which no shares
are issued and outstanding as of December 31, 2001

Holders of the Common  Stock are  entitled  to one vote for each share owned for
all matters to be voted on by the shareholders. There is no cumulative voting in
the election of directors. Accordingly, each shareholder is entitled to vote the
number of shares owned by him for as many  persons as there are  directors to be
elected.  Holders of Common Stock are entitled to receive such  dividends as may
be declared  from time to time by the Board of  Directors  out of funds  legally
available therefore and, in the event of liquidation,  dissolution or winding up
of the  Company,  to share  ratably in all  assets  remaining  after  payment of
liabilities.  We have not paid cash  dividends  on our Common  Stock.  It is the
policy of our Board of Directors to retain future earnings to finance the growth
and development of our business.  Any future dividends will be at the discretion
of our Board of Directors and will depend upon our financial condition,  capital
requirements,  earnings, liquidity, and other factors that it may deem relevant.
The holders of Common Stock have no preemptive or conversion rights. The holders
of Common Stock are not subject to further  calls or  assessments.  There are no
redemption or sinking fund provisions applicable to the Common Stock. The rights
of the  holders of the Common  Stock are subject to any rights that may be fixed
for holders of preferred stock,  when and if any preferred stock is issued.  The
Common  Stock  currently  outstanding  is  validly  issued,  fully  paid  and no
assessable.

Recent Sales Of Unregistered Securities.

In  connection  with  organizing  the  Company,  on  November  4, 1997,  persons
consisting of its officers, directors, and other individuals were issued a total
of 1,000  shares of Common  Stock at a value of $.001 per share.  On October 20,
1999, the outstanding shares were forward split 1,000 to 1, resulting in a total
of  1,000,000  shares  outstanding.  On December 26, 2001 the Board of Directors
authorized 2 for 1 stock split for the Company's  common  stock.  As a result of
the split 1,000,000 shares were issued, resulting in a total of 2,000,000 shares
outstanding.  On December 28, 2001, the Company issued 1,000,000 shares pursuant
to a subscription  at the rate of $0.01 per share. As a result of this issuance,
a total amount of 3,000,000  shares were  outstanding  at December 31, 2001. The
Company has issued its stock in reliance  upon  Section  4(2) of the  Securities
Act.

<PAGE>

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS OR PLAN OF OPERATION

         The  following  discussion  should  be read  in  conjunction  with  the
Financial Statements and notes thereto.

OPERATIONS

         The Company  intends to seek,  investigate  and, if such  investigation
warrants, acquire an interest in one or more business opportunities presented to
it by persons or firms who or which  desire to seek  perceived  advantages  of a
publicly held corporation.

         The Company  will not  restrict  its search to any  specific  business,
industry or geographical location, and the Company may participate in a business
venture of virtually any kind or nature. The discussion of the proposed business
under this caption and throughout is purposefully general and is not meant to be
restrictive of the Company's  virtually  unlimited  discretion to search for and
enter into potential business opportunities.

         The Company is currently  party to a letter of intent,  dated  December
24, 2001, to purchase of assets of Anderson's Conn Valley Winery,  Inc. and real
property  used in the business of the winery.  The purchase  price of the winery
and real property is $10,000,000 cash at closing, a convertible  promissory note
in the principal amount of $1,200,000, the assumption of debt in the approximate
amount of  $4,100,000  and the issuance of promissory  notes in the  approximate
amount of  $3,400,000.  In order to complete the  transaction,  the Company must
successfully negotiate and execute a final purchase contract.  Additionally, the
Company  must raise  sufficient  funds for the  purchase  and  operation  of the
winery.  The Company is currently  testing the waters with a private  placement,
which,  if successful,  would be utilized to finance the purchase of the winery.
There can be no  assurances  that the Company  will enter into a final  purchase
contract or that it will be able to raise sufficient funds to close the proposed
purchase.

         The  Company  may obtain  funds in one or more  private  placements  to
finance the acquisition and/or operation of any acquired business, if necessary.
Persons  purchasing  securities in these placements and other  shareholders will
likely not have the  opportunity to participate in the decision  relating to any
acquisition.  The  Company's  proposed  business is  sometimes  referred to as a
"blind pool" because any investors will entrust their  investment  monies to the
Company's  management  before they have a chance to analyze any  ultimate use to
which their money may be put.  Consequently,  the Company's potential success is
<PAGE>

heavily  dependent  on the  Company's  management,  which  will  have  unlimited
discretion in searching for and entering into a business  opportunity.  The sole
officer and director of the Company likely has had no experience in any proposed
business of the Company. There can be no assurance that the Company will be able
to raise any funds in private placement.

LIQUIDITY AND CAPITAL RESOURCES

         The Company remains in the development stage and, since inception,  has
experienced  no  significant   change  in  liquidity  or  capital  resources  or
stockholder's  equity.  The  Company's  balance  sheet as of December  31, 2001,
reflects a current asset value of $0, and a total asset value of $0.

         The Company will carry out its plan of business as discussed above. The
Company cannot  predict to what extent its liquidity and capital  resources will
be diminished prior to the consummation of a business combination or whether its
capital  will be  further  depleted  by the  operating  losses  (if  any) of the
business entity which the Company may eventually acquire.

RESULTS OF OPERATIONS

         During the period from October 20, 1999 through  December 31, 2001, the
Company  has  engaged in no  significant  operations  other than  organizational
activities and registration of its securities under the Securities  Exchange Act
of 1934. The Company received no revenues during this period.

         For the current fiscal year, the Company  anticipates  incurring a loss
as a result of  organizational  expenses,  expenses  associated  with  continued
reporting requirements as a result of registration under the Securities Exchange
Act of 1934, and expenses  associated  with locating and evaluating  acquisition
candidates.  The  Company  anticipates  that  until a  business  combination  is
completed with an  acquisition  candidate,  it will not generate  revenues other
than interest  income,  and may continue to operate at a loss after completing a
business combination, depending upon the performance of the acquired business.

         The  Company  had no costs  of  sales  revenues  for the  period  ended
December 31, 2001 or 2000 because it had not yet had any business operations for
the past three years.  The Company had general and  administrative  expenses for
the period ended December 31, 2001 in the amount of $63,121, compared to general
and administrative expenses of $2,181 for 2000. The increase in expense resulted
primarily from accounting,  legal,  and travel  expenditures on due diligence in
the evaluation of business opportunities for the Company.

         The  Company  recorded  net income  loss of $63,121  for the year ended
December 31, 2001 compared to $2,181 loss for the comparable period in 2000.

<PAGE>

         At December 31,  2001,  the Company had total  current  assets of $0 as
compared  to $0 current  assets at  December  31,  2000.  The  Company had a net
working  capital  deficit of $44,145 at  December  31,  2001,  compared to a net
working capital deficit of $0 at December 31, 2000. Net stockholders' deficit in
the Company was $44,145 as of December 31, 2001 and $0 at December 31, 2000.

Need for Additional Financing

         The Company  believes  that its existing  capital will be sufficient to
meet the  Company's  cash  needs,  including  the costs of  compliance  with the
continuing  reporting  requirements  of the Securities  Exchange Act of 1934, as
amended, for the current fiscal year. There is no assurance,  however,  that the
available funds will  ultimately  prove to be adequate to allow it to complete a
business  combination,  and  once  a  business  combination  is  completed,  the
Company's needs for additional financing are likely to increase substantially.

FEDERAL INCOME TAX ASPECTS OF INVESTMENT IN THE COMPANY

         The discussion contained herein has been prepared by the Company and is
based on existing law as contained in the Internal Revenue Code,  amended United
States Treasury Regulations ("Treasury Regulations"), administrative rulings and
court decisions as of the date of this Annual Report.  No assurance can be given
that future legislative  enactments,  administrative  rulings or court decisions
will not modify the legal basis for statements contained in this discussion. Any
such development may be applied retroactively to transactions completed prior to
the date thereof, and could contain provisions having an adverse affect upon the
Company and the holders of the Common Stock. In addition,  several of the issues
dealt with in this summary are the subjects of proposed and  temporary  Treasury
Regulations.  No assurance can be given that these  regulations  will be finally
adopted in their present form.

FORWARD LOOKING STATEMENT

         This  Management's  Discussion and Analysis of Financial  Condition and
Results of  Operations  includes  a number of  forward-looking  statements  that
reflect  Management's  current views with respect to future events and financial
performance. Those statements include statements regarding the intent, belief or
current  expectations  of the Company and members of its management team as well
as the assumptions on which such statements are based. Prospective investors are
cautioned that any such forward-looking  statements are not guarantees of future
performance  and involve  risk and  uncertainties,  and that actual  results may
differ materially from those  contemplated by such  forward-looking  statements.
Readers are urged to carefully review and consider the various  disclosures made
by the Company in this report and in the Company's  other reports filed with the
Securities  and  Exchange  Commission.   Important  actors  currently  known  to
Management could cause actual results to differ materially from those in

<PAGE>

forward-looking  statements.  The Company  undertakes no obligation to update or
revise forward-looking statements to reflect changed assumptions, the occurrence
of unanticipated  events or changes in the future  operating  results over time.
The Company believes that its assumptions are based upon reasonable data derived
from and known about its business and operations and the business and operations
of the Company.  No assurances are made that actual results of operations or the
results of the Company's future  activities will not differ  materially from its
assumptions.

ITEM 7.  FINANCIAL STATEMENTS

         The financial  statements  are included  beginning at F-1. See Index to
the Financial Statements.

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
              ON ACCOUNTING AND FINANCIAL DISCLOSURE

     None.
                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
PERSONS

Directors and Executive Officers.

         The members of the Board of  Directors  of the Company  serve until the
next  annual  meeting  of  stockholders,  or until  their  successors  have been
elected.  The  officers  serve  at the  pleasure  of  the  Board  of  Directors.
Information  as to the  director  and  executive  officer  of the  Company is as
follows.

         Daniel Hodges, 35, has been sole Director,  President,  Chief Financial
Officer  and  Secretary  of the Company  since  inception.  Mr.  Hodges has been
president  and  director  of  Solomon  Consulting  Corp.  which  specializes  in
corporate  and  securities  consulting  since 1995.  He has managed and directed
companies which specialized in real estate development, corporate and securities
consulting.  He has owned and  developed  real  estate  projects  in the Tucson,
Arizona area since the 1980's.  Mr. Hodges also serves on the board of directors
of two  charitable  organizations  as well as a  number  of blank  check  public
companies.

         Mr.  Hodges  graduated  from Thomas Edison State College in 1989 with a
Bachelor's  Degree in Aviation Science and went on to be accepted into Air Force
Undergraduate  Pilot Training at Williams Air Force Base in Arizona.  Since then
he has held squadron  duties as an F-16 pilot in Illinois,  Montana and Arizona.
He is currently a part-time  F-16  Instructor  Pilot in the Arizona Air National
Guard located in Tucson, Arizona.
<PAGE>

Conflicts of Interest

         Certain  conflicts  of  interest  now exist and will  continue to exist
between the Company and its sole  officer and director due to the fact that each
has other  business  interests  to which he devotes his primary  attention.  Mr.
Hodges has organized, is an officer,  director and has a controlling interest in
more than 50 "blank check"  companies  whose  business is similar to that of the
Company.  He may continue to do so notwithstanding the fact that management time
should be devoted to the business of the Company.

         Certain  conflicts  of interest  may exist  between the Company and its
sole director and officer,  Mr. Hodges, and conflicts may develop in the future.
The Company has not  established  policies or procedures  for the  resolution of
current or potential conflicts of interests.  There can be no assurance that Mr.
Hodges will  resolve all  conflicts  of  interest in favor of the  Company,  and
failure by Mr.  Hodges to conduct the Company's  business in the Company's  best
interest may result in liability to Mr. Hodges.  Mr. Hodges, as the sole officer
and director, is accountable to the Company as a fiduciary,  which means that he
is required to  exercise  good faith and  integrity  in handling  the  Company's
affairs. Shareholders who believe that the Company has been harmed by failure of
Mr. Hodges to  appropriately  resolve any conflict of interest  may,  subject to
applicable  rules  of  civil  procedure,  be able to  bring  a class  action  or
derivative suit to enforce their rights and the Company's rights.

         The Company has no  arrangement,  understanding  or  intention to enter
into any  transaction for  participating  in any business  opportunity  with any
officer,  director,  or  principal  shareholder  or with  any  firm or  business
organization with which such persons are affiliated,  whether by reason of stock
ownership, position as an officer or director, or otherwise.

Compliance with Section 16(a) of the Securities Exchange Act of 1934

         Section  16(a) of the Exchange Act,  requires the  Company's  officers,
directors and persons who  beneficially  own more than ten percent of the Common
Stock to file reports of securities ownership and changes in such ownership with
the Securities and Exchange Commission. Officers, directors and greater than ten
percent  beneficial  owners  also  are  required  by  rules  promulgated  by the
Securities  and  Exchange  Commission  to furnish the Company with copies of all
Section 16(a) forms they file.

ITEM 10.  EXECUTIVE COMPENSATION

         The Company has paid no compensation  from inception  through  December
31, 2001. It is possible that upon an acquisition some  compensation may be paid
to management. On acquisition of a business opportunity,  current management may
resign and be  replaced  by persons  associated  with the  business  opportunity
acquired,  particularly if the Company participates in a business opportunity by
effecting a reorganization, merger or consolidation. If any member of current

<PAGE>

management  remains after  effecting a business  opportunity  acquisition,  that
member's time  commitment will likely be adjusted based on the nature and method
of the acquisition and location of the business which cannot be predicted.  Such
a new  board  of  directors  will  determine  compensation  of  management,  and
shareholders  of the Company will not have the opportunity to vote on or approve
such compensation.

         The  Company  has no  employment  agreements  with  any  persons  as of
December 31, 2001.  No  retirement,  pension,  profit  sharing,  stock option or
insurance  programs or other  similar  programs have been adopted by the Company
for the benefit of any  employees as of December  31, 2001.  On January 3, 2002,
the Company adopted an Employee Stock Option Plan.


ITEM 11.  SECURITY OWNERSHIP OF BENEFICIAL OWNERS AND MANAGEMENT

         The table  below sets forth  information  as to each  person  owning of
record or who was known by the Company to own  beneficially  more than 5% of the
3,000,000 shares of issued and outstanding  Common Stock,  including  options to
acquire stock of the Company as of December 31, 2001 and  information  as to the
ownership of the Company's Stock by each of its directors and executive officers
and by the  directors  and  executive  officers as a group.  Except as otherwise
indicated,  all shares are owned  directly,  and the persons  named in the table
have  sole  voting  and  investment  power  with  respect  to  shares  shown  as
beneficially owned by them.
<TABLE>
<CAPTION>
                                                           # of
Name and Address                 Nature of                Shares
of Beneficial Owners             Ownership                Owned            Percent

<S>                                 <C>                 <C>                     <C>
Daniel L. Hodges                    Common              1,600,000               53.3%
Chairman, President and Chief Executive Officer
11601 E. Lusitano Pl.
Tucson, AZ 85748

Bryan E. Rhodes                     Common                    416,000           13.8%
9160 E. Deer Trail
Tucson, AZ 85730

Kevin M. Sherlock                   Common                    300,000           10%
2609 E. Broadway Blvd.
Tucson, AZ 85716

Brian C. Delfs                      Common                    200,000            6.7%
10130 E. Winding Trail
Tucson, AZ 85749

All Executive Officers
And Directors as a Group            Common                    1,600,000         53.3%
</TABLE>


<PAGE>

ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

         In connection with organizing the Company, on November 4, 1997, persons
consisting of its officers, directors, and other individuals were issued a total
of 1,000  shares of Common  Stock at a value of $.001 per share.  On October 20,
1999, the outstanding shares were forward split 1,000 to 1, resulting in a total
of  1,000,000  shares  outstanding.  On December 26, 2001 the Board of Directors
authorized 2 for 1 stock split for the Company's  common  stock.  As a result of
the split 1,000,000 shares were issued, resulting in a total of 2,000,000 shares
outstanding.  On December 28, 2001, the Company issued 1,000,000 shares pursuant
to a subscription  at the rate of $0.01 per share. As a result of this issuance,
a total amount of 3,000,000 shares were outstanding at December 31, 2001.

         Under Rule 405 promulgated under the Securities Act of 1933, Mr. Hodges
may be deemed to be a promoter of the Company.

ITEM 13.  EXHIBITS AND REPORTS ON FORM 8-K


     (a) EXHIBITS

The following  documents are filed herewith or have been included as exhibits to
previous  filings  with  the  Commission  and are  incorporated  herein  by this
reference:

           Exhibit No.         Exhibit

           *3                  Articles of Incorporation

           *3.2                Bylaws

           *3.1                Amended Articles of Incorporation

         (b) Reports on Form 8-K.  No reports on Form 8-K were filed  during the
period covered by this Form 10-KSB.

     *  Incorporated   herein  by  reference  from  Registrant's  Form  10SB12G,
Registration Statement, dated February 11, 2000.

                                   SIGNATURES

         In accordance  with Section 13 or 15(d) of the Securities  Exchange Act
of 1934,  the  registrant  caused  this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

TERRA NOVA VINEYARDS, INC.
(Formerly known as Conservative West, Inc.)

By:   /s/ Daniel L. Hodges
      Daniel L. Hodges
      President, Chief Finance Officer and
      Director
Date: January 30, 2002

<PAGE>
                           TERRA NOVA VINEYARDS, INC.
                        (Formerly Conservative West Inc.)
                          (A Development Stage Company)

                                       -:-

                          INDEPENDENT AUDITOR'S REPORT

                           DECEMBER 31, 2001 and 2000






<PAGE>






                                           CONTENTS

<TABLE>
<CAPTION>

                                                                                       Page

<S>                                                                                    <C>
Independent Auditor's Report...........................................................F - 1

Balance Sheets
  December 31, 2001 and 2000...........................................................F - 2

Statements of Operations
  For the Years Ended December 31, 2001 and 2000.......................................F - 3

Statement of Stockholders' Equity
 Since July 25, 1997 (Inception) to December 31, 2001..................................F - 4

Statements of Cash Flows
  For the Years Ended December 31, 2001 and 2000.......................................F - 5

Notes to Financial Statements..........................................................F - 6
</TABLE>



<PAGE>









                                 INDEPENDENT AUDITOR'S REPORT


Terra Nova Vineyards, Inc.
(Formerly Conservative West Inc.)
(A Development Stage Company)


        We have audited the accompanying balance sheets of Terra Nova Vineyards,
Inc.  (Formerly  Conservative  West Inc.) (a  development  stage  company) as of
December 31, 2001 and 2000,  and the related  statements of operations  and cash
flows  for  the  two  years  ended  December  31,  2001  and  the  statement  of
stockholders'  equity from July 25, 1997 (inception) to December 31, 2001. These
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

        We conducted our audits in accordance with auditing standards  generally
accepted in the United States of America.  Those standards  require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

        In our  opinion,  the  financial  statements  referred to above  present
fairly,  in  all  material  respects,  the  financial  position  of  Terra  Nova
Vineyards,  Inc. (Formerly Conservative West Inc.) (a development stage company)
as of December 31, 2001 and 2000, and the results of its operations and its cash
flows for the two years ended  December 31, 2001 in  conformity  with  generally
accepted accounting principles.

                                                   Respectfully submitted



                                                   /S/ ROBISON, HILL & CO.
                                                   Certified Public Accountants

Salt Lake City, Utah
January 9, 2002

                                            F - 1

<PAGE>



                                  TERRA NOVA VINEYARDS, INC.
                              (Formerly Conservative West Inc.)
                                (A Development Stage Company)
                                        BALANCE SHEETS
<TABLE>
<CAPTION>

                                                          December 31,
                                                 -------------------------------
                                                      2001            2000
                                                 --------------  ---------------

<S>                                              <C>             <C>
Assets:                                          $            -  $             -
                                                 ==============  ===============

Liabilities - Accounts Payable                   $       44,145  $             -
                                                 --------------  ---------------

Stockholders' Equity:
  Preferred Stock, Par value $.001
     Authorized 5,000,000, Issued none                        -                -
  Common Stock, Par value $.001
    Authorized 100,000,000 shares,
    Issued 3,000,000 shares at December 31,
    2001 and 2,000,000 at December 31, 2000               3,000            2,000
  Paid-In Capital                                        19,507            1,531
  Retained Deficit                                       (1,200)          (1,200)
  Deficit Accumulated During the
    Development Stage                                   (65,452)          (2,331)
                                                 --------------  ---------------

     Total Stockholders' Equity                         (44,145)               -
                                                 --------------  ---------------

     Total Liabilities and
       Stockholders' Equity                      $            -  $             -
                                                 ==============  ===============
</TABLE>











          The  accompanying  notes  are an  integral  part  of  these  financial
statements.

                                            F - 2

<PAGE>



                                  TERRA NOVA VINEYARDS, INC.
                              (Formerly Conservative West Inc.)
                                (A Development Stage Company)
                                   STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>

                                                                   Cumulative
                                                                      since
                                                                   October 20,
                                                                      1999
                                                                    inception
                                       For the year ended              of
                                          December 31,             development
                                 ------------------------------
                                      2001            2000            stage
                                 --------------  --------------  ---------------
<S>                              <C>             <C>             <C>
Revenues:                        $            -  $            -  $             -

Expenses:                                63,121           2,181            2,331
                                 --------------  --------------  ---------------

     Net Loss                    $      (63,121) $       (2,181) $       (65,452)
                                 --------------  --------------  ---------------

Basic & Diluted loss per share   $       (0.03)  $            -
                                 ==============  ==============
</TABLE>
















    The accompanying notes are an integral part of these financial statements

                                            F - 3

<PAGE>



                           TERRA NOVA VINEYARDS, INC.
                        (Formerly Conservative West Inc.)
                          (A Development Stage Company)
                        STATEMENT OF STOCKHOLDERS' EQUITY
                        SINCE JULY 25 ,1997 (INCEPTION) TO DECEMBER 31, 2000
<TABLE>
<CAPTION>
                                                                                          Deficit
                                                                                        Accumulated
                                                                                          During
                                           Common Stock         Paid-In    Retained     Development
                                        Shares     Par Value    Capital     Deficit        Stage
                                     ------------ -----------  ---------  -----------  -------------
<S>                                  <C>          <C>          <C>        <C>          <C>
Balance at July 25, 1997 (inception)            - $         -  $       -  $         -  $           -

November 4, 1997 Issuance of Stock
for Services and payment
of Accounts Payable                     2,000,000       2,000          -            -              -

Net Loss                                        -           -          -       (1,100)             -
                                     ------------ -----------  ---------  -----------  -------------
Balance at December 31, 1997            2,000,000       2,000          -       (1,100)             -

Net Loss                                        -           -          -         (100)             -
                                     ------------ -----------  ---------  -----------  -------------
Balance at December 31, 1998            2,000,000       2,000          -       (1,200)             -

Capital contributed by Shareholder              -           -        350            -              -
Net Loss                                        -           -          -            -           (150)
                                     ------------ -----------  ---------  -----------  -------------
Balance at December 31, 1999            2,000,000       2,000        350       (1,200)          (150)

Capital contributed by Shareholder              -           -      1,181            -              -
Net Loss                                        -           -          -            -         (2,181)
                                     ------------ -----------  ---------  -----------  -------------
Balance at December 31, 2000            2,000,000       2,000      1,531       (1,200)        (2,331)

Capital contributed by Shareholder              -           -      8,976            -              -
December 28, 2001 stock issued
  for cash                                1000000        1000       9000            -              -
Net Loss                                        -           -          -            -        (63,121)
                                     ------------ -----------  ---------  -----------  -------------
Balance at December 31, 2001            3,000,000 $     3,000  $  19,507  $    (1,200) $     (65,452)
                                     ============ ===========  =========  ===========  =============
</TABLE>






             The  accompanying  notes are an  integral  part of these  financial
statements.

                                      F - 4

<PAGE>



                           TERRA NOVA VINEYARDS, INC.
                        (Formerly Conservative West Inc.)
                          (A Development Stage Company)
                            STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
                                                                    Cumulative
                                                                      Since
                                                                   October 20,
                                                                       1999
                                                                    Inception
                                            For the years ended         of
                                               December 31,        Development
                                            -------------------
                                               2000      2000         Stage
                                            ---------- --------   --------------
CASH FLOWS FROM OPERATING
ACTIVITIES:
<S>                                         <C>        <C>        <C>
Net Loss                                    $  (63,121)$ (2,181)  $      (65,452)
Increase (Decrease) in Accounts Payable         44,145        -           43,945
                                            ---------- --------   --------------
  Net Cash Used in operating activities        (18,976)  (2,181)         (21,507)
                                            ---------- --------   --------------

CASH FLOWS FROM INVESTING
ACTIVITIES:
Net cash provided by
  investing activities                               -        -                -
                                            ---------- --------   --------------

CASH FLOWS FROM FINANCING
ACTIVITIES:
Issuance of common stock                        10,000                    10,000
Capital contributed by shareholder               8,976    2,181           11,507
                                            ---------- --------   --------------
Net Cash Provided by
  Financing Activities                          18,976    2,181           21,507
                                            ---------- --------   --------------

Net (Decrease) Increase in
  Cash and Cash Equivalents                          -        -                -
Cash and Cash Equivalents
  at Beginning of Period                             -        -                -
                                            ---------- --------   --------------
Cash and Cash Equivalents
  at End of Period                          $        - $      -   $            -
                                            ========== ========   ==============

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the year for:
  Interest                                  $        - $      -   $            -
  Franchise and income taxes                $      200 $    200   $          700
</TABLE>
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND
FINANCING ACTIVITIES: None
             The  accompanying  notes are an  integral  part of these  financial
statements.

                                      F - 5

<PAGE>



                                  TERRA NOVA VINEYARDS, INC.
                              (Formerly Conservative West Inc.)
                                (A Development Stage Company)
                                NOTES TO FINANCIAL STATEMENTS
                        FOR THE YEARS ENDED DECEMBER 31, 2001 and 2000


NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

        This  summary of  accounting  policies  for Terra Nova  Vineyards,  Inc.
(Formerly  Conservative  West Inc.) is presented to assist in understanding  the
Company's  financial  statements.  The accounting  policies conform to generally
accepted  accounting  principles  and  have  been  consistently  applied  in the
preparation of the financial statements.

Organization and Basis of Presentation

        The  Company was  incorporated  under the laws of the State of Nevada on
July 25, 1997.  The Company  ceased all operating  activities  during the period
from July 25, 1997 to October 20, 1999 and was considered dormant. Since October
20, 1999, the Company is in the development stage, and has not commenced planned
principal operations.

Nature of Business

        The Company has no products  or services as of December  31,  2001.  The
Company was organized as a vehicle to seek merger or acquisition candidates. The
Company intends to acquire interests in various business opportunities, which in
the opinion of management will provide a profit to the Company.

Cash and Cash Equivalents

        For purposes of the statement of cash flows,  the Company  considers all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents to the extent the funds are not being held for investment
purposes.

Pervasiveness of Estimates

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

Concentration of Credit Risk

        The  Company  has no  significant  off-balance-sheet  concentrations  of
credit  risk such as foreign  exchange  contracts,  options  contracts  or other
foreign  hedging  arrangements.  The Company  maintains the majority of its cash
balances with one financial institution, in the form of demand deposits.

                                            F - 6

<PAGE>



                                  TERRA NOVA VINEYARDS, INC.
                              (Formerly Conservative West Inc.)
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                        FOR THE YEARS ENDED DECEMBER 31, 2001 and 2000
                                   (Continued)

NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(Continued)

Loss per Share

        The reconciliations of the numerators and denominators of the basic loss
per share computations are as follows:
<TABLE>
<CAPTION>
                                                                                  Per-Share
                                                  Income           Shares           Amount
                                                  ------           ------           ------
                                                (Numerator)     (Denominator)

                                                    For the year ended December 31, 2001
Basic Loss per Share
<S>                                           <C>                    <C>        <C>
Loss to common shareholders                   $       (63,121)       2,008,219  $       (0.03)
                                              ===============  ===============  ==============


                                                    For the year ended December 31, 2000
Basic Loss per Share
Loss to common shareholders                   $        (2,181)       2,000,000  $            -
                                              ===============  ===============  ==============
</TABLE>
        The  effect  of   outstanding   common   stock   equivalents   would  be
anti-dilutive for December 31, 2001 and 2000 and are thus not considered.

NOTE 2 - INCOME TAXES

        As  of  December  31,  200,  the  Company  had  a  net  operating   loss
carryforward for income tax reporting purposes of approximately $65,000 that may
be offset against future taxable income through 2016. Current tax laws limit the
amount of loss  available  to be offset  against  future  taxable  income when a
substantial  change in  ownership  occurs.  Therefore,  the amount  available to
offset future taxable income may be limited. No tax benefit has been reported in
the financial statements, because the Company believes there is a 50% or greater
chance the  carryforwards  will expire  unused.  Accordingly,  the potential tax
benefits of the loss  carryforwards  are offset by a valuation  allowance of the
same amount.

NOTE 3 - DEVELOPMENT STAGE COMPANY

         The Company has not begun principal  operations and as is common with a
development  stage  company,  the Company has had  recurring  losses  during its
development stage. The Company's

                                            F - 7

<PAGE>



                           TERRA NOVA VINEYARDS, INC.
                        (Formerly Conservative West Inc.)
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2001 and 2000
                                   (Continued)

NOTE 3 - DEVELOPMENT STAGE COMPANY (Continued)

financial statements are prepared using generally accepted accounting principles
applicable to a going concern which  contemplates  the realization of assets and
liquidation  of  liabilities  in the normal  course of  business.  However,  the
Company does not have  significant  cash or other material  assets,  nor does it
have an established  source of revenues  sufficient to cover its operating costs
and to allow it to continue as a going concern. In the interim,  shareholders of
the Company have committed to meeting its minimal operating expenses.

NOTE 4 - COMMITMENTS

        As of  December  31,  2001  all  activities  of the  Company  have  been
conducted by  corporate  officers  from either their homes or business  offices.
Currently,  there are no  outstanding  debts owed by the  company for the use of
these facilities and there are no commitments for future use of the facilities.

NOTE 5 - STOCK SPLIT

        On December  26, 2001 the Board of  Directors  authorized  2 for 1 stock
split for the Company's  common stock. As a result of the split 1,000,000 shares
were issued.  All  references in the  accompanying  financial  statements to the
number of common shares and per-share  amounts for dates prior to 2001 have been
restated to reflect the stock split.

NOTE 6 - PREFERRED STOCK

        On December 26, 2001 the Board of Directors authorized the establishment
of preferred shares of stock. The articles of incorporation have been amended to
authorize the issuance of 5,000,000  preferred  shares. No preferred shares have
been issued.

NOTE 7 - SUBSEQUENT EVENTS

        On December  24,  2001 the  Company  executed a letter of intent for the
purchase of assets of Anderson's Conn Valley Winery, Inc. and real property used
in the  business  of the  winery.  The  purchase  price of the  winery  and real
property is $10,000,000  cash at closing,  a convertible  promissory note in the
principal amount of $1,200,000, the assumption of debt in the approximate amount
of $4,100,000 and the issuance of promissory notes in the approximate  amount of
$3,400,000.


                                            F - 8

<PAGE>


                           TERRA NOVA VINEYARDS, INC.
                        (Formerly Conservative West Inc.)
                          (A Development Stage Company)
                          NOTES TO FINANCIAL STATEMENTS
                 FOR THE YEARS ENDED DECEMBER 31, 2001 and 2000
                                   (Continued)

NOTE 7 - SUBSEQUENT EVENTS (Continued)

        On January 7, 2002 the Company issued a $750,000 debenture with warrants
to purchase  75,000 shares of common stock at $.01 per share.  The proceeds from
the  debenture  were  deposited  in escrow for the  purchase  of the Conn Valley
winery discussed above.

                                            F - 9