<DOCUMENT>
<TYPE>8-K/A
<SEQUENCE>1
<FILENAME>verdisys8k092603.txt
<DESCRIPTION>VERDISYS 8K/A, 09.24.03
<TEXT>








                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 8-K
                                  Amendment #1

                             CURRENT REPORT PURSUANT
                          TO SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934


               Date of Report:                     September 24, 2003

               Date of Earliest Event Reported:    July 18, 2003


                                 Verdisys, Inc.
             ------------------------------------------------------
             (Exact Name of Registrant as Specified in its Charter)


      California                      333-64122                  22-3755993
----------------------         ------------------------      -------------------
(State of Organization)        (Commission File Number)       (I.R.S. Employer
                                                             Identification No.)


                      10600 N. De Anza Boulevard, Suite 250
                           Cupertino, California 95014
                    ----------------------------------------
                    (Address of Principal Executive Offices)

                                 (858) 618-1085
                          ----------------------------
                          Registrants Telephone Number


                         Reconstruction Data Group, Inc.
                          11650 Iberia Place, Suite 201
                           San Diego, California 92128
                                 (858) 618-1085
                     --------------------------------------
                     (Former Name or Address of Registrant)
















                                   Page 1 of 4
<PAGE>

Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K


Item 1. Changes in Control of Registrant
----------------------------------------

On April 24, 2003  Reconstruction  Data Group, Inc. (the "Company") entered into
an  Agreement  and Plan of Merger  (the  "Agreement")  with  Verdisys,  Inc.  (a
California  Corporation)  ("Verdisys  ")  to  acquire  all  of  the  issued  and
outstanding  common stock of Verdisys,  subject to the  completion of mutual due
diligence  examinations and the completion of the acquisition of Verdisys,  Inc.
by Reconstruction Data Group, Inc.


The closing of the Agreement occurred on July 18, 2003, subject to processing of
the  appropriate  state  filings  required  to  complete  the  transaction.   In
connection with the Agreement, the Company will issue an aggregate of 25,202,539
shares of its  restricted  common  stock,  par value  $0.001 per  share,  to the
shareholders  of  Verdisys  in exchange  for the  25,202,539  shares of Verdisys
common stock owned by approximately 350 shareholders.


In connection with Closing of the Agreement, the Company is changing its name to
"Verdisys,  Inc." and is changing  the OTCBB symbol under which our common stock
trades on the  Over-The-Counter  Bulleting  Board.  The  current  directors  and
officers shall resign their  positions as directors and officers of the Company.
As a result, the Company will have experienced a change in control.


In  connection  with  reorganization,   at  or  prior  to  Closing  (i)  certain
shareholders of the Company have agreed to have canceled an aggregate  2,151,500
shares of  common  stock,  representing  approximately  58.92% of our  3,651,500
shares of common stock currently outstanding, leaving 1,500,000 shares of common
stock  outstanding,  and (ii) the Company will issue  25,202,539  newly  issued,
restricted  shares  of  common  stock  in  exchange  for all of the  issued  and
outstanding shares of Verdisys.


Following  the  Closing  of  the  transaction  Verdisys  Shareholders  will  own
approximately 95.6% of the issued and outstanding shares of the Company.


Following  the  share  exchange,  Reconstruction  Data  Group,  Inc.  will  have
26,702,539 common shares issued and outstanding. The following are the Officers,
Directors and the shareholders  that will  beneficially own five percent or more
of Reconstruction Data Group, Inc.


<TABLE>
<CAPTION>
                                                             Number of    % of Total
Name                                     Class of Shares   Shares Held   Outstanding
-----------------------------------      ---------------   -----------   -----------

<S>                                        <C>              <C>             <C>
Dan Williams, CEO/President                Common Stock       591,667        2.22
25045 I-45 North #525
The Woodlands, TX 77380

David Mauz, COO                            Common Stock       394,222        1.48
25045 I-45 N. #525
The Woodlands, TX 77380

Andrew Wilson, CFO                         Common Stock        25,208        0.09
201 Tipperary Lane
Alameda, CA 94502

Mark Crone, Secretary/ General Counsel     Common Stock             0         0.0
28 Woodland Drive
Granby, Connecticut 06035

Paul Schroeder, Controller                 Common Stock        65,000        0.24
10600 N. De Anza Blvd. #250
Cupertino, CA 95014

Ron Robinson, Chairman/Director            Common Stock       300,000        1.11
10600 N. De Anza Blvd. #250
Cupertino, CA 95014

John Block, Director                       Common Stock        90,000        0.34
655 15th NW Suite 700
Washington, DC 20005

Joe Penbera, Director                      Common Stock     1,163,952        4.37
4921 N. Van Ness
Fresno, CA 93704

Fred Ruiz, Director                        Common Stock       130,000        0.49
P.O. Box 37
Dinuba, CA 93618

                                   Page 2 of 4
<PAGE>

Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K


                                                             Number of    % of Total
<CAPTION>
Name                                     Class of Shares   Shares Held   Outstanding
-----------------------------------      ---------------   -----------   -----------

<S>                                        <C>                <C>            <C>
James Woodward III, Director               Common Stock       122,000        0.46
2909 W. Fallbrook Ave.
Fresno, CA 93711

Eric McAfee, Director                      Common Stock       125,000        0.47
10600 N. De Anza Blvd. #250
Cupertino, CA 95014

Berg McAfee Companies                      Common Stock     8,394,271       31.55
(an entity controlled by Eric McAfee
and Clyde Berg)
10600 N. De Anza Blvd. #250
Cupertino, CA 95014

Clyde Berg                                 Common Stock       375,000        1.41
10600 N. De Anza Blvd. #250
Cupertino, CA 95014
</TABLE>

Number  of shares  beneficially  owned by  officers  and  directors  as a group:
11,401,320 representing 42.86% of the issued and outstanding common shares.

Mr.  Scott Baker will resign as the  President  and will resign as a director of
the Company.  Executive  officers and directors of Verdisys will be appointed to
fill  vacancies  created by the  resignations.  Dan  Williams  will be our Chief
Executive  Officer and President of the Company and the  remaining  appointments
are being made as indicated in the above table of ownership.

Pursuant to the Agreement and Plan of Merger,  vested options to purchase common
stock in Verdisys,  Inc. at $0.10 per share will be  converted to  corresponding
options to purchase Reconstruction Data group common shares at equivalent terms.
These  options if converted  would  result in the  issuance of 1,764,082  common
shares.  Some of  these  options  are  held by the  officers  and  directors  of
Verdisys, Inc.

The Company knows of no other arrangement or events, the happening of which will
result in a change in control.


Item 2. Acquisition or Disposition of Assets.
---------------------------------------------

Agreement and Plan of Merger with Verdisys, Inc.
------------------------------------------------

On April 24, 2003,  Reconstruction Data Group, Inc. (the "Company") entered into
an Agreement and Plan of Merger (the "Agreement") with Verdisys, Inc. ("Verdisys
") to acquire  all of the  issued  and  outstanding  common  stock of  Verdisys,
discussed previously in item 1 of this current report.


Reconstruction Data Group, Inc. will deliver to the Verdisys  Shareholders stock
certificates  in  accordance  with  Agreement  totaling   25,202,539  shares  of
Reconstruction  Data Group,  Inc. Common Stock, in exchange for 100% of Verdisys
issued and outstanding common stock.


The Board  considered,  including but not limited to the following  factors when
determining the amount of consideration for this Agreement.  The historic losses
of the company, lack of current net profits,  limited liquidity of the company's
Common Stock and the current lack of available capital resources were considered
when making its  valuation of the  compensation  related to the  Agreement.  The
Board further  considered  the current  level  development  of Verdisys,  Inc.'s
existing operations, their potential to expand operations, the experience of its
management  team,  and  believes  this  agreement  will  be  beneficial  to  the
shareholders.

Verdisys, Inc. and its management had no prior relationship with the registrant,
any affiliates of the registrant,  any director or officer of the registrant, or
any associate of any such director or officer.  Reconstruction  Data Group, Inc.
sought potential  opportunities to expand  operations and initiated contact with
Verdisys, Inc.

In connection with the Agreement and Plan of Merger,  all assets and liabilities
of the ARC network  are  intended  to be  acquired  by Scott  Baker,  the former
president in  consideration  for the  cancellation of 1,485,000 shares of common
stock  currently  held by Mr. Baker.  The  development  of the Arc Network as an
industry  forum for Accident  Reconstruction  is shifting  potentially  toward a
non-profit type entity.  The ARC Network  operations have benefited  little from
the public entity and have been burdened by the expense.  This is disposition of
assets is subject to applicable approvals.

                                   Page 3 of 4
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K


Item 7. Financial Statements and Exhibits
-----------------------------------------

Financial Statements
--------------------

Verdisys,   Inc.  (formerly,   Reconstruction  Data  Group,  Inc.)  provides  by
attachment to this current report the required financial statements.

Exhibits
--------

Verdisys,  Inc.  (formerly,  Reconstruction  Data Group,  Inc.)  incorporates by
reference  Current Report on Form 8-K as filed July 18, 2003 with the Securities
and  Exchange  Commission,  including  Exhibit  (2)  -  Agreement  and  Plan  of
Reorganization  - Dated April 24, 2003,  as amended June 30, 2003,  attached and
incorporated into such report.









                                   SIGNATURES
                                   ----------


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

                                                    VERDISYS, INC.
                                            ------------------------------


Date: September 24, 2003            By: \s\ Dan Williams, President
                                        ----------------------------------------
                                          Dan Williams, President
                                          Principal Executive Officer

Date: September 24, 2003            By: \s\ David Mauz, COO
                                        ----------------------------------------
                                          David Mauz, Chief Operations Officer

Date: September 24, 2003            By: \s\ Andrew Wilson, CFO
                                        ----------------------------------------
                                          Andrew Wilson, Chief Financial Officer
                                          Principal Accounting Officer




















                                   Page 4 of 4
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


                                 Verdisys, Inc.
                              Financial Statements

                                Table of Contents


                                                                  Page Number
                                                                  -----------

Section 1

   Balance Sheet for the period ending June 30, 2003                   2

   Statements of Operations                                            3
     Three and Six Months Ended June 30, 2003 and 2002

   Statements of Cash Flow                                             4
     Six Months Ended June 30, 2003 and 2002

   Notes to Financial Statements                                       5


Section 2

   Independent Auditors' Report                                        7

   Balance Sheet as of December 31, 2002                               8

   Statements of Operations                                            9
     Years Ended December 31, 2002 and 2001

   Statements of Stockholders' Deficit                                10
     Years Ended December 31, 2001 and 2002

   Statements of Cash Flow                                            12
     Years Ended December 31, 2002 and 2001

   Notes to Financial Statements                                      13

Section 3

   Pro Forma Consolidated Condensed Balance Sheet                     20

   Notes to Pro Forma Consolidated Condensed Balance Sheet            21



















                                     Page 1
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


                                 VERDISYS, INC.
                                  BALANCE SHEET
                                  June 30, 2003
                                   (Unaudited)

         ASSETS

Current Assets
   Cash                                                           $      97,542
   Accounts receivable, net                                             309,417
   Other current assets                                                  34,551
                                                                  --------------

         Total Current Assets                                           441,510
                                                                  --------------


Property and equipment, net of accumulated depreciation of $42,713        2,874
License, net of accumulated amortization of $45,834                   2,704,166
                                                                  --------------

         Total Assets                                             $   3,148,550
                                                                  ==============


         LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities
   Accounts payable                                               $     440,116
   Accrued expenses                                                     486,237
   Deferred revenue                                                      52,873
   Notes payable to stockholders                                        324,106
   Note payable on license                                            2,553,114
                                                                  --------------

         Total Current Liabilities                                    3,856,446
                                                                  ==============

Long Term Liabilities
   Deferred revenue, less current portion                               187,898
                                                                  --------------

         Total Liabilities                                            4,044,344
                                                                  --------------


Commitments & Contingencies

Stockholders' Deficit
   Convertible preferred stock, no par value,
    40,000,000 shares authorized
         Series A, 2,000,000 shares allocated, none outstanding
         Series B, none issued and outstanding
   Common stock, no par value, 60,000,000 shares authorized,
    25,202,539 shares issued and outstanding                          8,678,475
   Additional paid in capital                                         3,006,988
   Accumulated deficit                                              (12,581,257)
                                                                  --------------

         Total Stockholders' Deficit                                   (895,794)
                                                                  --------------

                  Total Liabilities and Stockholders' Deficit     $   3,148,550
                                                                  ==============



                                     Page 2
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


<TABLE>
<CAPTION>
                                 VERDISYS, INC.
                            STATEMENTS OF OPERATIONS
                Three and Six Months Ended June 30, 2003 and 2002
                                   (Unaudited)


                                                  Three Months                             Six Months
                                                 Ended June 30,                          Ended June 30,
                                             2003               2002                 2003               2002
                                       ----------------   ----------------     ----------------   ----------------

<S>                                    <C>                <C>                  <C>                <C>
Revenue                                $      487,843     $      127,878       $      624,291     $      206,823

Cost of services provided                     281,500            109,697              390,064            197,454
Selling, general & administrative             957,595            526,735            1,187,693            863,475
Depreciation & amortization                    46,274              2,176               46,714              4,890
Impairment                                  1,000,000                               1,000,000
Debt forgiveness income                      (460,235)                               (460,235)
                                       ----------------   ----------------     ----------------   ----------------

         Total operating expenses           1,825,134            638,608            2,164,236          1,065,819

         Operating loss                    (1,337,291)          (510,730)          (1,539,945)          (858,996)
                                       ----------------   ----------------     ----------------   ----------------

Other expense
   Interest expense                           (60,197)           (41,007)             (96,838)           (62,878)
                                       ----------------   ----------------     ----------------   ----------------

         NET LOSS                      $   (1,397,488)    $     (551,737)      $   (1,636,783)    $     (921,874)
                                       ================   ================     ================   ================


Basic and diluted net loss per share   $         (.08)    $         (.04)      $         (.10)    $         (.07)

Weighted average shares outstanding        18,376,272         13,553,139           16,199,706         13,553,139
</TABLE>


























                                     Page 3
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


<TABLE>
<CAPTION>
                                 VERDISYS, INC.
                             STATEMENTS OF CASH FLOW
                     Six Months Ended June 30, 2003 and 2002
                                   (Unaudited)

                                                              2003                2002
                                                        ----------------    ----------------

<S>                                                     <C>                 <C>
Cash Flows from Operating Activities
   Net loss                                             $   (1,636,783)     $     (921,874)
  Adjustments to reconcile net loss to net cash
   used in operating activities:
    Stock issued for services                                  315,929
    Issuance of options and warrants for services              545,551             315,127
    Depreciation and amortization                               46,714               4,890
    Impairment expense                                       1,000,000
    Debt forgiveness income                                   (460,235)
    Changes in:
     Accounts receivable                                      (299,015)           (125,208)
     Other current assets                                        8,070
     Accounts payable                                           (2,323)             83,590
     Accrued expenses                                         (112,595)            156,316
     Deferred revenue                                          104,224             112,875
                                                        ----------------    ----------------

  Net Cash Used In Operating Activities                       (490,463)           (374,284)
                                                        ----------------    ----------------

Cash Flows from Investing Activities
  Purchase of property and equipment                                                (5,286)
  Cash payments for license                                   (100,000)
                                                        ----------------    ----------------

  Net Cash Used Investing Activities                          (100,000)             (5,286)
                                                        ----------------    ----------------

Cash Flows from Financing Activities
  Proceeds from sales of common stock                          764,150
  Proceeds from exercise of warrants                            56,500
  Payments on notes payable to stockholders                    (35,894)
  Payments on note payable on license                          (96,886)
  Proceeds from sales of preferred stock                                           380,000
                                                        ----------------    ----------------

  Net Cash Provided by Financing Activities                    687,870             380,000
                                                        ----------------    ----------------

Net change in cash                                              97,407                 430
Cash at beginning of period                                        135               3,397
                                                        ----------------    ----------------

Cash at end of period                                   $       97,542      $        3,827
                                                        ================    ================

Non-cash transactions:
  Purchase of license with note payable                 $    2,650,000
  Conversion of notes payable and accrued interest to
    investors to common stock                                1,506,190
  Conversion of Series B preferred stock to common             705,000
  Warrant exercised with accounts payable                       95,000
  Stock issued for accounts payable                             16,666
  Warrant exercised with notes payable to investors             20,000
</TABLE>






                                     Page 4
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


                                 VERDISYS, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)


NOTE 1 - BASIS OF PRESENTATION

The  accompanying  unaudited  interim  financial  statements  of Verdisys,  Inc.
("Verdisys")  have  been  prepared  in  accordance  with  accounting  principles
generally  accepted  in the  United  States  of  America  and the  rules  of the
Securities and Exchange  Commission  ("SEC"),  and should be read in conjunction
with the audited  financial  statements and notes thereto contained in Verdisys'
Annual Report filed with the SEC on Form 8-K. In the opinion of management,  all
adjustments,  consisting of normal recurring  adjustments,  necessary for a fair
presentation of financial position and the results of operations for the interim
periods presented have been reflected herein.  The results of operations for the
interim periods are not necessarily indicative of the results to be expected for
the full year.  Notes to the  financial  statements  which  would  substantially
duplicate the disclosure  contained in the audited financial statements for 2002
as reported in the 8-K have been omitted.


NOTE 2 - STOCK OPTIONS AND WARRANTS

Stock  options  and  warrants.   Verdisys  accounts  for  non-cash   stock-based
compensation  issued to  non-employees in accordance with the provisions of SFAS
No. 123 and EITF No. 96-18, Accounting for Equity Investments That Are Issued to
Non-Employees  for Acquiring,  or in Conjunction with Selling Goods or Services.
Common stock issued to non-employees  and consultants is based upon the value of
the  services  received  or the quoted  market  price,  whichever  value is more
readily determinable. Verdisys accounts for stock options and warrants issued to
employees  under  the  intrinsic  value  method.  Under  this  method,  Verdisys
recognizes no  compensation  expense for stock options or warrants  granted when
the number of underlying shares is known and the exercise price of the option or
warrant is greater  than or equal to the fair  market  value of the stock on the
date of grant.  The following  table  illustrates the effect on net loss and net
loss per  share if  Verdisys  had  applied  the fair  value  provisions  of FASB
Statement No. 123,  Accounting  for  Stock-Based  Compensation,  to  stock-based
employee compensation.


In April 2003,  Verdisys  issued  1,280,000 10 year $.10  options to  employees.
30,000  options vest monthly over three months,  750,000  options vest quarterly
over three  years,  300,000  options  vest  quarterly  over one year and 200,000
options vest  quarterly  over two years.  The  intrinsic  value of these options
totals $193,250.


In April 2003,  Verdisys  issued  100,000 $.10  warrants  that expire in January
2007.

During the summer of 2003, Verdisys  negotiated  settlements with 9 vendors plus
the two original  founders for various  debts  carried on the books.  One of the
founders was issued 150,000  warrants  exercisable at $.10 and valued at $.40 or
$60,000.

<TABLE>
<CAPTION>
                                                         2003             2002
                                                    --------------   --------------

<S>                                                 <C>              <C>
     Net loss as reported                           $  (1,636,783)   $    (921,874)
     Less: stock based compensation determined
         under fair valued-based method                         0                0
                                                    --------------   --------------

         Pro forma net loss                         $  (1,636,783)   $    (921,874)
                                                    ==============   ==============

     Basic and diluted net loss per common share:
         As reported                                $        (.10)   $        (.07)
         Pro forma                                           (.10)            (.07)
</TABLE>

The weighted  average fair value of the stock  options  granted  during 2003 and
2002  was $.50  and  $.50,  respectively.  Variables  used in the  Black-Scholes
option-pricing  model include (1) 5.0%  risk-free  interest  rate,  (2) expected
option life is the actual remaining life of the options as of each year end, (3)
expected volatility is zero, and (4) zero expected dividends.


                                     Page 5
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


                                 VERDISYS, INC.
                          NOTES TO FINANCIAL STATEMENTS
                                   (Unaudited)


NOTE 3 - LATERAL DRILLING LICENSE

In April 2003,  an  individual  licensed  his lateral  drilling  technology  and
equipment to Verdisys. Verdisys is required to pay $2,750,000 plus 10 percent of
related  gross  revenue.  $100,000  was due upon  signing and a note payable for
$2,650,000 plus 8 percent is to be paid out from May 2003 through March 2004 for
a total payout of $2,970,000.


NOTE 4 - DEBT FORGIVENESS INCOME

During the summer of 2003, Verdisys  negotiated  settlements with 9 vendors plus
the two original  founders for various  debts carried on the books at $1,096,501
for $71,600 cash, 33,333 shares of stock (valued at $.50 or $16,666) and 150,000
warrants exercisable at $.10 and valued at $.40 or $60,000. $460,235 is shown in
2003 as debt forgiveness  income for the vendors and the $548,000 related to the
original founders is shown in 2003 as a contribution to capital.


NOTE 5 - SOFTWARE IMPAIRMENT

Verdisys  reviews  the  carrying  value of its  long-lived  assets  annually  or
whenever  events  or  changes  in  circumstances  indicate  that the  historical
cost-carrying value of an asset may no longer be appropriate.  Verdisys assesses
recoverability  of the carrying  value of the asset by estimating the future net
cash flows expected to result from the asset, including eventual disposition. If
the  future  net cash flows are less than the  carrying  value of the asset,  an
impairment loss is recorded equal to the difference between the asset's carrying
value and fair value. In April 2003,  Verdisys issued 2,000,000 shares of common
stock for software. The shares were valued at $1,000,000.  The software has been
determined to not be useful and was fully impaired as of June 30, 2003.


























                                     Page 6
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment




                          INDEPENDENT AUDITORS' REPORT


To the Board of Directors
  Verdisys, Inc.
  Houston, Texas

We have audited the accompanying balance sheet of Verdisys,  Inc. as of December
31, 2002 and the related  statements of  operations,  stockholders'  deficit and
cash flows for each of the two years then ended. These financial  statements are
the responsibility of Verdisys' management.  Our responsibility is to express an
opinion on these financial statements based on our audits.

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

In our opinion,  the financial  statements  referred to above present fairly, in
all material respects,  the financial position of Verdisys,  Inc. as of December
31,  2002 and the results of its  operations  and cash flows for each of the two
years then ended in conformity with accounting  principles generally accepted in
the United States of America.

MALONE & BAILEY, PLLC
www.malone-bailey.com
Houston, Texas

May 27, 2003,
 except Notes 11 and 12,
 for which the date is
 September 18, 2003




















                                     Page 7
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


                                 VERDISYS, INC.
                                  BALANCE SHEET
                                December 31, 2002


         ASSETS

Current Assets
   Cash                                                           $         135
   Accounts receivable, net                                              10,402
   Employee advances                                                     42,620
                                                                  --------------

         Total Current Assets                                            53,157
                                                                  --------------

Property and equipment, net of accumulated depreciation of $41,833        3,755
                                                                  --------------

         Total Assets                                             $      56,912
                                                                  ==============


         LIABILITIES AND STOCKHOLDERS' DEFICIT

Current Liabilities
   Accounts payable                                               $   1,562,339
   Accrued expenses                                                     905,461
   Deferred revenue                                                      56,180
   Notes payable to stockholders                                      1,579,562
                                                                  --------------

         Total Current Liabilities                                    4,103,542

Long Term Liabilities
   Deferred revenue, less current portion                                80,367
                                                                  --------------

         Total Liabilities                                            4,183,909
                                                                  --------------

Commitments & Contingencies

Stockholders' Deficit
   Convertible preferred stock, no par value,
     40,000,000 shares authorized
       Series A, 2,000,000 shares allocated, none outstanding
       Series B, 1,410,000 shares issued and outstanding                705,000
   Common stock, no par value, 60,000,000 shares authorized
     13,553,139 shares issued and outstanding                         4,199,040
  Additional paid in capital                                          1,913,437
  Accumulated deficit                                               (10,944,474)
                                                                  --------------

         Total Stockholders' Deficit                                 (4,126,997)
                                                                  --------------

         Total Liabilities and Stockholders' Deficit              $      56,912
                                                                  ==============


               See accompanying summary of accounting policies and
                         notes to financial statements.

                                     Page 8
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


<TABLE>
<CAPTION>
                                 VERDISYS, INC.
                            STATEMENTS OF OPERATIONS
                     Years Ended December 31, 2002 and 2001


                                                 2002                2001
                                           ----------------    ----------------

<S>                                        <C>                 <C>
Revenue                                    $      287,190      $      162,406


Cost of services provided                         276,454             157,984
Selling, general & administrative               3,002,470           2,145,651
Bad debts                                           9,368              12,984
Depreciation                                       11,380              13,434
                                           ----------------    ----------------

         Total operating expenses               3,299,672           2,330,053
                                           ----------------    ----------------

         Operating loss                        (3,012,482)         (2,167,647)
                                           ----------------    ----------------

Other income and (expense)
   Interest income                                     21               4,350
   Interest expense                              (116,321)           (333,823)
                                           ----------------    ----------------

         NET LOSS                          $   (3,128,782)     $   (2,497,120)
                                           ================    ================



Basic and diluted net loss per share       $         (.23)     $         (.19)

Weighted average shares outstanding            13,553,139          13,108,389
</TABLE>




















               See accompanying summary of accounting policies and
                         notes to financial statements.

                                     Page 9
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


<TABLE>
<CAPTION>
                                 VERDISYS, INC.
                       STATEMENT OF STOCKHOLDERS' DEFICIT
                     Years Ended December 31, 2001 and 2002


                                                    Preferred Series A                  Preferred Series B
                                                  Shares           Amount             Shares           Amount
                                              --------------   --------------     --------------   --------------

<S>                                                <C>         <C>                    <C>          <C>
Balances, December 31, 2000                         148,761    $      72,374

Shares issued for cash

Series B preferred shares issued for cash                                               650,000    $     325,000

Conversion of Series A to common stock             (148,761)         (72,374)

Options issued for services

Warrants issued for interest

Net loss
                                              --------------   --------------     --------------   --------------

Balances, December 31, 2001                               0                0            650,000          325,000

Series B preferred shares issued for cash                                               760,000          380,000

Options issued for services

Warrants issued for services

Warrants issued for interest

Net loss
                                              --------------   --------------     --------------   --------------

Balances, December 31, 2002                               0    $           0          1,410,000    $     705,000
                                              ==============   ==============     ==============   ==============
</TABLE>















               See accompanying summary of accounting policies and
                         notes to financial statements.

                                     Page 10
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


<TABLE>
<CAPTION>
                                 VERDISYS, INC.
                       STATEMENT OF STOCKHOLDERS' DEFICIT
                     Years Ended December 31, 2001 and 2002


                                                       Common Stock                 Retained
                                                  Shares           Amount           Deficit            Totals
                                              --------------   --------------    --------------    --------------

<S>                                              <C>           <C>               <C>               <C>
Balances, December 31, 2000                      12,663,638    $   4,596,521     $  (5,318,572)    $    (649,677)

Shares issued for cash                              740,740          100,000                             100,000

Series B preferred shares issued for cash                                                                325,000

Conversion of Series A to common stock              148,761           72,374                                   0

Options issued for services                                          341,324                             341,324

Warrants issued for interest                                         204,167                             204,167

Net loss                                                                            (2,497,120)       (2,497,120)
                                              --------------   --------------    --------------    --------------

Balances, December 31, 2001                      13,553,139        5,314,386        (7,815,692)       (2,176,306)

Series B preferred shares issued for cash                                                                380,000

Options issued for services                                          401,291                             401,291

Warrants issued for services                                         392,000                             392,000

Warrants issued for interest                                           4,800                               4,800

Net loss                                                                            (3,128,782)       (3,128,782)
                                              --------------   --------------    --------------    --------------

Balances, December 31, 2002                      13,553,139        6,112,477     $ (10,944,474)    $  (4,126,997)
                                              ==============   ==============    ==============    ==============
Less common stock                                                  4,199,040
                                                               --------------

Additional paid in capital                                     $   1,913,437
                                                               ==============
</TABLE>











               See accompanying summary of accounting policies and
                         notes to financial statements.

                                     Page 11
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


<TABLE>
<CAPTION>
                                 VERDISYS, INC.
                             STATEMENTS OF CASH FLOW
                     Years Ended December 31, 2002 and 2001


                                                                      2002                2001
                                                                ----------------    ----------------
<S>                                                             <C>                 <C>
Cash Flows from Operating Activities
   Net loss                                                     $   (3,128,782)     $   (2,497,120)
     Adjustments to reconcile net loss to net cash used in
       operating activities:
     Issuance of options and warrants for services                     793,291             341,324
     Issuance of stock options for interest expense                      4,800             204,167
     Depreciation                                                       11,380              13,434
     Bad debts                                                           9,368              12,984
     Changes in:
       Accounts receivable                                              47,490             (47,710)
       Other current assets                                            (42,620)              3,152
       Accounts payable                                              1,099,557              53,112
       Accrued expenses                                                687,435             165,643
       Deferred revenue                                                136,547             (29,500)
                                                                ----------------    ----------------

   Net Cash Used In Operating Activities                              (381,534)         (1,780,514)
                                                                ----------------    ----------------

Cash Flows from Investing Activities
   Purchase of property and equipment                                   (5,286)
                                                                ----------------

Cash Flows from Financing Activities
   Proceeds from notes payable to stockholders                           3,558           1,130,994
   Proceeds from sales of common stock                                                     100,000
   Proceeds from sales of preferred stock                              380,000             325,000
                                                                ----------------    ----------------

   Net Cash Provided by Financing Activities                           383,558           1,555,994
                                                                ----------------    ----------------

Net change in cash                                                      (3,262)           (224,520)
Cash at beginning of year                                                3,397             227,917
                                                                ----------------    ----------------

Cash at end of year                                             $          135      $        3,397
                                                                ================    ================


Cash paid during the year for:
   Interest                                                     $            0      $            0

Supplemental disclosure of non-cash transactions:
  Conversion of Series A preferred stock to common                                  $       72,374
</TABLE>








               See accompanying summary of accounting policies and
                         notes to financial statements.

                                     Page 12
<PAGE>


Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


                                 VERDISYS, INC.
                          NOTES TO FINANCIAL STATEMENTS


NOTE 1 - SUMMARY OF ACCOUNTING POLICIES

Business.  Verdisys, Inc. ("Verdisys") was formed in California on April 7, 1999
---------
as  TheAgZone,  Inc. to build and  operate an  agricultural  e-commerce  website
portal.  This plan was pursued until fall of 2000 when funding was depleted.  In
January 2001 the name was changed to Verdisys, Inc. and the agricultural website
portal  operation was  terminated.  In May 2001,  Verdisys  began selling secure
intra-company and wide-area network satellite  communications  systems. The 2002
business  plan  involved  providing  satellite  linkages to energy  companies to
manage distant oil and gas pumping wells, power distribution and other equipment
sites by remote computer control.

In June 2003,  Verdisys began a new line of business in lateral drilling for the
search and production of oil and gas reserves using licensed technology acquired
April 2003.

Management estimates. The preparation of financial statements in conformity with
---------------------
accounting  principles  generally  accepted  in the  United  States  of  America
requires  management to make estimates and assumptions  that affect the reported
amounts  of  assets,  liabilities,  revenues  and  expenses,  as well as certain
financial  statement  disclosures.  While management believes that the estimates
and  assumptions  used  in the  preparation  of  the  financial  statements  are
appropriate, actual results could differ from these estimates.

Cash Equivalents.  Highly liquid  investments with original  maturities of three
-----------------
months or less are considered cash equivalents.

Revenue  Recognition.  Revenue is  derived  from  sales of  satellite  hardware,
---------------------
satellite  bandwidth and satellite  service.  Revenue from satellite hardware is
recognized when the hardware is installed.  Revenue from satellite  bandwidth is
recognized evenly over the term of the contract.  Revenue from satellite service
is recognized when the services are performed. Verdisys provides no warranty but
sells  commercially  obtained 3 to 12 month  warranties for satellite  hardware.
Verdisys has no return policy.

Allowance  for  Doubtful  Accounts.  Bad debt  expense  is  recognized  based on
-----------------------------------
management's estimate of likely losses per year, based on past experience and an
estimate of current year uncollectible  amounts. The allowance was $22,352 as of
December 31, 2002.

Property  and  equipment  is  valued  at cost.  Additions  are  capitalized  and
----------------------------------------------
maintenance and repairs are charged to expense as incurred.  Gains and losses on
dispositions of equipment are reflected in operations.  Depreciation is provided
using the  straight-line  method over the estimated  useful lives of the assets,
which are three years for computers and seven years for furniture.

Impairment  of Long-Lived  Assets.  Verdisys  reviews the carrying  value of its
----------------------------------
long-lived  assets  annually  or  whenever  events or changes  in  circumstances
indicate that the  historical  cost-carrying  value of an asset may no longer be
appropriate. Verdisys assesses recoverability of the carrying value of the asset
by  estimating  the  future net cash flows  expected  to result  from the asset,
including eventual  disposition.  If the future net cash flows are less than the
carrying  value  of the  asset,  an  impairment  loss is  recorded  equal to the
difference between the asset's carrying value and fair value.

Stock  options  and  warrants.   Verdisys  accounts  for  non-cash   stock-based
------------------------------
compensation  issued to  non-employees in accordance with the provisions of SFAS
No. 123 and EITF No. 96-18, Accounting for Equity Investments That Are Issued to
Non-Employees  for Acquiring,  or in Conjunction with Selling Goods or Services.
Common stock issued to non-employees  and consultants is based upon the value of
the  services  received  or the quoted  market  price,  whichever  value is more
readily determinable. Verdisys accounts for stock options and warrants issued to
employees  under  the  intrinsic  value  method.  Under  this  method,  Verdisys
recognizes no  compensation  expense for stock options or warrants  granted when
the number of underlying shares is known and the exercise price of the option or
warrant is greater  than or equal to the fair  market  value of the stock on the
date of grant.  The following  table  illustrates the effect on net loss and net
loss per  share if  Verdisys  had  applied  the fair  value  provisions  of FASB
Statement No. 123,  Accounting  for  Stock-Based  Compensation,  to  stock-based
employee compensation.


                                     Page 13
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment



                                                       2002            2001
                                                  -------------    -------------

Net loss as reported                              $ (3,128,782)    $ (2,497,120)

Less: stock based compensation determined
      under fair value-based method                          0                0
                                                  -------------    -------------

      Pro forma net loss                          $ (3,128,782)    $ (2,497,120)
                                                  =============    =============

Basic and diluted net loss per common share:
As reported                                       $       (.23)    $       (.19)
Pro forma                                                 (.23)            (.19)



The weighted  average fair value of the stock  options  granted  during 2002 and
2001  was $.50  and  $.25,  respectively.  Variables  used in the  Black-Scholes
option-pricing  model include (1) 5.0%  risk-free  interest  rate,  (2) expected
option life is the actual remaining life of the options as of each year end, (3)
expected volatility is zero, and (4) zero expected dividends.

Income  Taxes.  Income tax expense is based on reported  earnings  before income
--------------
taxes. Deferred income taxes reflect the impact of temporary differences between
assets and  liabilities  recognized  for financial  reporting  purposes and such
amounts  recognized for tax purposes,  and are measured by applying tax rates in
effect in years in which the differences are expected to reverse.

Basic and  diluted  earnings  per share.  Basic  earnings  per share  equals net
----------------------------------------
earnings divided by weighted average shares outstanding during the year. Diluted
earnings  per share  include the impact of common  stock  equivalents  using the
treasury  stock  method  when the effect is  dilutive.  There  were no  dilutive
securities during the periods presented.

Recently issued accounting pronouncements. Verdisys does not expect the adoption
------------------------------------------
of recently issued  accounting  pronouncements  to have a significant  impact on
their results of operations, financial position or cash flow.


NOTE 2 - PROPERTY AND EQUIPMENT

Property and equipment consisted of the following at December 31, 2002:

     Description                           Life             Amount
     -----------                           ----             ------
     Computer equipment                   3 years          $ 28,065

     Other equipment and furniture        7 years            17,523

     Furniture and fixtures               7 years             2,195
                                                           --------

                                                             45,588

             Less: accumulated depreciation                 (41,833)
                                                           --------


                                                           $  3,755
                                                           ========


Depreciation expense totaled $11,380 and $13,434 in 2002 and 2001, respectively.








                                     Page 14
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


NOTE 3 - DEFERRED REVENUE

Typical  satellite  bandwidth  contracts cover 36 months.  Verdisys receives the
cash up front,  records deferred revenue and recognizes  revenue evenly over the
contract.  $56,180 will be  recognized  in 2003 and $80,367  will be  recognized
during 2004 and 2005.


NOTE 4 - NOTES PAYABLE TO STOCKHOLDERS

Notes payable as of December 31, 2002 consists of the following:

     "Bridge debt" notes payable, with 10% interest,
     no collateral, convertible to Series B convertible
     preferred stock at conclusion of that financing,
     and due as follows:
        - amounts past due                                          $    590,000
        - amount due after at least $1 million in Series B
          Preferred Stock sales                                          200,000

     "Convertible notes," with 10% interest, no collateral,
     convertible to Series B convertible preferred stock
     at conclusion of that financing, and due in 2003                    686,004

     Note payable to a stockholder, with 8% interest and
     no collateral, and past due                                         103,558
                                                                    ------------

                                                                    $  1,579,562
                                                                    ============

The Series B convertible  preferred  stock  financing was scheduled to expire in
July 2002 but was extended and expired in July 2003.

The "bridge  debt" notes were issued from December 2000 to July 2001. A total of
$1,100,000  was raised and  $310,000  was  converted to  Convertible  Notes,  as
summarized  above. In connection with these issuances,  1,500,000  warrants were
issued  with  exercise  prices of $.10 to $.15 per share,  and  another  448,575
warrants were issued with exercises  prices of $.75 to $2.00 per share.  Related
interest expense of $184,167 was recorded in 2001 for these bridge debt warrants
and another $20,000 in interest expense was recorded for "convertible  notes" as
described below.

The  "convertible  notes" were issued from  February  through May 2001 for total
proceeds of $376,004.  $310,000 in notes was transferred  from "bridge debt" for
total convertible notes of $686,004. In connection with these issuances, 231,998
warrants were issued with exercise  prices of $2 per share.  Since this exercise
price was above the stock selling  price at that time,  no interest  expense was
recorded.












                                     Page 15
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


NOTE 5 - INCOME TAXES

Verdisys uses the liability  method,  where deferred tax assets and  liabilities
are  determined  based on the  expected  future tax  consequences  of  temporary
differences between the carrying amounts of assets and liabilities for financial
and income tax reporting  purposes.  During 2002 and 2001, Verdisys incurred net
losses  and,  therefore,  has no tax  liability.  The  net  deferred  tax  asset
generated by the loss carry-forward has been fully reserved.  The cumulative net
operating loss  carry-forward is approximately  $9,300,000 at December 31, 2002,
and will expire in the years 2019 through 2022.

At December 31, 2002, deferred tax assets consisted of the following:

                                                          2002
                                                    ----------------

        Deferred tax assets

          Net operating losses                      $    3,172,000

          Less:  valuation allowance                    (3,172,000)
                                                    ----------------

        Net deferred tax asset                      $            0
                                                    ================


NOTE 6 - PREFERRED STOCK

3,436,996  shares of Series A  preferred  stock were  issued in 1999 and 2000 at
$1.50 per share,  and all have been  converted to common stock on a  one-for-one
basis. This Series had a stated $.15  noncumulative  dividend,  with a $1.50 per
share liquidation preference and redemption price. They were convertible anytime
by the  holder  at the  current  conversion  price as  stated,  and  convertible
automatically 12 months after issuance.

650,000 and 760,000  shares of Series B preferred  stock were issued in 2001 and
2002, respectively,  for $.50 per share. There is a $.10 noncumulative dividend,
with a $.50 per share  liquidation  preference  and redemption  price.  They are
convertible anytime by the holder into common shares on a one-for-one basis, and
must be converted upon completion of an initial public offering.  The conversion
rate is adjustable on the  occurrence of certain  events such as a change in the
offering price of Verdisys common stock.


NOTE 7 - STOCK OPTIONS AND WARRANTS

Verdisys follows the disclosure  requirements of FASB Statement 123,  Accounting
for Stock Based Compensation Plans. Verdisys' Stock Option Plan provides for the
grant of both qualified and  non-qualified  options to directors,  employees and
consultants.  In addition,  Verdisys  issues stock warrants from time to time to
employees,  consultants,  stockholders  and  creditors as  additional  financial
incentives.  The plans and warrants  issuance are  administered  by the Board of
Directors, who have substantial discretion to determine which persons,  amounts,
time,  price,  exercise terms,  and  restrictions,  if any.  Options differ from
warrants only in that options are issued to employees and directors and warrants
are issued to consultants and investors.

Verdisys uses the intrinsic value method of calculating compensation expense for
employees and  directors,  as described and  recommended  by APB Opinion 25, and
allowed by FASB  Statement  123.  During the years ended  December  31, 2002 and
2001,  compensation  expense  of  $401,291  and  $341,324,   respectively,   was
recognized for the issuance of options to employees and directors where exercise
prices were below selling  prices to investors at each date of grant.  There has
been no trading market for Verdisys stock as of May 27, 2003.

During 2002 and 2001, interest expense of $4,800 and $204,167, respectively, was
recognized for the issuance of warrants to investors  where exercise prices were
below selling prices to investors.




                                     Page 16
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


During  2002,   Verdisys  issued  warrants  to  consultants   whose  stock-based
compensation  must be  recorded at fair value  pursuant  to FASB  Interpretation
Number 44. The compensation  cost recorded for these warrants was $392,000 based
on the Black-Scholes option pricing model as suggested by FASB Statement 123. No
warrants were issued to consultants in 2001.

Summary information regarding options and warrants is as follows:

<TABLE>
<CAPTION>
                                                      Weighted                    Weighted
                                                       average                     average
                                        Options      Share Price    Warrants     Share Price
                                     -------------   -----------   -----------   -----------

<S>                                    <C>           <C>            <C>          <C>
Outstanding at December 31, 2000        1,455,372    $     . 12       558,029    $     . 61

Year ended December 31, 2001:
   Granted                              3,963,827          . 10     2,110,242          . 44
   Forfeited                             (431,370)         . 10
                                     -------------   -----------   -----------   -----------

Outstanding at December 31, 2001        4,987,829          . 11     2,668,271          . 47

Year ended December 31, 2002:
   Granted                              7,155,001          . 10     1,100,000          . 10
   Forfeited                             (717,973)         . 10      (217,362)         . 21
                                     -------------   -----------   -----------   -----------

Outstanding at December 31, 2002       11,424,857    $     . 10     3,550,909    $     . 36
                                     =============   ===========   ===========   ===========
</TABLE>

Options outstanding and exercisable as of December 31, 2002:

                                              Outstanding           Exercisable
                                         Number       Remaining        Number
                     Exercise Price     of Shares      life          of Shares
                     --------------     ---------   ----------    -------------

                           $.10        6,958,333        9 years         617,407
                            .10        2,190,833        8 years       1,301,908
                            .10          620,000        7 years         545,000
                            .15          700,000        7 years         700,000
                            .10          946,895        3 years         795,447
                            .10            8,796        2 years           8,796
                      -------------   ----------    -----------   -------------

                                      11,424,857                      3,968,558
                                      ==========                  =============

Warrants outstanding and exercisable as of December 31, 2002:

                                              Outstanding           Exercisable
                                         Number       Remaining        Number
                     Exercise Price     of Shares      life          of Shares
                     --------------     ---------   ----------    -------------

                           $.10        1,000,000        5 years       1,000,000
                            .10          900,000        4 years         900,000
                            .15          841,667        4 years         841,667
                            .50           20,000        4 years          20,000
                           1.00          193,000        4 years         193,000
                           2.00          255,575        4 years         255,575
                            .15           58,333        3 years          58,333
                           2.00           50,000        3 years          50,000
                            .75          232,334        1 years         232,334
                      -------------   ----------    -----------   -------------

                                       3,550,909                      3,550,909
                                       =========                  =============


                                     Page 17
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


NOTE 8 - MAJOR CUSTOMERS AND VENDORS

One  customer  accounted  for 87% and 21% of total  revenues  in 2002 and  2001,
respectively.  During 2001,  Hughes Network Systems was the sole major satellite
communications  services  and  equipment  vendor  and it  accounted  for  13% of
purchases in 2001.  In  mid-2002,  services by this vendor were  terminated  and
replaced by Spacenet who accounted for 87% of purchases in 2002.


NOTE 9 - COMMITMENTS & CONTINGENCIES

Verdisys's current office is in Houston, Texas. The offices for 2001 and part of
2002 were in Aliso Viejo,  California.  The Aliso Viejo lease was for $1,800 per
month and expired August 2002. The Houston office was in the home of an employee
on a monthly  basis for $900 per month through  August 2002. In September  2002,
Verdisys  signed a 13-month  office lease for $1,483 per month.  Future  minimum
lease payments under the lease as of December 31, 2002 are $13,343 in 2003.

Verdisys also has a consulting  agreement with its current majority  stockholder
for $10,000 per month through  April 30, 2005,  with $120,000 due during each of
2002, 2003 and 2004, and $40,000 in 2005.  $138,000 was accrued and unpaid under
this agreement as of December 31, 2002.

In April 2002, Verdisys entered into a three-year  employment agreement with its
then  CEO.  The base  salary  under the  agreement  was  $250,000  per year with
quarterly  performance  bonuses and 2,000,000  stock options granted in 2002 and
exercisable  at $.10 per share and  vesting  quarterly  over a two-year  period.
$400,000  and  $175,000 in expense was  incurred in 2002  relating to the vested
portion of these options and unpaid salary, respectively. In November 2002, this
CEO quit and Verdisys is now in negotiations  over what portion of these amounts
and also the unvested  options,  if any, is due. As of May 27, 2003,  management
believes  the current  accrual is adequate  and that no further  expense will be
necessary on the unvested options.


NOTE 10 - LITIGATION

In August 2002,  Verdisys  settled a lawsuit  filed  against it in late 2001 for
breach of promissory note and breach of security  agreement,  by agreeing to pay
$228,494. Verdisys agreed to pay $15,000 on October 1, 2002 and $5,000 per month
from  November  2002  through  August  2004.  A  balloon  payment  is due of the
remaining amount in August 2004. As of May 27, 2003, $20,000 in monthly payments
are delinquent. All amounts are accrued as of December 31, 2002.


NOTE 11 - SUBSEQUENT FINANCING (unaudited)


From April 2003  through June 2003,  Verdisys  sold  1,239,000  shares of common
stock in  private  placements  for $.50 per  share  and $.75 per share for total
proceeds  of  $779,250  with  $764,150  to  Verdisys  net  of  $15,100  cost  of
fundraising.


In early 2003,  Verdisys  issued a convertible  promissory note in the amount of
$50,000 with 100,000 $.10 warrants that expire in January 2008.

In early  2003,  Verdisys  converted  1,410,000  shares of Series B  convertible
preferred stock into 1,410,000 shares of common stock.

From April  2003  through  June 2003,  Verdisys  converted  $1,506,190  of notes
payable and accrued interest to investors to 2,877,776 shares of common stock.

From April 2003 through June 2003,  2,409,291 options were exercised at $.10 per
share for 2,409,291 shares of common stock. In lieu of cash,  Verdisys agreed to
expense the exercise price as compensation of $240,929.


                                     Page 18
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


From April 2003  through  June  2003,  1,580,000  warrants  were  exercised  for
1,580,000 shares of common stock.  $56,500 in cash was received for the exercise
of 430,000 warrants, accounts payable was reduced by $95,000 for the exercise of
950,000  warrants  and notes  payable to investor was reduced by $20,000 for the
exercise of 200,000 warrants.

In April 2003,  Verdisys issued  2,000,000  shares of common stock for software.
The shares were valued at $1,000,000. The software has been determined to not be
useful and was fully impaired as of June 30, 2003.

In June 2003, 100,000 shares valued at $75,000 were issued to a consultant.

In April 2003, Verdisys issued 100,000 $.10 warrants that expire in January 2007
for legal services.

In April 2003,  Verdisys  issued  1,280,000 10 year $.10  options to  employees.
30,000  options vest monthly over three months,  750,000  options vest quarterly
over three  years,  300,000  options  vest  quarterly  over one year and 200,000
options vest quarterly over two years. The intrinsic value and the fair value of
these options totals $193,250.

Verdisys  began  selling stock at $2 per share in July 2003. As of September 18,
2003, $1,127,000 in cash had been received from this effort.


NOTE 12 - SUBSEQUENT EVENTS (unaudited)

In April 2003,  an  individual  licensed  his lateral  drilling  technology  and
equipment to Verdisys. Verdisys is required to pay $2,750,000 plus 10 percent of
related  gross  revenue.  $100,000  was due upon  signing and a note payable for
$2,650,000 plus 8 percent is to be paid out from May 2003 through March 2004 for
a total payout of $2,970,000.

In April 2003,  Verdisys  signed a drilling  service  contract with Energy 2000,
whereby  Energy  2000 will pay  Verdisys a minimum  of  $1,800,000  for  lateral
drilling of 45 wells. This contract is a fixed fee contract with the total price
depending on the number of wells drilled and offshoot lateral bores drilled.  In
addition,  Verdisys  will  receive an 80 percent  interest in the net  operating
income after payback from these  properties  and will also be reimbursed  for 20
percent of its field costs.

During the summer of 2003, Verdisys  negotiated  settlements with 9 vendors plus
the two original  founders for various  debts carried on the books at $1,096,501
for $71,600 cash, 33,333 shares of stock (valued at $.50 or $16,666) and 150,000
warrants exercisable at $.10 and valued at $.40 or $60,000. $460,235 is shown in
2003 as debt forgiveness  income for the vendors and the $548,000 related to the
original founders is shown in 2003 as a contribution to capital.

In June 2003, Verdisys settled a lawsuit filed against it in April 2001 for past
due  accounts  payable.  In July 2001,  Verdisys  had  previously  agreed to pay
$10,277 to settle the  account.  Verdisys  only paid $4,277  under the  original
settlement  agreement.  In June 2003, Verdisys issued 100,000 shares of Verdisys
common stock to settle the remaining amount.

On July  18,  2003,  Verdisys  signed  an  Agreement  and  Plan of  Merger  with
Reconstruction  Data Group, Inc. (RDGI), a publicly  reporting  inactive entity.
The shareholders of Verdisys received  25,202,539 shares of RDGI in exchange for
all of the 25,202,539  shares of Verdisys then  outstanding.  Verdisys  became a
wholly-owned subsidiary of RDGI. As of that transfer, Verdisys shareholders will
now own 94.4% of the outstanding stock of the combined entity.








                                     Page 19
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


                 Pro Forma Consolidated Condensed Balance Sheet
                 ----------------------------------------------

The following pro forma balance sheet has been derived from the balance sheet of
Reconstruction  Data Group,  Inc. ("RDGI") at December 31, 2002 and adjusts such
information to give effect to the acquisition of Verdisys, Inc. ("Verdisys"), as
if the  acquisition  had occurred at December 31,  2002.  The pro forma  balance
sheet is presented  for  informational  purposes only and does not purport to be
indicative  of  the  financial   condition  that  would  have  resulted  if  the
acquisition  had been  consummated  at December 31, 2002.  The pro forma balance
sheet should be read in  conjunction  with the notes  thereto and the  financial
statements and related notes thereto contained elsewhere in this filing.

A pro-forma consolidated balance sheet is presented below.

<TABLE>
<CAPTION>
                                                       RDGI           Verdisys         DR (CR)         Pro Forma
                                                     12/31/02         12/31/02       Adjustments        Combined
                                                  --------------   --------------   --------------   --------------
<S>                                               <C>              <C>              <C>             <C>
Cash                                              $      11,920    $         135    $     (11,920)  $          135
Accounts receivable, net                                                  10,402                            10,402
Employee advances                                                         42,620                            42,620
Property and equipment, net                              19,934            3,755          (19,934)           3,755
Deposit                                                   1,313                            (1,313)
                                                  --------------   --------------                    --------------

                                                  $      33,167    $      56,912                     $      56,912
                                                  ==============   ==============                    ==============


Accounts payable and accrued liabilities          $      21,446    $   2,467,800           21,446    $   2,467,800
Current portion of notes payable                         55,000        1,579,562           55,000        1,579,562
Current portion of deferred revenue                      16,368           56,180           16,368           56,180
L-T portion of notes payable                              5,000                             5,000
L-T portion of deferred revenue                                           80,367                            80,367
                                                  --------------   --------------                    --------------

                                                         97,814        4,183,909                         4,183,909
                                                  --------------   --------------                    --------------

Convertible preferred stock,
  40,000,000 shares authorized
  - Series A, 2,000,000 shares
      allocated, none outstanding
  - Series B, 1,410,000 shares
      issued and outstanding                                             705,000          705,000
Common stock, no par value,
  50,000,000 shares authorized,
  3,651,500 and 14,963,139
  shares issued and outstanding                         323,825                           323,825
                                                                                       (4,199,040)
                                                                                         (705,000)       4,904,040
Common stock, no par value
  60,000,000 shares authorized,
  13,553,139 shares issued and
  outstanding                                                          4,199,040        4,199,040
Additional paid in capital                               19,167        1,913,437           19,167        1,913,437
Accumulated deficit                                    (407,639)     (10,944,474)        (407,639)     (10,944,474)
                                                  --------------   --------------                    --------------

                                                        (64,647)      (4,126,997)                       (4,126,997)
                                                  --------------   --------------                    --------------

                                                  $      33,167    $      56,912                     $      56,912
                                                  ==============   ==============                    ==============
</TABLE>










                                     Page 20
<PAGE>



Verdisys, Inc. (formerly Reconstruction Data Group, Inc.)     Report on Form 8-K
                                                                      Attachment


             Notes to Pro Forma Consolidated Condensed Balance Sheet
             -------------------------------------------------------

(1)  The acquisition occurred July 18, 2003.
(2)  Issuance  of  25,202,539  shares  of  common  stock  of RDGI for all of the
     outstanding stock of Verdisys.
(3)  Prior to the  reorganization,  RDGI canceled  2,151,500 common shares in an
     agreement with certain of its  shareholders,  including the spin-off of all
     prior RDGI operations, assets and liabilities.  After this cancellation and
     immediately  prior to its merger with Verdisys,  RDGI shareholders will own
     1,500,000  shares of RDGI. No prior RDGI business  operations will continue
     in the surviving entity.
(4)  There were  13,553,139  shares  issued and  outstanding  by  Verdisys as of
     December  31,  2002.  Shares  issued  from  January  1 - July 18,  2003 are
     summarized as follows:

                                                       Shares           Value
                                                 --------------   --------------
     Cash                                            2,819,000    $     935,650
     Services                                        2,509,291          861,480
     Conversion of preferred stock                   1,410,000          705,000
     Conversion of debt                              2,911,109        1,556,190
     Asset purchase                                  2,000,000        1,000,000
                                                 --------------   --------------

                                                    11,649,400    $   5,058,320
                                                                  ==============

     Add:  shares outstanding, December 31, 2002    13,553,139
     RDGI shares                                     1,500,000
                                                 --------------


                                                    26,702,539
                                                 ==============


     Shares included in the pro forma schedule are as follows:

     Balances, December 31, 2002                    13,553,139
     Conversion of preferred stock                   1,410,000
                                                 --------------

                                                    14,963,139
                                                 ==============


After the merger, there will be 26,702,539 shares of common stock outstanding of
RDGI, and Verdisys will cease to exist as a separate corporation.




















                                     Page 21

                                End of Attachment

</TEXT>
</DOCUMENT>
