================================================================================
                        SECURITIES & EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                        Edgarized from this one 11-13--2
                                    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 OF 15(D) OF THE  SECURITIES
     EXCHANGE ACT OF 1934


For the transition period from            to

Commission File No. 1-15097
                    -------

                          LYNCH INTERACTIVE CORPORATION
                          -----------------------------
             (Exact name of Registrant as specified in its charter)



         Delaware                              06-1458056
         --------                              ----------
 State or other jurisdiction of              (I.R.S. Employer
 incorporation or organization)             Identification No.)


401 Theodore Fremd Avenue, Rye, New York         10580
----------------------------------------       ----------
(Address of principal executive offices)       (Zip Code)

                                 (914) 921-8821
                                 --------------
               Registrant's telephone number, including area code

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

Indicate the number of shares outstanding of each of the Registrant's classes of
Common Stock, as of the latest practical date.

            Class                              Outstanding at November 1, 2002
            -----                              -------------------------------
Common Stock, $.0001 par value                           2,794,351

================================================================================
<PAGE>

                                      INDEX

                 LYNCH INTERACTIVE CORPORATION AND SUBSIDIARIES

PART I.     FINANCIAL INFORMATION


Item 1.  Financial Statements (Unaudited)
         --------------------------------

Condensed Consolidated Balance Sheets:
  -      September 30, 2002
  -      December 31, 2001

Condensed Consolidated Statements of Operations:
  -      Three months ended September 30, 2002 and 2001
  -      Nine months ended September 30, 2002 and 2001

Condensed Consolidated Statements of Cash Flows:
  -      Three months ended September 30, 2002 and 2001
  -      Nine months ended September 30, 2002 and 2001

Notes to Condensed Consolidated Financial Statements

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


SIGNATURE

CERTIFICATIONS















                                                         i

<PAGE>
<TABLE>

PART I.  FINANCIAL INFORMATION
Item 1.  Financial Statements
                 LYNCH INTERACTIVE CORPORATION AND SUBSIDIAIRES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                      (In thousands, except share amounts)
<CAPTION>
                                                                                     September 30,     December 31,
                                                                                         2002              2001
                                                                                    ---------------- -----------------
                                                                                      (Unaudited)         (Note)
ASSETS
<S>                                                                                     <C>          <C>
CURRENT ASSETS:
  Cash and cash equivalents .................................................. .        $  25,338    $  23,664
  Restricted cash .............................................................            10,598        7,569
  Receivables, less allowances of $345 and
    $424, respectively ........................................................             9,381        9,963
  Material and supplies .......................................................             3,739        3,373
  Prepaid expenses and other current assets ...................................             2,472        1,757
  Current assets of Morgan Group Holding Co. ...................................
      distributed to shareholders ...............................................              --       12,757
                                                                                         ---------    ---------
TOTAL CURRENT ASSETS ...........................................................           51,528       59,083

PROPERTY, PLANT AND EQUIPMENT:
  Land .........................................................................              840          840
  Buildings and improvements ...................................................           10,952       10,858
  Machinery and equipment ......................................................          190,018      178,110
                                                                                        ---------    ---------
                                                                                          201,810      189,808
  Accumulated Depreciation .....................................................          (85,661)     (74,419)
                                                                                        ---------    ---------
                                                                                          116,149      115,389
GOODWILL .......................................................................           60,889       60,889
OTHER INTANGIBLE ASSETS, NET ...................................................            7,087        7,858
INVESTMENTS IN AND ADVANCES TO AFFILIATED ENTITIES .............................            8,223       14,277
OTHER ASSETS ...................................................................            9,741       11,611
NON CURRENT ASSETS OF MORGAN GROUP HOLDING CO ..................................
      DISTRIBUTED TO SHAREHOLDERS ..............................................               --       10,241
                                                                                        ---------    ---------
TOTAL ASSETS ...................................................................        $ 253,617    $ 279,348
                                                                                        =========    =========

LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
  Notes payable to banks .......................................................        $  10,744    $  10,336
  Trade accounts payable .......................................................              801          921
  Accrued interest payable .....................................................            1,419        1,579
  Accrued liabilities ..........................................................           19,322       15,700
  Current maturities of long-term debt, includes $10,500 of convertible notes
 due 2004, but subject to a put provision (See note G) .........................           26,981       28,126
  Current liabilities of Morgan Group Holding Co. ..............................
   distributed to shareholders .................................................               --       11,281
                                                                                        ---------    ---------
   TOTAL CURRENT LIABILITIES ...................................................           59,267       67,943
   LONG-TERM DEBT ..............................................................          160,632      165,076
   DEFERRED INCOME TAXES .......................................................            5,721        8,515
   OTHER LIABILITIES ...........................................................              752          887
   MINORITY INTERESTS ..........................................................            6,999        6,120
   NON CURRENT LIABILITIES AND MINORITY
   INTERESTS OF MORGAN GROUP HOLDING CO ........................................
   DISTRIBUTED TO SHAREHOLDERS .................................................               --        6,290

COMMITMENTS AND CONTINGENCIES

SHAREHOLDERS' EQUITY
  COMMON STOCK, $0.0001 PAR VALUE-10,000,000
     SHARES AUTHORIZED; 2,824,766 ISSUED; 2,796,251
     and 2,820,051 outstanding .................................................               --           --
  ADDITIONAL PAID-IN CAPITAL ...................................................            21,406       21,406
  RETAINED EARNINGS (DEFICIT) ..................................................              (247)       1,800
  ACCUMULATED OTHER COMPREHENSIVE INCOME .......................................               181        1,542
  TREASURY STOCK, 28,515 and 4,715 shares, at cost .............................            (1,094)        (231)
                                                                                           --------    ---------
  TOTAL SHAREHOLDER'S EQUITY ...................................................            20,246       24,517
                                                                                          ---------    ---------
  TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY ...................................         $ 253,617    $ 279,348
                                                                                         =========    =========

Note:  The balance  sheet at December 31, 2001 has been derived from the audited
financial  statements at that date, but does not include all of the  information
and footnotes required by accounting principles generally accepted in the Untied
States for complete financial statements.
</TABLE>

See accompanying notes.
                                       1
<PAGE>
<TABLE>

                 LYNCH INTERACTIVE CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)
               (In thousands, except per share and share amounts)
<CAPTION>

                                                                    Three Months Ended          Nine Months Ended
                                                                      September 30,               September 30,
                                                                    2002         2001          2002          2001
                                                                -------------------------------------------------------

<S>                                                              <C>            <C>            <C>            <C>
SALES AND REVENUES ...........................................   $    22,983    $    23,934    $    65,055    $    58,594

COSTS AND EXPENSES:
Operations, exclusive of depreciation and amortization .......        10,928          9,931         31,687         27,040
Depreciation and amortization ................................         4,857          4,961         14,448         13,177
Selling and administrative ...................................         1,307            677          3,328          2,133
                                                                  ----------    -----------     ----------    -----------
OPERATING PROFIT .............................................         5,891          8,365         15,592         16,244

Other income (expense):
   Gain on sale of cellular partnership ......................          --             --            4,965           --
   Investment income .........................................           162            200          1,394          2,593
   Interest expense ..........................................        (3,240)        (3,865)        (9,911)       (10,697)
   Impairment of investment in Spinnaker Industries, Inc. ....          --           (1,294)          --           (1,294)
   Reserve for impairment of investment in spectrum license
     Holder ..................................................        (5,479)          --           (5,479)          --
   Equity in earnings of affiliated companies, predominantly
     cellular ................................................           429            213            857            582
                                                                   ----------   -----------    -----------    -----------
                                                                      (8,128)        (4,746)        (8,174)        (8,816)
                                                                   ----------   -----------    -----------    -----------
INCOME (LOSS) BEFORE INCOME TAXES, MINORITY INTERESTS AND
OPERATIONS OF MORGAN GROUP HOLDING CO ........................        (2,237)         3,619          7,418          7,428
(Provision) benefit for income taxes .........................           550         (1,649)        (3,233)        (3,554)
Minority Interests ...........................................          (185)          (185)          (879)          (508)
                                                                    ----------  -----------    -----------    -----------
INCOME (LOSS)  FROM CONTINUING OPERATIONS ....................        (1,872)         1,785          3,306          3,366
                                                                    ----------  -----------    -----------    -----------

Income (loss) from operations of Morgan Group Holding Co. ....
distributed to shareholders, net of income taxes of $0, $255,
$0 and $255, respectively and minority interests of $0, $69
$868 and $31, respectively ...................................          --             (190)        (1,888)          (143)
                                                                    ----------  -----------    -----------    -----------
NET INCOME (LOSS) ............................................   $    (1,872)   $     1,595    $     1,418    $     3,223
                                                                   ===========  ===========    ===========    ===========

Basic weighted average shares outstanding ....................     2,799,000      2,822,000      2,809,000      2,822,000
Diluted weighted average shares outstanding - used in earnings
  per share computation (if the shares to be issued on
conversion of the convertible note were included, fully
diluted shares would be 3,035,000; 3,057,000; 3,044,000; and
3,128,000 respectively) ......................................     2,799,000      2,822,000      2,809,000      2,822,000
BASIC EARNINGS PER SHARE
INCOME (LOSS)  FROM CONTINUING OPERATIONS ....................   $     (0.67)   $      0.63    $      1.18    $      1.19
Loss from operations of Morgan Group Holding Co. .............
  distributed to shareholders ................................          0.00          (0.06)         (0.68)         (0.05)
                                                                 -----------    -----------    -----------    -----------
NET INCOME (LOSS) ............................................   $     (0.67)   $      0.57    $      0.50    $      1.14
                                                                 ===========    ===========    ===========    ===========
DILUTED EARNINGS PER SHARE
INCOME (LOSS) FROM CONTINUING OPERATIONS .....................   $     (0.67)   $      0.63    $      1.18    $      1.19
Loss from operations of Morgan Group Holding Co. .............          0.00          (0.06)         (0.68)         (0.05)
                                                                 -----------    -----------    -----------    -----------
NET INCOME (LOSS) ............................................   $     (0.67)   $      0.57    $      0.50    $      1.14
                                                                 ===========    ===========    ===========    ===========
</TABLE>
See accompanying notes.
                                       2
<PAGE>
<TABLE>

                 LYNCH INTERACTIVE CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (UNAUDITED)
                                 (In thousands)
<CAPTION>
                                                                        Three Months Ended       Nine Months Ended
                                                                          September 30,            September 30,
                                                                     ------------------------- -----------------------
                                                                         2002         2001        2002        2001
                                                                     ------------ ----------- ----------- -----------
     OPERATING ACTIVITIES
     <S>                                                              <C>         <C>         <C>         <C>
     Net Income (Loss) ............................................   ($ 1,872)   $  1,595    $  1,418    $  3,223
     Adjustments  to reconcile  net income to net cash  provided by
     operating activities:
        Depreciation and amortization .............................      4,857       4,961      14,448      13,177
        Net effect of purchases and sales of trading securities ...       --           768        --          (304)
        Deferred Taxes ............................................     (1,863)          0      (1,863)          0
        Equity in earnings of affiliated companies ................       (429)       (213)       (857)       (582)
        Minority interests ........................................        185         185         879         508
        Impairment of investment in Spinnaker Industries, Inc. ....       --         1,294        --         1,294
        Reserve  for  the  impairment  of  investment  in  spectrum
        license holder                                                   5,479        --         5,479        --
        Gain on sale of cellular partnership ......................       --          --        (4,965)       --
        Gain on sale of available for sale securities .............       --          (142)        (24)       (296)
        Non-cash items and assets and operating liabilities
          from operations of Morgan Group Holding Co. .............       --        (1,867)      1,888      (1,057)
          distributed to shareholders
        Changes in operating assets and liabilities:
             Receivables ..........................................       (399)       (581)        656         101
             Accounts payable and accrued liabilities .............      2,085       2,888       3,259         823
             Other ................................................        (81)        711      (1,081)       (516)
                                                                       --------   --------    --------    ---------
     NET CASH PROVIDED BY OPERATING ACTIVITIES ....................      7,962       9,599      19,237      16,371
                                                                       --------    --------   --------    ---------

     INVESTING ACTIVITIES
     Capital expenditures .........................................     (6,580)     (5,427)    (14,374)    (12,982)
     Investment in and advances to affiliated entities ............      2,013           1         101        (185)
     Proceeds from sale of available for sale securities ..........       --           253         398         494
     Proceeds from sale of cellular partnership ...................       --          --         5,570        --
     Acquisition of Central Utah Telephone Company (total
      cost, less debt assumed and cash equivalents acquired) ......       --          --          --        (6,889)
     Investing activities of operations of Morgan Group
       Holding Co. distributed to shareholders ....................       --        (3,582)       --        (3,681)
     Other ........................................................       (127)       (255)       (202)       (377)
                                                                       --------   --------    --------    ---------
     NET CASH USED IN INVESTING ACTIVITIES ........................     (4,694)     (9,010)     (8,507)    (23,620)
                                                                       --------   ---------   ---------   ---------
     FINANCING ACTIVITIES
     Issuance of long term debt ...................................      3,076        (220)      5,041      27,148
     Repayments of long term debt .................................     (3,047)     (2,775)    (10,652)    (21,148)
     Net repayments (borrowings) lines of credit ..................     (2,032)      5,047         408       4,314
     Treasury stock transactions ..................................       (172)         11        (863)         11
     Investment in restricted cash ................................        (46)       --        (3,029)       --
     Financing activities of operations of Morgan Group Holding
       Co. distributed to shareholders ............................       --         3,200        --         3,081
     Other ........................................................       --          --            39        --
                                                                       --------   ---------   --------    --------
     NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES
                                                                       (2,221)      5,263      (9,056)      13,406
                                                                      --------    --------    --------    ---------
    Net increase in cash and cash equivalents ....................      1,047       5,852       1,674        6,157
     Cash and cash equivalents at beginning of Period .............     24,291      25,139      23,664      24,834
                                                                      --------    --------    --------    ---------
     CASH AND CASH EQUIVALENTS AT END OF PERIOD ...................   $ 25,338    $ 30,991    $ 25,338    $ 30,991
                                                                      ========    ========    ========    =========
</TABLE>
See accompanying notes.
                                       3
<PAGE>
<TABLE>


                  LYNCH INTERACTIVE CORPORATION & SUBSIDIARIES

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

A.   Subsidiaries of the Registrant

As of September 30, 2002, the Subsidiaries of the Registrant are as follows:
<CAPTION>

Subsidiary                                        Owned by Lynch

<S>                                                  <C>
Brighton Communications Corporation ............     100.0%
  Lynch Telephone Corporation IV ...............     100.0%
    Bretton Woods Telephone Company ............     100.0%
    World Surfer, Inc. .........................     100.0%
  Lynch Broadband Corporation ..................     100.0%
  Lynch Telephone Corporation VI ...............      98.0%
    JBN Telephone Company, Inc. ................      98.0%
      JBN Finance Corporation ..................      98.0%
      CLR Video, L.L.C .........................      98.0%
    Giant Communications, Inc. .................     100.0%
    Lynch Telephone Corporation VII ............     100.0%
      USTC Kansas, Inc. ........................     100.0%
       Haviland Telephone Company, Inc. ........     100.0%
        Haviland Finance Corporation ...........     100.0%
  DFT Communications Corporation ...............     100.0%
     DFT Telephone Holding Company, L.L.C ......     100.0%
    Dunkirk & Fredonia Telephone Company .......     100.0%
      Cassadaga Telephone Company ..............     100.0%
        Macom, Inc. ............................     100.0%
      Comantel, Inc. ...........................     100.0%
        Erie Shore Communications, Inc. ........     100.0%
        D&F Cellular Telephone, Inc. ...........     100.0%
    DFT Long Distance Corporation ..............     100.0%
    DFT Local Service Corporation ..............     100.0%
    DFT Security Services, Inc. ................     100.0%
  LMT Holding Corporation ......................     100.0%
    Lynch Michigan Telephone Holding Corporation     100.0%
        Upper Peninsula Telephone Company ......     100.0%
        Alpha Enterprises Limited ..............     100.0%
          Upper Peninsula Cellular North, Inc. .     100.0%
          Upper Peninsula Cellular South, Inc. .     100.0%

  Lynch Telephone Corporation IX ...............     100.0%
    Central Scott Telephone Company ............     100.0%
        CST Communications Inc. ................     100.0%
  Global Television, Inc. ......................     100.0%
  Inter-Community Acquisition Corporation ......     100.0%

  Lynch Telephone Corporation X ................     100.0%
     Central Utah Telephone, Inc. ..............     100.0%
     Central Telecom Services, LLC .............     100.0%
        Cache Valley Wireless, LC ..............     100.0%
</TABLE>
                                       4
<PAGE>
<TABLE>
<CAPTION>

<S>                                         <C>
Subsidiary
                                            Owned by Lynch

  Lynch Entertainment, LLC .................     100.0%
  Lynch Entertainment Corporation II .......     100.0%

  Lynch Multimedia Corporation .............     100.0%

  Lynch Paging Corporation .................     100.0%

Lynch PCS Communications Corporation .......     100.0%
  Lynch PCS Corporation A ..................     100.0%
  Lynch PCS Corporation F ..................     100.0%
  Lynch PCS Corporation G ..................     100.0%
  Lynch PCS Corporation H ..................     100.0%

Lynch Telephone Corporation ................      83.1%
  Western New Mexico Telephone Company, Inc.      83.1%
  Interactive Networks Corporation .........      83.1%
  WNM Communications Corporation ...........      83.1%
  WNM Interactive, L.L.C ...................      83.1%
  Wescel Cellular, Inc. ....................      83.1%
    Wescel Cellular of New Mexico, L.P. ....      42.4%
  Wescel Cellular, Inc. II .................      83.1%
      Enchantment Cable Corporation ........      83.1%
Lynch Telephone II, LLC ....................     100.0%
  Inter-Community Telephone Company, LLC ...     100.0%
  Valley Communications, Inc. ..............     100.0%
Lynch Telephone Corporation III ............      81.0%
  Cuba City Telephone Exchange Company .....      81.0%
  Belmont Telephone Company ................      81.0%
</TABLE>



                                       5
<PAGE>


B.   Basis of Presentation

The  Company  consolidates  the  operating  results of its  telephone  and cable
television  subsidiaries  (81-100%  owned at September 30, 2002 and December 31,
2001). All material intercompany transactions and balances have been eliminated.
Investments  in affiliates in which the Company does not have a majority  voting
control are  accounted  for in accordance  with the equity  method.  The Company
accounts  for  the  following  affiliated  companies  on  the  equity  basis  of
accounting:  Coronet Communications Company (20% owned at September 30, 2002 and
December 31, 2001), Capital Communications Company, Inc. (49% owned at September
30, 2002 and December 31, 2001) and the cellular  partnership  operations in New
Mexico (17% to 21% owned at September 30, 2002 and December 31, 2001).

On January 24, 2002, Interactive spun off its interest in The Morgan Group, Inc.
("Morgan"),  its  only  services  subsidiary,  via a  tax-free  dividend  to its
shareholders  of the stock of Morgan Group Holding Co., a  corporation  that was
formed to serve as a holding company for Interactive's  controlling  interest in
Morgan.  Morgan  Group  Holding Co. is now a public  company.  Accordingly,  the
amounts  for  Morgan  are  reflected  on  a  one-line  basis  in  the  condensed
consolidated  financial statements as of December 31, 2001 and for the three and
nine months  ended  September  30,  2002 and 2001,  as amounts  "distributed  to
shareholders."

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance  with  accounting  principles  generally  accepted in the
United States for interim  financial  information  and with the  instructions to
Form 10-Q and Articles 10 and 11 of  Regulation  S-X.  Accordingly,  they do not
include all of the information and footnotes  required by accounting  principles
generally  accepted in the United States for complete financial  statements.  In
the opinion of  management,  all  adjustments  (consisting  of normal  recurring
accruals)  considered  necessary  for a fair  presentation  have been  included.
Operating results for the three and nine-month  periods ended September 30, 2002
are not necessarily  indicative of the results that may be expected for the year
ending December 31, 2002. The preparation of consolidated  financial  statements
in conformity with accounting principles generally accepted in the United States
requires  management to make estimates and  assumptions  that effect the amounts
reported in the financial  statements  and  accompanying  notes.  Actual results
could differ from those estimates.

Certain 2001 amounts have been reclassified to conform to the 2002 presentation.

C.   Recent Accounting Pronouncements

In June 2001,  the Financial  Accounting  Standards  Board issued  Statements of
Financial  Accounting  Standards No. 141,  Business  Combinations,  and No. 142,
Goodwill and Other Intangible Assets, effective for fiscal years beginning after
December 15, 2001. Statement 141 required that the purchase method of accounting
be used for all  business  combinations  initiated  after  September  30,  2001.
Statement 141 also includes guidance on the initial  recognition and measurement
of goodwill  and other  intangible  assets  arising from  business  combinations
completed  after June 30, 2001.  Statement  142 prohibits  the  amortization  of
goodwill and assets with  indefinite  lives.  Statement  142 requires that these
assets be reviewed for  impairment  at least  annually.  Intangible  assets with
finite lives will continue to be amortized over their estimated useful lives.

The Company tests goodwill for impairment using the two-step process  prescribed
in Statement 142. The first step is a screen for potential impairment, while the
second step measures the amount of impairment, if any. The Company performed the
first  of the  required  impairment  tests  of  goodwill  and  indefinite  lived
intangible  assets as of  January  1,  2002 in the  second  quarter  of 2002 and
determined that there are no impairments at the current time.
                                       6
<PAGE>

The  application  of the  non-amortization  provisions  of Statement No. 142 has
increased net income in the third quarter of 2002 by approximately  $0.6 million
($0.22 per basic share) whereas the similar  amortization charge for the quarter
in 2001 was  approximately  $0.7 million  ($0.23 per basic share).  For the nine
months ended  September  30, 2002 and 2001,  the amounts were $1.9  million,  or
$0.68 in basic earning per share,  and $1.7  million,  or $0.61 in basic earning
per share, respectively.

The  following  table  discloses  what the  effects of the  non-amortization  of
goodwill  and  indefinite  lived  intangible  assets would be for income and per
share amounts for the periods displayed:
<TABLE>
<CAPTION>

                                                 Three Months Ended     Nine Months Ended
                                                    September 30,         September 30,
                                                    2002       2001      2002     2001
                                                 ------------------------------- --------
As reported:                                           (000s)               (000s)
<S>                                              <C>         <C>        <C>      <C>
    Income (loss) from continuing operations .   $ (1,872)   $ 1,785    $3,306   $ 3,366
     (Loss) from operations of Morgan ........       --         (190)   (1,888)     (143)
                                                 --------    -------    ------   -------
    Net Income (loss) ........................   $ (1,872)   $ 1,595    $1,418   $ 3,223
                                                 ========    =======    ======   =======
Adjustment from non-amortization
    Continuing operations net of income taxes
    of $0, $74, $0, $221 and minority interest
    of $0, $15, $0, $31, respectively ........       --      $   678      --     $ 1,719
    Operations of Morgan, net of minority
       interests and income taxes ............       --      $    73      --     $   214

As adjusted:
    Income (loss) from continuing operations .   $ (1,872)   $ 2,463    $3,306   $ 5,085
    Income (loss) from operations of Morgan ..       --         (117)   (1,888)       71
                                                 --------    -------    ------   -------
    Net income ...............................   $ (1,872)   $ 2,346    $1,418   $ 5,156
                                                 ========    =======    ======   =======

Basic earnings per share
    Income (loss) from continuing operations .   $  (0.67)   $  0.87    $ 1.18   $  1.80
    Income (loss) from operations of Morgan ..       --        (0.04)    (0.68)     0.03
                                                 --------    -------    ------   -------
    Net Income (loss) ........................   $  (0.67)   $  0.83    $ 0.50   $  1.83
                                                 ========    =======    ======   =======
Diluted earnings per share
    Income (loss) from continuing operations .   $  (0.67)   $  0.87    $ 1.18   $  1.80
    Income (loss) from operations of Morgan ..       --        (0.04)    (0.68)     0.03
                                                 --------    -------    ------   -------
    Net income (loss) ........................   $  (0.67)   $  0.83    $ 0.50   $  1.83
                                                 ========    =======    ======   =======

</TABLE>
                                       7
<PAGE>

The following tables display the details of goodwill and intangible assets as of
the dates shown.
<TABLE>
<CAPTION>

                                                                        (000s)
                                                 September 30, 2002               December 31, 2001
                                              --------------------------------------------------------
                                                                Accumulated                    Accumulated
Intangible assets subject to amortization:     Assets          Amortization     Assets         Amortization
                                              ----------------- ---------------- -------------- -----------
<S>                                           <C>                  <C>          <C>              <C>
Subscriber lists ......................       $7,629               $2,192       $7,194           $  986
</TABLE>
<TABLE>
<CAPTION>

                                            2002     2001
                                            ----     ----

Total amortization expense for
<S>                                       <C>      <C>
  the three months ended September 30 .   $  422   $  764
                                           ======   ======
Total amortization expense for the nine
  months  ended September 30 ..........   $1,206   $1,991
                                           ======   ======
</TABLE>
<TABLE>
<CAPTION>


                                               2003      2004     2005      2006      2007
                                          ---------------------------------------------------
<S>                                         <C>        <C>       <C>       <C>       <C>
Estimated aggregate amortization
expense by year .........................   $ 1,691    $ 1,580   $   275   $   213   $   213
</TABLE>
<TABLE>
<CAPTION>

                                                     September 30,  December 31,
                                                         2002         2001
                                                       -------       -------
<S>                                                   <C>            <C>

Intangible assets not subject to amortization:
    Goodwill ..................................       $60,889        $60,889
    Cellular licenses .........................         1,650          1,650
</TABLE>

In October 2001, the FASB issued Statement of Financial  Accounting Standard No.
144,  Accounting for the Impairment or Disposal of Long-Lived Assets,  effective
for fiscal years  beginning  after  December  15, 2001.  The FASB's new rules on
asset impairment supersede FASB Statement No. 121, Accounting for the Impairment
of Long-Lived  Assets and for Long-Lived Assets to be Disposed of, and provide a
single  accounting  model for  long-lived  assets to be  disposed  of.  Although
retaining many of the fundamental recognition and measurement provisions of FASB
Statement  No. 121, the new rules  significantly  change the criteria that would
have to be met to  classify an asset as  held-for-sale.  The new rules also will
supersede the  provisions of APB Opinion 30 with regard to reporting the effects
of a disposal  of a segment  of a  business  and will  require  expected  future
operating  losses from  discontinued  operations to be displayed in discontinued
operations  in the periods in which the losses are  incurred  (rather than as of
the  measurement  date as  presently  required  by APB 30).  In  addition,  more
dispositions  will qualify for discontinued  operations  treatment in the income
statement.  The Company has determined that there is no effect of FASB Statement
No. 144 on the earnings and financial position of the Company.

D.   Acquisitions and Dispositions

On June 22, 2001,  Lynch  Telephone  Corporation X, a subsidiary of Interactive,
acquired Central Utah Telephone, Inc. and its subsidiaries,  and Central Telecom
Services,  LLC, a related entity,  for  approximately  $15.6 million in cash and
notes. The Company has recorded approximately $11.5 million in goodwill.

The above  acquisition  was accounted for as a purchase,  and  accordingly,  the
assets  acquired and  liabilities  assumed were recorded at their estimated fair
market values on the date of acquisition.
                                       8
<PAGE>

The operating  results of the acquired  companies are included in the Statements
of Operations  from the  acquisition  date.  The  following  unaudited pro forma
information  shows  the  results  of the  Company's  operations  as  though  the
acquisition of Central Utah and related  entities and the distribution of Morgan
were made at the beginning of 2001.  The unaudited pro forma  information is not
necessarily indicative of the results of operations that would have occurred had
the  transactions  been made at this date nor is it  necessarily  indicative  of
future results of operations. (In thousands of dollars, except per share data).
<TABLE>
<CAPTION>

                                     Nine Months
                                       Ended
                                    September 30,
                                        2001
                                  ----------------
<S>                                 <C>
Sales and revenues ..............   $   62,321
Income from continuing operations        3,511
Basic earnings per share ........         1.24
Diluted earnings per share ......         1.24
</TABLE>

In March 2002,  the Company sold its 20.8%  interest in the New Mexico  cellular
partnership,  RSA #1B, to Verizon  Wireless for $5.6 million ($5 million pre-tax
gain) and repaid $2.6 million of outstanding indebtedness to Verizon.

E.   Sunshine PCS Corporation

In October 2002, the Company agreed to restructure  it's  investment in Sunshine
PCS  Corporation  ("Sunshine")  by exchanging  $18.5 million of the  subordinate
notes  receivable  from Sunshine for two separate  classes of preferred stock of
Sunshine,  one with a  liquidation  value of $12.5  million  and a second with a
liquidation  value of $2.0 million.  The second class of preferred stock will be
convertible into Sunshine's Class A Common Stock at $1.00 per share. As the book
value of the Company's investment in Sunshine,  including the subordinate notes,
is $3.0 million no profit or loss was recorded as a result of this exchange.

In February 2002,  Sunshine PCS Corporation issued rights to its shareholders to
purchase up to 1,531,593  shares of its Class A Common Stock at a price of $1.00
per share.  On May 3,  2002,  the rights  offering  expired  and on May 7, 2002,
Sunshine announced that the rights offering was oversubscribed. As the holder of
235,294  shares of  Sunshine,  Interactive  exercised  its  rights  (but did not
oversubscribe)  to purchase  58,824 shares of Class A Common Stock in the rights
offering.

F.   Investment in Spectrum Holders

The Company has made loans to and has investments in PTPMS  Communications,  LLC
II,  totaling $6.1 million.  PTPMS II acquired  wireless  spectrum in an auction
conducted by the Federal  Communications  Commission  in 2000 called the 700 MHz
Guard Band Auction.  In a recently  conducted FCC auction for similar  spectrum,
which ended on September  18, 2002 , the Lower 700 MHz Band  Auction,  the price
per MHz of population  was  materially  lower than the price paid by PTPMS II in
2000.  Accordingly,  during the third  quarter of 2002,  Interactive  provided a
reserve for impairment for its investment in PTPMS II of $5.5 million, resulting
in a net book value, at September 30, 2002, of $0.7 million.

In addition the Company has an  investment in separate  affiliates  who acquired
wireless  spectrum  in a  different  auction in 2000,  the 39 GHz  Auction.  The
Company's  loans to investment in this affiliate is $1.5 million.  While trading
in the public markets for companies that own and operate  wireless  Spectrum has
declined  substantially since the end of these Auctions,  there is no indication
that the value of this Spectrum has declined due in part, to the limited trading
of these  licenses.  The  Company  will  closely  monitor  the results of future
auctions and non auction sales and will provide a reserve for impairment  should
the results warrant.
                                       9
<PAGE>

During the quarter ended September 30, 2002, the Company, through a wholly-owned
subsidiary,  participated in an auction for wireless  spectrum,  the above noted
Lower 700 MHz Band  Auction.  The Company was high  bidder for  licenses  with a
total cost of $1.1  million.  The Company has on deposit  $0.2 million for these
licenses  and will be  required  to pay the  remainder  when the FCC  issues the
licenses which should occur in 2002 or early 2003.

G    Spin-off of Morgan

On January 24,  2002,  Interactive  spun off its  interest in The Morgan  Group,
Inc., its only services subsidiary,  via a tax-free dividend to its shareholders
of the stock of Morgan Group Holding Co., a corporation that was formed to serve
as a holding company for Interactive's controlling interest in The Morgan Group,
Inc.  Morgan Group Holding Co. is now a public company.  Morgan's  revenues were
$46.4  million  ($5.4  million to date of  spin-off) in the first nine months of
2002 and $81.7  million  in the first  nine  months of 2001.  The net  assets of
Morgan distributed at the spin-off were approximately $3.5 million.

Accordingly, prior period financial statements have been restated to reflect the
amounts for Morgan on a one-line basis as "distributed to shareholders."

The report of Ernst & Young LLP, Morgan's independent auditors at the time, with
respect to its financial  statements  as of December 31, 2001 and 2000,  and for
each of the three  years in the period  ended  December  31, 2001  contained  an
explanatory  paragraph which expresses  substantial doubt as to Morgan's ability
to continue as a going concern.

On  October  18,  2002,  Morgan  and  two of its  operating  subsidiaries  filed
voluntary  petitions under Chapter11 of the United States Bankruptcy Code in the
United States Bankruptcy Court for the Northern District of Indiana,  South Bend
Division, for the purpose of conducting an orderly liquidation of its assets.

H.   Indebtedness

The parent company maintains a short-term line of credit facility totaling $10.0
million.  Borrowings  under this  facility were $7.9 million and $7.6 million at
September  30, 2002 and December  31, 2001,  respectively.  This  facility  will
expire on August 31, 2003. Long-term debt consists of (all interest rates are at
September 30, 2002):
                                       10
<PAGE>

<TABLE>
<CAPTION>

                                                                                   September 30,
                                                                                       2002            December 31,
                                                                                    (Unaudited)            2001
                                                                                 ------------------   ---------------
                                                                                              (In thousands)
<S>                                                                                <C>                   <C>
Rural Electrification  Administration (REA) and Rural Telephone Bank (RTB) notes
payable  through  2027 at fixed  interest  rates  ranging  from 2% to 7.5%(5%
weighted  average at September 30, 2002), secured by assets of the  telephone

companies of $152.8 million ....................................................   $  57,379            $  55,499
Bank Credit  facilities  utilized by certain  telephone  and  telephone  holding
companies  through 2016,  $31.2 million at fixed interest  rates  averaging 7.9%
and $50.8 million at variable interest rates averaging 4.8%  ...................      82,007               87,127

Unsecured  notes issued in connection with  acquisitions  through 2006, at fixed
interest rates of 10.0% ........................................................      34,903               34,512

Convertible  subordinated  note due in December 2004 at a fixed interest rate of
6%..............................................................................      10,000               10,000
Other ..........................................................................       3,324                6,064
                                                                                   ---------            ---------
                                                                                     187,613              193,202
Current maturities .............................................................     (26,981)             (28,126)
                                                                                   ---------            ---------
                                                                                   $ 160,632            $ 165,076
                                                                                   =========            =========
</TABLE>

On December  12,  1999,  the Company  completed  the private  placement of a $25
million 6% five-year note,  convertible into Interactive  common stock at $42.50
per share.  At that time,  to assist the Company  with the private  placement to
Cascade  Investment LLC ("Cascade"),  the Chairman and CEO of Interactive agreed
to give the  acquirer  of the note a one-time  option to sell the note to him at
105% of the principal amount thereof.  The exercise period was from November 15,
2000 to December 1, 2000.  The  obligation of the Chairman  under this option to
sell  agreement  was secured by a bank  letter of credit,  which,  in turn,  was
secured by a pledge of certain  securities  of the  Chairman.  The Company  also
agreed to  reimburse  the Chairman for the cost of the letter of credit plus his
counsel fees in connection  with the option to sell  agreement and obtaining the
letter of credit.

On January  16,  2001,  the option to sell  agreement  between  Cascade  and the
Company's   Chairman  was  modified  and  extended.   As  a  condition  to  such
modification  and extension,  Cascade demanded and obtained the right to sell up
to $15  million of the notes back to the  Chairman  at any time prior to January
31,  2001 and the right to sell the  remaining  $10  million of the notes to the
Chairman  between  November 15 and December 1, 2002 (the  "Put").  The Put is at
105% of principal amount sold plus accrued and unpaid interest and is secured by
a fully collateralized letter of credit.

In order to induce the  Chairman to grant the Put,  the Company  entered into an
agreement in December  2000 with its  Chairman  whereby it agreed (i) to pay for
and acquire,  on the same terms and conditions,  any portion of the note sold by
Cascade  under  the Put,  (ii) to  reimburse  the  Chairman  for the  costs  for
extending and  maintaining the letter of credit and (iii) to pay the Chairman or
his assigns a  collateral  maintenance  fee of 10% per annum for any  collateral
provided by them.

During January 2001, Cascade exercised the Put with regard to the $15 million of
the notes and on February 14, 2001,  the Company  transferred  $15.9  million to
Cascade,  including the 5% premium plus accrued and unpaid interest, in exchange
for $15.0 million of the notes held by Cascade.
                                       11
<PAGE>

The  option to sell the  remaining  $10  million  continues  to be  secured by a
collateralized  letter of credit.  Until March 31, 2002, all or a portion of the
collateral for the letter of credit was provided by an affiliate of the Chairman
and, as noted  above,  the  Company had agreed to pay all legal fees,  letter of
credit  fees and a 10% per annum  collateral  fee on the  amount  of  collateral
provided.  As the Company has always had the right to substitute  its collateral
for that  provided,  as of March 31,  2002,  the Company had replaced all of the
$10.5  million of the  collateral  provided by an affiliate of the Chairman with
$10.5 million of the Company's U.S.  Treasury Bills,  which have been pledged to
the issuers of the letter of credit and are classified as  "Restricted  Cash" on
the Company's balance sheet.

The balance of the  convertible  subordinated  note is  classified as current at
September  30, 2002,  and  December  31, 2001,  as the holder has the ability to
demand payment of such amount, plus the $0.5 million premium,  prior to December
31, 2002. It is Management's  belief that the Put will be exercised with respect
to the remaining $10 million of notes outstanding prior to December 31, 2002.

I.   Comprehensive Income

Balances of accumulated other  comprehensive  income, net of tax, which consists
of unrealized  gains (losses) on available for sale of securities,  at September
30, 2002 and December 31, 2001 are as follows (in thousands):
<TABLE>
<CAPTION>

                                  Unrealized
                                  Gain (Loss) Tax Effect   Net
                                  ----------- ---------- -------
<S>                                <C>        <C>        <C>
Balance at December 31, 2001 ...   $ 2,599    $(1,057)   $ 1,542
Reclassification adjustment ....      (374)       146       (228)
Current period unrealized losses    (1,918)       785     (1,133)
                                   -------    -------    -------
Balance at September 30, 2002      $   307    $  (126)   $   181
                                   =======    =======    =======
</TABLE>

The  comprehensive  income  (loss),  for the three and nine month  periods ended
September 30, 2002 and 2001 are as follows (in thousands):
<TABLE>
<CAPTION>

                                                                               Three Months Ended
                                                                                  September 30,
                                                                             ---------------------
                                                                              2002        2001
                                                                             ---------------------

<S>                                                                             <C>        <C>
Net income (loss) for the period .........................................      $(1,872)   $ 1,595
Reclassification adjustment-net of income tax benefit of $326 ............         --         (449)
Unrealized gains (losses) on available for sale securities - net of income
tax (provision) (benefit) of $206 and $(498), respectively ...............         (286)       685
                                                                                -------    -------
  Comprehensive income (loss) ............................................      $(2,158)   $ 1,831
                                                                                =======    =======
</TABLE>
<TABLE>
<CAPTION>

                                                                               Nine Months Ended
                                                                                September 30,
                                                                              2002         2001
                                                                             ---------------------

<S>                                                                             <C>        <C>
Net income for the period ...................................................   $ 1,418    $ 3,223
Reclassification  adjustment-net  of income tax  benefit of $146 and $1,099,
respectively ................................................................      (228)    (1,514)
Unrealized  gains  (losses) on available for sale  securities - net of income
tax (provision) benefit of $785 and $462, respectively ......................    (1,133)       633
                                                                                -------    -------
  Comprehensive income ......................................................   $    57    $ 2,342
                                                                                =======    =======
</TABLE>
                                       12
<PAGE>


J.       Earnings per share

The following table set forth the computation of basic and diluted  earnings per
share for the periods  indicated:  During the nine months  ended  September  30,
2002,  the Company  purchased  23,800  shares of its common stock for  treasury.
Subsequent to September  30, 2002,  the Company  purchased an  additional  1,900
shares of Treasury stock.
<TABLE>
<CAPTION>

                                                   Three Months Ended             Nine Months Ended
                                                     September 30,                  September 30,
                                                 2002           2001           2002            2001
                                              --------------- ------------- --------------- ---------------
Basic earnings per share
Numerator:
<S>                                            <C>            <C>           <C>           <C>
      Net Income (Loss) ....................   $(1,872,000)   $ 1,595,000   $ 1,418,000   $ 3,223,000
Denominator:
      Weighted average shares outstanding ..     2,799,000      2,822,000     2,809,000     2,822,000
Earnings per share:
      Net income (loss) ....................     $ ( 0.67)    $      0.57   $      0.50   $      1.14
                                               ===========    ===========   ===========   ===========

Diluted earnings per share
Numerator:
     Net Income (loss) .....................   $(1,872,000)   $ 1,595,000   $ 1,418,000   $ 3,223,000
     Interest saved on assumed conversion of
        convertible  notes - net of tax ....          --             --            --            --
                                               -----------    -----------   -----------   -----------

     Net Income (Loss) .....................   $(1,872,000)   $ 1,595,000   $ 1,418,000   $ 3,223,000
                                               -----------    -----------   -----------   -----------

Denominator:
      Weighted average shares outstanding ..     2,799,000      2,822,000     2,809,000     2,822,000
      Shares issued on assumed conversion of
         convertible note ..................          --             --            --            --
                                               -----------    -----------   -----------   -----------
      Weighted average shares and share
         equivalents .......................     2,799,000      2,822,000     2,809,000     2,822,000
                                               -----------    -----------   -----------   -----------

Earnings per share:
      Net income (loss) ....................   $     (0.67)   $      0.57   $      0.50   $      1.14
                                               ===========    ===========   ===========   ===========
</TABLE>

For all periods presented,  the 235,294 shares to be issued on conversion of the
Company's  convertible  note  (see  note H) have  been  excluded  because  their
inclusion would be anti-dilutive.

K.   Segment Information

As a result of the decision to spin-off its  investment  in Morgan (see Note G),
the Company is engaged in one business segment:  multimedia.  All businesses are
located domestically, and substantially all revenues are domestic. The Company's
operations include local telephone companies, a cable TV company,  investment in
PCS entities and investment in two  network-affiliated  television stations. The
Company's  primary  operations  are  located  in the  states  of  Iowa,  Kansas,
Michigan, New Hampshire, New Mexico, New York, North Dakota, Utah and Wisconsin.
75%  of  the  Company's  telephone  customers  are  residential.  The  remaining
customers are businesses.

EBITDA  (before  corporate  allocation)  for  operating  segments  is  equal  to
operating  profit  before  interest,  taxes,   depreciation,   amortization  and
allocated  corporate  expenses.  EBITDA  is  presented  because  it is a  widely
accepted  financial  indicator  of value and ability to incur and service  debt.
Management  uses EBITDA to evaluate the operating  performance  of the Company's
operations.  EBITDA is not a substitute for operating  income or cash flows from
operating   activities  in  accordance   with  generally   accepted   accounting
principles.
                                       13
<PAGE>

Operating profit (loss) is equal to revenues less operating expenses,  including
unallocated general corporate expenses and excluding, interest and income taxes.
The  Registrant  allocates  a portion of its general  corporate  expenses to its
operating  segment.  Such  allocation  was  $327,000  and $301,000 for the three
months ended September 30, 2002 and 2001, respectively and $982,000 and $903,000
for the nine months ended September 30, 2002 and 2001, respectively.
<TABLE>
<CAPTION>

                                                         Three Months Ended             Nine Months Ended
                                                           September 30,                  September 30,
                                                        2002           2001            2002          2001
                                                   ------------------------------- -----------------------------
                                                             Unaudited
                                                                          (In thousands)

<S>                                                  <C>         <C>                 <C>         <C>
Sales and revenues: ..............................   $ 22,983    $ 23,934            $ 65,055    $ 58,594
                                                     ========    ========            ========    ========

EBITDA (before corporate allocation):
  Operations .....................................   $ 11,579    $ 13,950            $ 32,316    $ 31,620
  Corporate expenses, gross ......................       (831)       (624)             (2,276)     (2,199)
                                                     --------    --------            --------    --------
  Combined total .................................   $ 10,748    $ 13,326            $ 30,040    $ 29,421
                                                     ========    ========            ========    ========

Operating profit:
  Operations .....................................   $  6,429    $  8,657            $ 16,928    $ 17,439
  Corporate expenses, net ........................       (538)       (292)             (1,336)     (1,195)
                                                     --------    --------            --------    --------
  Combined total .................................   $  5,891    $  8,365            $ 15,592    $ 16,244
                                                     ========    ========            ========    ========

Operating profit .................................   $  5,891    $  8,365            $ 15,592    $ 16,244
  Other income (expense):
  Gain on sale of cellular partnership ...........       --          --                 4,965        --
  Investment income ..............................        162         200               1,394       2,593
  Interest expense ...............................     (3,240)     (3,865)             (9,911)    (10,697)
  Impairment of investment in Spinnaker
  Industries, Inc. ...............................       --        (1,294)               --        (1,294)
  Reserve for impairment of investment in Spectrum
  license holder .................................     (5,479)       --                (5,479)       --
  Equity in earnings of affiliated companies,
  predominantly cellular operations ..............        429         213                 857         582
                                                     --------    --------            --------    --------
Income  (loss) before income taxes, minority
interests  and  operations of Morgan Group Holding
Co. distributed to shareholders ..................   ($ 2,237)   $  3,619            $  7,418    $  7,428
                                                      ========    ========           ========    ========
</TABLE>

L.   Litigation

Taylor  Litigation.  Interactive and several other parties,  including our Chief
Executive  Officer,  and Fortunet  Communications,  L.P., which was Sunshine PCS
Corporation's  predecessor-in-interest,  have  been  named  as  defendants  in a
lawsuit  brought under the so-called  "qui tam"  provisions of the federal False
Claims Act in the United States District Court for the District of Columbia. The
complaint  was filed  under seal with the court on  February  14,  2001.  At the
initiative  of one of the  defendants,  the seal was lifted on January 11, 2002.
Under the False Claims Act, a private plaintiff,  termed a "relator," may file a
civil action on the U.S. government's behalf against another party for violation
of the  statute.  In return,  the relator  receives a statutory  bounty from the
government's litigation proceeds if he is successful.

The relator in this lawsuit is R.C.  Taylor III, an individual  who, to the best
of  our  knowledge,  has no  relationship  to any  of  the  Lynch  entities  and
affiliates that have been named parties in this  litigation.  Indeed at the time
of his filings,  and to the best of our  knowledge,  Mr.  Taylor was a lawyer at
Gardner,  Carton &  Douglas.
                                       14
<PAGE>
Thereafter, we believe he was a lawyer with a Washington,  D.C., law firm. We do
not know his  current  status.  We  issued a press  release  dealing  with  this
litigation on January 16, 2002.

The  main  allegation  in the case is that the  defendants  participated  in the
creation  of "sham"  bidding  entities  that  allegedly  defrauded  the  federal
Treasury  by  improperly   participating   in  certain  Federal   Communications
Commission  spectrum  auctions  restricted  to  small  businesses,  as  well  as
obtaining  bidding credits in other spectrum  auctions  allocated to "small" and
"very small"  businesses.  The lawsuit seeks to recover an unspecified amount of
damages, which would be subject to mandatory trebling under the statute.

Interactive strongly believes that this lawsuit is completely without merit, and
intends to defend  the suit  vigorously.  The U.S.  Department  of  Justice  has
notified the court that it has declined to intervene in the case.  Nevertheless,
we cannot predict the ultimate outcome of the litigation, nor can we predict the
effect  that the  lawsuit or its  outcome  will have on our  business or plan of
operation.

Interactive  was  formally  served  with  the  complaint  on July 10,  2002.  On
September  19,  2002,  Interactive  filed two  motions  with the  United  States
District Court for the District of Columbia: a motion to dismiss the lawsuit and
a motion to  transfer  the  action to the  Southern  District  of New York.  The
relator has until November 25, 2002, to respond to Interactive's motions.

M.   Write-off of Uncollectible Receivables

During the nine months  ended  September  30, 2002,  the Company  wrote off $0.9
million of receivables,  classified as a "Selling and Administrative  Expenses",
relating to the bankruptcy of MCI/Worldcom and Global Crossing,  $0.2 million of
which was written off during the three months ended September 30, 2002.
                                       15
<PAGE>

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

Sales And Revenues

Revenues for the three months ended September 30, 2002 decreased by $1.0 million
to $23.0  million from the third  quarter of 2001.  During the third  quarter of
2001,  Interactive  recorded a $2.8 million  contingent  administrative  fee for
services  it had  previously  performed  in an auction  for  wireless  spectrum.
Interactive  sporadically  has recorded  this type of fee over the years.  Apart
from this variance,  revenues increased by $1.8 million,  attributable to higher
regulated telephone service,  including  regulatory true -ups, and the provision
of non-traditional  telephone services such as: Internet,  long distance service
and local exchange carrier  service.  The acquisition of American Alarm Company,
which occurred on November 30, 2001  contributed $0.8 million in revenues to the
current year's quarter.

For the nine months ended  September 30, 2002,  revenues were $65.1 million,  an
increase  of $6.5  million  from the $58.6  million  recorded  in the first nine
months  of 2001.  The  acquisition  of  Central  Utah  Telephone,  Inc.  and its
subsidiaries, and Central Telecom Services, L.L.C., a related entity, which were
acquired on June 22,  2001,  contributed  $5.2  million to the  increase and the
acquisition  of American  Alarm added $2.2 million to the  increase.  Offsetting
these increases the absence of an administration fee in 2002,  decreased current
years revenues from the prior years period. In addition,  as a result of certain
regulatory  initiatives in some of the states in which our companies operate, it
is possible that revenues at certain telecommunication operations may be reduced
in the near future.

Operating Profit

Operating profit for the three months ended September 30, 2002 decreased by $2.5
million to $5.9 million from the third quarter of 2001. The  administration  fee
of $2.8 million was the major cause of the variance. The acquisition of American
Alarm  reduced  operating  profit by $0.2 million  during the quarter due to the
amortization of customer  contracts of $0.4 million recorded during the quarter.
The  absence  of  $0.6  million  of  amortization  expense  as a  result  of the
implementation  of SFAS 142 improved the  quarter's  results.  Also,  during the
quarter the Company  recorded  $0.2 million in allowance  for doubtful  accounts
associated with the recent  bankruptcy of MCI/Worldcom.  The bankruptcy  filings
may adversely impact the interstate  revenues pools administered by the National
Exchange Carrier  Association  ("NECA") of which all of the Company's  telephone
operating  subsidiaries  participate.  If the Company's access  settlements from
NECA are reduced, the Company's operating results in the remainder of 2002 could
be materially affected.

For the nine months ended  September 30, 2002,  operating  profits  decreased by
$0.7 million to $15.6 million, also reflecting the absence of the administrative
fee of $2.8 million in 2002. The Central Utah  acquisition  increased  operating
profit by $1.7 million. American Alarm reduced operating profit by $0.2 million,
due  to  the  amortization  of  customer  contracts  of  $1.1  million  and  the
non-amortization   of  goodwill  added  $2.0  million  of  operating  profit  in
comparison to the previous  year. The recording of $0.9 million of write-offs of
receivables also affected the nine month activity.

Other Income (Expense)

The Company has made loans to and has investments in PTPMS  Communications,  LLC
II,  totaling $6.1 million.  PTPMS II acquired  wireless  spectrum in an auction
conducted by the Federal  Communications  Commission  in 2000 called the 700 MHz
Guard Band Auction.  In a recently  conducted FCC auction for similar  spectrum,
which ended on September  18, 2002 , the Lower 700 MHz Band  Auction,  the price
per MHz of population  was  materially  lower than the price paid by PTPMS II in
2000.  Accordingly,  during the third  quarter of 2002,  Interactive  provided a
reserve for impairment for its investment in PTPMS II of $5.5 million, resulting
in a net book value, at September 30, 2002, of $0.7 million.
                                       16
<PAGE>

In addition the Company has an  investment in separate  affiliates  who acquired
wireless  spectrum  in a  different  auction in 2000,  the 39 GHz  Auction.  The
Company's  loans to investment in this affiliate is $1.5 million.  While trading
in the public markets for companies that own and operate  wireless  spectrum has
declined  substantially since the end of these Auctions,  there is no indication
that the value of this spectrum has declined due in part, to the limited trading
of these  licenses.  The  Company  will  closely  monitor  the results of future
auctions and non auction sales and will provide a reserve for impairment  should
the results warrant.

For the three  months  ended  September  30,  2002  investment  income  was down
slightly from the previous year due to lower treasury rates. For the nine months
ended September 30, 2002,  investment  income decreased by $1.2 million from the
prior year period  primarily  due to the  unrealized  gains  recorded in 2001 in
connection with Tremont Advisers,  Inc. All of the Company's interest in Tremont
was sold in October 2001. Offsetting these 2001 gains, there was higher dividend
income on the Company's ownership of bank stocks in 2002.

During  the  first  quarter,  the  Company  sold  its  interest  in  a  cellular
partnership  in New  Mexico  (RSA 1 (North) ) for $5.6  million  resulting  in a
pre-tax gain of $5.0 million.

Interest expense decreased by $0.6 million in the third quarter due primarily to
reduced interest rates, lower levels of borrowings and the absence,  in 2002, of
a  collateral  fee  associated  with  a Put on the  Company's  convertible  debt
outstanding.  Interest  expense  decreased  by $0.8  million for the nine months
ended September 30, 2002, for  essentially the same reasons as the quarter,  but
these  reductions  were offset by increased  interest  expense  associated  debt
incurred for the acquisitions of Central Utah and American Alarm.

Income Tax Provision

The income tax provision  includes federal as well as state and local taxes. The
tax provision for the nine months ended  September 30, 2002 and 2001,  represent
effective  tax  rates  of 43.6%  and  47.8%,  respectively.  The  causes  of the
difference  from the federal  statutory rate are principally the effect of state
income  taxes,  including  the effect of  earnings  and losses  attributable  to
different state jurisdictions,  and the amortization of non-deductible  goodwill
in 2001.

Minority Interests

Minority  interests  decreased  earnings by $185,000  for the three months ended
September 30, 2002 and $185,000 a year earlier as increased  minority  interests
on earnings of telephone  operations  was offset by minority  interest in losses
associated with American Alarm.

For the nine months  ended  September  30,  2002,  minority  interest  decreased
earnings  by $0.9  million  versus $0.5  million  for the period last year.  The
Change was  principally due to minority  interest  associated with the gain from
the sale of RSA 1 (North) in New Mexico.

Net Income (Loss)

The Company  recorded a loss from  continuing  operations  for the three  months
ended  September 30, 2002 of $1.9 million,  $0.67 per share (basic and diluted),
for the third quarter of 2002 compared to income from continuing  operations for
the same  period  last  year of $1.8  million,  or $0.63 per  share  (basic  and
diluted). The reserve for impairment of PCS license holder was the primary cause
of the loss in 2002.
                                       17
<PAGE>

For the nine months ended September 30, 2002 income from  continuing  operations
was $3.3 million, or $1.18 per share (basic and diluted),  as compared to income
from  continuing  operations in 2001 of $3.4 million,  or $1.19 per share (basic
and diluted). Factors contributing to this increase were: the gain from the sale
of RSA 1 (North) in New Mexico, ($2.5 million,  after tax and minority interests
effects)  offset by the reserve for  impairment  of  wireless  spectrum  license
holder ($3.6 million, after tax effects).

Net loss for the three months ended September 30, 2002 was $1.9 million or $0.67
per share  (basic and  diluted) as compared  to net income of $1.6  million,  or
$0.57 per share (basic and diluted),  in the previous years' three-month period.
For the nine months  ended  September  30,  2002 net income was $1.4  million or
$0.50 per share  (basic and  diluted),  as compared to $3.2 million or $1.14 per
(basic and  diluted)  share in the  previous  year.  In  addition to the factors
influencing  the change in income  from  continuing  operations,  the  operating
result of Morgan impacted the net income results.

Morgan Spin-Off

On January 24, 2002,  Interactive  spun off its  investment in The Morgan Group,
Inc. ("Morgan"),  its only services  subsidiary,  via a tax-free dividend to its
shareholders  of the stock of Morgan Group Holding Co., a  corporation  that was
formed to serve as a holding company for Interactive's  controlling  interest in
Morgan.  Morgan Group Holding Co. is now a public  company.  The Company retains
234,294  shares of Morgan  Group  Holding  Co. in escrow to be  provided  to the
holder(s)  of the  Company's  convertible  notes at the time of the  conversion.
Accordingly,  the amounts for Morgan are  reflected  on a one-line  basis in the
condensed  financial  statements  as of December 31,  2001,  and for the periods
ended September 30, 2002 and 2001 as "distributed to shareholders."

FINANCIAL CONDITION

Liquidity/Capital Resources

As of September  30, 2002,  the Company had current  assets of $51.6 million and
current  liabilities of $59.3 million.  Working capital deficiency was therefore
$7.7 million as compared to $10.3  million at December  31, 2001,  net of Morgan
amounts.

For the nine  months,  capital  expenditures  were $14.4  million in 2002 versus
$13.0 million in 2001.

At September  30, 2002,  total debt was $198.4  million,  which was $5.2 million
lower than the $203.5  million at the end of 2001. At September 30, 2002,  there
was $134.7  million of fixed interest rate debt averaging 7.0% and $63.7 million
of variable  interest rate debt averaging  4.9%.  Debt at year-end 2001 included
$137.1 million of fixed interest rate debt, at an average interest rate of 7.0%,
and $66.4 million of variable interest rate debt, at an average interest rate of
4.8%.

Cascade  Investment,  LLC has the  right to elect  to sell the  outstanding  $10
million  in  principal  amount  of the  Company's  6%  convertible  notes to the
Company's  Chairman  between  November 15 and December 1, 2002 (the  "Put").  In
order to induce the Chairman to grant the Put, Company entered into an agreement
in December 2000 with its Chairman whereby it agreed to pay for and acquire,  on
the same terms and conditions, any portion of the note sold by Cascade under the
Put. Based on recent communications  between Cascade and the Company's Chairman,
the Company expects Cascade to exercise the Put. The Put is at 105% of principal
amount  sold plus  accrued and unpaid  interest  and,  accordingly,  the Company
expects to reacquire the outstanding  notes for  approximately  $10.5 million in
December 2002.

As of September  30, 2002,  Interactive,  the parent  company,  had $2.1 million
available under a $10 million short-term line of credit facility,  which expires
on August 31, 2003.
                                       18
<PAGE>

Lynch  has  not  paid  any  cash  dividends  on its  common  stock  since  1989.
Interactive  does not expect to pay cash  dividends  on its Common  Stock in the
foreseeable  future.  Interactive  currently intends to retain its earnings,  if
any,  for use in its  business.  Future  financings  may limit or  prohibit  the
payment of dividends.

During the quarter ended September 30, 2002, the Company, through a wholly-owned
subsidiary,  participated in an auction for wireless spectrum, the Lower 700 MHz
Band Auction. The Company was high bidder for licenses with a total cost of $1.1
million.  The Company has on deposit $0.2 million for these licenses and will be
required to pay the  remainder  when the FCC issues the  licenses  which  should
occur in 2002 or late 2003.

Interactive has a high degree of financial  leverage.  As of September 30, 2002,
the ratio of total debt to equity was 9.8 to 1. Certain  subsidiaries  also have
high  debt to equity  ratios.  In  addition,  the debt at  subsidiary  companies
contains  restrictions  on the  amount of  readily  available  funds that can be
transferred to the respective parent of the subsidiaries.

The Company has a need for resources  primarily to fund future  long-term growth
objectives.   Interactive  considers  various  alternative  long-term  financing
sources:  debt, equity, or sale of an investment asset. While management expects
to obtain  adequate  financing  resources  to  enable  the  Company  to meet its
obligations,  there is no  assurance  that such can be  readily  obtained  or at
reasonable costs.

The Company is obligated under long-term debt provisions and lease agreements to
make certain cash payments over the term of the agreements.  The following table
summarizes these contractual obligations for the period shown:
<TABLE>
<CAPTION>

                                                                       Payments Due by Period
                                                                           (In thousands)
                                                               Less than
                                      Total       1 year (b)   2 - 3 years  4 - 5 years    After 5 years
                                     -------------------------------------------------------------------

<S>                                  <C>           <C>         <C>          <C>            <C>
Long-term Debt (a) ...............   $187,613      $ 26,981    $ 45,564     $ 48,609       $ 66,459

Operating Leases .................      1,306           321        564           321            100

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

Total Contractual Cash Obligations   $188,919      $ 27,302    $ 46,128     $ 48,930       $ 66,559
                                     ========      ========    ========     ========       ========
</TABLE>

(a)  Does not  include  interest  payments on debt

(b)  Includes  $10 million of
     convertible  subordinated  debt due in 2004,  that has a put option that if
     exercised, as management currently expects would accelerate the debt to the
     last quarter of 2002.

The company has certain  financing  commitments  from banks and other  financial
institutions  that  provide  liquidity.   The  following  table  summarizes  the
expiration of these commitments for the periods shown:
<TABLE>
<CAPTION>

                                                                   Amount of Commitment Expiration
                                                                             Per Period
                                                                           (In thousands)

                                 Total
                                 Amounts  Less than
Other Commercial Commitments    Committed  1 year    1 - 3 years    4 - 5 years    Over 5 years
                               ------------------------------------------------------------------

<S>                              <C>       <C>         <C>            <C>            <C>
Lines of Credit ............     $10,744   $10,744        -             -                 -
Standby Letter of Credit ...      10,500    10,500        -             -                 -
                                 -------   -------     -------        -------         -------

Total Commercial Commitments     $21,244   $21,244        -             -                 -
                                 =======   =======    ========        ========        ========
</TABLE>
                                       19
<PAGE>


The Company has initiated an effort to monetize certain of its assets, including
selling a portion or all of certain in vestment  and/or certain of its operating
entities.  These may include minority interest in network affiliated  television
stations and certain  telephone  operations where growth  opportunities  are not
readily apparent. There is no assurance that all or any part of this program can
be  effectuated on acceptable  terms.  In March 2002, the Company sold its 20.8%
interest in the New Mexico cellular property, RSA 1 (North), to Verizon Wireless
for $5.6 million and repaid certain outstanding indebtedness to Verizon.

Critical Accounting Policies and Estimates

General

Interactive's  discussion and analysis of its financial condition and results of
operations are based upon its consolidated financial statements, which have been
prepared in accordance  with  accounting  principles  generally  accepted in the
United  States.   The  preparation  of  these  financial   statements   requires
Interactive to make estimates and judgments that affect the reported  amounts of
assets, liabilities, revenues and expenses, and related disclosure of contingent
assets  and  liabilities.   On  an  ongoing  basis,  Interactive  evaluates  its
estimates, including those related to revenue recognition, carrying value of its
investments  in the spectrum  entities and  long-lived  assets,  purchase  price
allocations,  and contingencies and litigation.  Interactive bases its estimates
on historical  experience and on various other  assumptions that are believed to
be reasonable under the  circumstances,  the results of which form the basis for
making  judgments about the carrying  values of assets and liabilities  that are
not readily  apparent from other  sources.  Actual results may differ from these
estimates under different assumptions or conditions.

Interactive  believes the following critical accounting policies affect its more
significant  judgments and estimates used in the preparation of its consolidated
financial statements.

Revenue Recognition

The  principal  business  of  Interactive's  telephone  companies  is to provide
telecommunications  services.  These  services fall into four major  categories:
local  network,   network   access,   long  distance  and  other   non-regulated
telecommunications  services. Toll service to areas outside franchised telephone
service territory is furnished  through switched and special access  connections
with intrastate and interstate long distance networks.

Local  service  revenues are derived from  providing  local  telephone  exchange
services.  Local  service  revenues are based on rates filed with various  state
telephone regulatory bodies.

Revenues from long distance network services are derived from providing  certain
long distance  services to the Company's local exchange  customers and are based
on rates filed with various state regulatory bodies.

Revenue from intrastate  access is generally  billed monthly in arrears based on
intrastate access rates filed with various state regulatory bodies.  Interactive
recognizes  revenue from  intrastate  access service based on an estimate of the
amounts  billed to  interexchange  carriers in the subsequent  month.  Estimated
revenues are adjusted monthly as actual revenues become known.

Revenue from  interstate  access is derived from  settlements  with the National
Exchange Carrier Association ("NECA"). NECA was created by the FCC to administer
interstate  access rates and revenue  pooling on behalf of small local  exchange
carriers  who  elect  to  participate  in  a  pooling  environment.   Interstate
settlements are determined based on the various  subsidiaries' cost of providing
interstate  telecommunications service. Interactive recognizes interstate access
revenue  based on an  estimate of the current  year cost of  providing  service.
Estimated  revenue is adjusted to actual upon the  completion of cost studies in
the subsequent period.
                                       20
<PAGE>

Other ancillary revenues derived from the provision of directory advertising and
billing  and  collection  services  are  billed  monthly  based on  rates  under
contract.

Purchase Price Allocation

Interactive's business development strategy is to expand its existing operations
through internal growth and acquisition. From 1989 through 2001, the Company has
acquired twelve  telephone  companies.  Significant  judgments and estimates are
required to allocate the  purchase  price of  acquisitions  to the fair value of
tangible  assets  acquired and  identifiable  intangible  assets and liabilities
assumed.  Any excess  purchase  price over the above fair values is allocated to
goodwill.  Additional  judgments  and  estimates  are  required to  determine if
identified  intangible  assets have finite or indefinite lives and the period of
their lives.

Depreciation and Amortization

The  calculation  of  depreciation  and  amortization  expense  is  based on the
estimated economic useful lives of the underlying property,  plant and equipment
and intangible  assets.  Although  Interactive  believes it is unlikely that any
significant  changes to the useful  lives of its tangible or  intangible  assets
will occur in the near term, rapid changes in technology,  the discontinuance of
accounting under SFAS No. 71 by the Company's wireline subsidiaries,  or changes
in market  conditions  could result in revisions  to such  estimates  that could
materially  affect the carrying  value of these assets and the Company's  future
consolidated operating results.

Item 3. Quantitative and Qualitative Disclosure About Market Risk

The Company is exposed to market risk  relating to changes in the general  level
of U.S. interest rates. Changes in interest rates affect the amounts of interest
earned on the Company's  cash and cash  equivalents  ($35.9 million at September
30, 2002 and $31.2 million at December 31, 2001).

The Company generally  finances the debt portion of the acquisition of long-term
assets with fixed rate,  long-term  debt.  The Company  generally  maintains the
majority  of its debt as fixed  rate in nature  either by  borrowing  on a fixed
long-term  basis  or, on a  limited  basis,  entering  into  interest  rate swap
agreements.  The  Company  does not use  derivative  financial  instruments  for
trading or speculative  purposes.  Management  does not foresee any  significant
changes in the strategies  used to manage interest rate risk in the near future,
although the strategies may be reevaluated as market conditions dictate.

At September  30, 2002,  approximately  $63.7  million,  or 32% of the Company's
long-term debt and notes payable bears interest at variable rates.  Accordingly,
the Company's earnings and cash flows are affected by changes in interest rates.
Assuming the current level of  borrowings  for variable rate debt and assuming a
one  percentage  point  change in the 2002  average  interest  rate under  these
borrowings,  it is estimated that the Company's 2002 nine-month interest expense
would have changed by less than $0.4 million.  In the event of an adverse change
in interest rates,  management would likely take actions to further mitigate its
exposure. However, due to the uncertainty of the actions that would be taken and
their  possible  effects,  the analysis  assumes no such actions.  Further,  the
analysis  does not  consider  the  effects of the change in the level of overall
economic activity that could exist in such an environment.
                                       21
<PAGE>

Item 4. Controls and Procedures

(a)  Evaluation of disclosure controls and procedures.

     Our chief executive  officer and chief financial officer have evaluated the
     effectiveness  of the  Company's  disclosure  controls and  procedures  (as
     defined in Rules 13a-14(c) and 15d-14(c) of the Securities  Exchange Act of
     1934 (the  "Act")) as of a date  within 90 days of the filing  date of this
     quarterly  report  (Evaluation  Date).  They have concluded that, as of the
     Evaluation  Date, the Company's  disclosure  controls and  procedures  were
     adequate and effective to ensure that information  required to be disclosed
     by the  Company in the  reports  that if files or submits  under the Act is
     recorded,  processed,  summarized  and  reported,  within the time  periods
     specified in the rules and forms of the Securities and Exchange Commission.

(b)  Changes in internal controls.

     There were no significant  changes in the Company's internal controls or in
     other factors that could significantly  affect these controls subsequent to
     the  Evaluation  Date,  nor were  there  any  significant  deficiencies  or
     material weaknesses in these controls requiring corrective actions.
                                       22
<PAGE>


                           FORWARD LOOKING INFORMATION

Included in this Management  Discussion and Analysis of Financial  Condition and
Results  of  Operations  are  certain  forward   looking   financial  and  other
information,  including  without  limitation,  the Company's  effort to monetize
certain  assets,  Liquidity and Capital  Resources and Market Risk. It should be
recognized  that such  information are estimates or forecasts based upon various
assumptions, including the matters, risks, and cautionary statements referred to
therein, as well as meeting the Registrant's  internal  performance  assumptions
regarding  expected  operating  performance and the expected  performance of the
economy  and  financial  markets as it  impacts  Registrant's  businesses.  As a
result,  such information is subject to  uncertainties,  risks and inaccuracies,
which could be material.
                                       23
<PAGE>

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Taylor  Litigation.  Interactive and several other parties,  including our Chief
Executive  Officer,  and Fortunet  Communications,  L.P., which was Sunshine PCS
Corporation's  predecessor-in-interest,  have  been  named  as  defendants  in a
lawsuit  brought under the so-called  "qui tam"  provisions of the federal False
Claims Act in the United States District Court for the District of Columbia. The
complaint  was filed  under seal with the court on  February  14,  2001.  At the
initiative  of one of the  defendants,  the seal was lifted on January 11, 2002.
Under the False Claims Act, a private plaintiff,  termed a "relator," may file a
civil action on the U.S. government's behalf against another party for violation
of the  statute.  In return,  the relator  receives a statutory  bounty from the
government's litigation proceeds if he is successful.

The relator in this lawsuit is R.C.  Taylor III, an individual  who, to the best
of  our  knowledge,  has no  relationship  to any  of  the  Lynch  entities  and
affiliates that have been named parties in this  litigation.  Indeed at the time
of his filings,  and to the best of our  knowledge,  Mr.  Taylor was a lawyer at
Gardner,  Carton &  Douglas.  Thereafter,  we  believe  he was a  lawyer  with a
Washington, D.C., law firm. We do not know his current status. We issued a press
release dealing with this litigation on January 16, 2002.

Interactive strongly believes that this lawsuit is completely without merit, and
intends to defend  the suit  vigorously.  The U.S.  Department  of  Justice  has
notified the court that it has declined to intervene in the case.  Nevertheless,
we cannot predict the ultimate outcome of the litigation, nor can we predict the
effect  that the  lawsuit or its  outcome  will have on our  business or plan of
operation.

Interactive  was  formally  served  with  the  complaint  on July 10,  2002.  On
September  19,  2002,  Interactive  filed two  motions  with the  United  States
District Court for the District of Columbia: a motion to dismiss the lawsuit and
a motion to  transfer  the  action to the  Southern  District  of New York.  The
relator has until November 25, 2002, to respond to Interactive's motions.

Item 6. Exhibits and Reports on Form 8-K

     (a)  Exhibit  99.1 - Chief  Executive  Officer  Section 906  Certification.
          Exhibit 99.2 - Chief Financial Officer Section 906 Certification.

     (b)  None.

                                       24
<PAGE>


                                    SIGNATURE


     Pursuant to the  requirements  of the  Securities and Exchange Act of 1934,
the  Registrant  has duly  caused  this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                     LYNCH INTERACTIVE CORPORATION
                                     (Registrant)

                                     By: /s/Robert E. Dolan
                                         -------------------
                                         Robert E. Dolan
                                         Chief Financial Officer

November 14, 2002




                                       25
<PAGE>

                                 CERTIFICATIONS

I, Mario J. Gabelli,  the Chief  Executive  Officer of the  Registrant,  certify
that:

     1. I have reviewed this quarterly report on Form 10-Q of Lynch  Interactive
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  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.

                                         /s/ Mario J. Gabelli
                                         --------------------
                                         Mario J. Gabelli
                                         Chief Executive Officer of
                                         Lynch Interactive Corporation

November 14, 2002

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     I, Robert E. Dolan, the Chief Financial Officer of the Registrant,  certify
that:

     1. I have reviewed this quarterly report on Form 10-Q of Lynch  Interactive
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  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.

                                         /s/ Robert E. Dolan
                                         -------------------
                                        Robert E. Dolan
                                        Chief Financial Officer of
                                        Lynch Interactive Corporation
November 14, 2002

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