TRI NATIONAL DEVELOPMENT CORP, PRE 14A, 2000-12-06

TRI NATIONAL DEVELOPMENT CORP
PRE 14A, 2000-12-06
LAND SUBDIVIDERS & DEVELOPERS (NO CEMETERIES)

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TRI-NATIONAL DEVELOPMENT CORP.
480 Camino Del Rio South, Suite 140
San Diego, California 92108

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD DECEMBER 29, 2000

TO THE SHAREHOLDERS OF TRI-NATIONAL DEVELOPMENT CORP.:

The annual meeting of the shareholders of Tri National Development
Corp. (the "Company") will be held at 480 Camino Del Rio South, Suite 140,
San Diego, California 92108, on December 29, 2000, at 9:00 a.m. for the
following purpose:

1. To elect a Board of Directors for the Company;

2. To approve the continuation of Ludlow & Harrison, LLP as the
Company's independent public accountants for the fiscal year
ending April 30, 2001.

3. To consider and approve of the 2000 Equity Incentive Plan.

4. To transact such other business as may properly come before the
meeting or any adjournment thereof.

THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT YOU VOTE FOR
EACH OF THE NOMINEES TO THE BOARD OF DIRECTORS AND RECOMMENDS THAT YOU VOTE
"FOR" APPROVAL OF EACH OTHER ITEM LISTED ON THIS NOTICE OF ANNUAL MEETING
OF SHAREHOLDERS.

Shareholders of record at the close of business on October 31, 2000,
are the only persons entitled to notice of and to vote at the meeting.

Your attention is directed to the attached Proxy Statement. WHETHER
OR NOT YOU EXPECT TO BE PRESENT AT THE ANNUAL MEETING, PLEASE FILL IN,
SIGN, DATE AND MAIL THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN ORDER TO
SAVE THE COMPANY FURTHER SOLICITATION EXPENSE. If you are present at the
meeting, you may then revoke your proxy and vote in person, as explained in
the Proxy Statement in the section entitled "ANNUAL MEETING OF SHAREHOLDERS
- DECEMBER 29, 2000." A return envelope is enclosed for your convenience.

Jason A. Sunstein,
Secretary

Dated: December 18, 2000

<PAGE>
________________________________________

PROXY STATEMENT

________________________________________

TRI-NATIONAL DEVELOPMENT CORP.
480 Camino Del Rio South, Suite 140
San Diego, California 92108

ANNUAL MEETING OF SHAREHOLDERS - DECEMBER 29, 2000

The enclosed Proxy is solicited by the Board of Directors of Tri-National
Development Corp. (the "Board") in connection with the annual
meeting of shareholders of Tri-National Development Corp. (the "Company")
to be held on December 29, 2000 at 9:00 A.M. at 480 Camino Del Rio South,
Suite 140, San Diego, California 92108, and at any adjournments thereof.
The cost of solicitation, including the cost of preparing and mailing the
Notice of Shareholders' Meeting and this Proxy Statement, will be paid by
the Company. Such mailing took place on approximately December 18, 2000.
Representatives of the Company may, without cost to the Company, solicit
Proxies for the management of the Company by means of mail, telephone or
personal calls.

A Proxy with respect to the Company may be revoked before the meeting
by giving written notice of revocation to the Secretary of the Company, or
may be revoked at the meeting, prior to voting. Unless revoked, properly
executed Proxies with respect to the Company will be voted as indicated in
this Proxy Statement. In instances where choices are specified by the
shareholders in the Proxy, those Proxies will be voted or the vote will be
withheld in accordance with each shareholder's choice. An "abstention" on
any proposal will be counted as present for purposes of determining whether
a quorum of shares is present at the meeting with respect to the proposal
on which the abstention is noted, but will be counted as a vote "against"
such proposal. Should any other matters come before the meeting, it is
the intention of the persons named as proxies in the enclosed Proxy to act
upon them according to their best judgment.

Only shareholders of record at the close of business on October 31,
2000 may vote at the meeting or any adjournments thereof. As of that date
there were issued and outstanding approximately 34,685,464 common shares of
all classes, no par value, of the Company. Each shareholder of the Company
is entitled to one vote for each share of the Company held. Voting for the
election of directors is not cumulative, which means that the holders of a
majority of the Company's outstanding shares have the power to elect the
entire board of directors of the Company. None of the matters to be
presented at the meeting will entitle any shareholder of the Company to
appraisal rights. In the event that Proxies which are sufficient in number
to constitute a quorum are not received by December 25, 2000, the persons
named as Proxies may propose one or more adjournments of the meeting to
permit further solicitation of Proxies. Such adjournments will require the
affirmative vote of the holders of a majority of the shares present in
person or by Proxy at the meeting. The persons named as proxies will vote
in favor of such adjournment. At the annual meeting, the shareholders of
the Company will be asked to elect a Board of Directors, approve the
continuation of Ludlow & Harrisson, LLP as the independent public
accountant for the Company and approve the 2000 Equity Incentive Plan.

SHARE OWNERSHIP

The following table sets forth certain information regarding
beneficial ownership of the Common Stock as of October 31, 2000 (based on
a total of 34,685,464 outstanding shares of Common Stock) by (1) all
persons know by the Company to own beneficially more than 5% of the common
stock, (II) each of the Company's Directors, (III) each of the Named
Executive Officers, and (IV) all executive officers and directors as a
group. Except as otherwise indicated, the Company believes the persons
named in the table have sole voting and investment power with respect to
all shares beneficially owned, subject to community property laws where
applicable.

<TABLE>
<CAPTION>
NAME AND ADDRESS OF SHARES BENEFICIALLY PERCENTAGE
BENEFICIAL OWNER (1) OWNED BENEFICIALLY OWNED
-------------------- ----- ------------------
<S> <C> <C>
Michael A. Sunstein (II)(III) 2,063,240 6.519%

The A.J. Hester Group (I) 2,000,000 6.320%
C/o Josephtal and Co.
200 Park Ave., 24th Fl.
New York, NY 10166

Jerry Parker, M.D. (II)(III) 1,850,857 5.848%

Jason Sunstein (III) 275,000 0.869%

Paul G. Goss (III) 125,000 *

Dr. Robert Rosen (II) 140,000 *

Jay Pasternak (II) 121,287 *

Gilbert Fuentes (III) 50,000 *

Ted Takacs (II) 50,000 *

Shane Kennedy (II) 1,200 *

Advisory Team 1,242,000 3.924%

All Directors and Officers as
a Group (IV) 4,775,584 15.09%

TOTAL OF ABOVE 8,017,584 25.34%
</TABLE>

(1) Except where otherwise noted, the address of the Company's directors
and executive officers is c/o Tri-National Development Corp., 480 Camino
Del Rio S., Suite 140, San Diego, California 92108.

ANNUAL REPORT OF THE COMPANY

The semiannual report of the Company containing unaudited financial
statements for the three months ended July 31, 2000 and audited financial
statements for the fiscal year ended April 30, 2000 was mailed to the
shareholders on or about December 18, 2000.

<PAGE>
PROPOSAL NO. 1

ELECTION OF DIRECTORS

It is intended that the enclosed Proxy will be voted for the election
of the seven (7) persons named below as directors for the Company unless
such authority has been withheld in the respective Proxy. The term of
office of each person elected to be a director of the Company will be until
the next regular or annual meeting of the shareholders at which election of
directors is an agenda item and until his successor is duly elected and
shall qualify. Pertinent information regarding each nominee for the past
five years is set forth following his name below.

<TABLE>
<CAPTION>
POSITIONS HELD
NAME AGE WITH THE COMPANY SINCE
---- --- ---------------- -----
<S> <C> <C> <C>
Michael A. Sunstein 58 Director, CEO & 1989
President
Gilbert Fuentes 67 Chief Financial Officer 1996
Shane Kennedy 36 Director 1994
Dr. Jerry Parker 63 Director and 1996
V.P. Medical Development
Jay Pasternak 43 Director 1994
Dr. Robert Rosen 53 Director 1989
Ted Takacs 52 Director 1994
</TABLE>

MICHAEL A. SUNSTEIN. Mr. Sunstein has been the Chief Executive Officer and
a Director of the Company since its founding 1989. Prior to joining the
Company, Mr. Sunstein spent 15 years in the housing industry, primarily
with Kaufman and Broad Homes, Inc., a New York Stock Exchange listed
company, where he served as President of the Midwestern Division and acting
President of the East Coast Division. In those capacities he was
responsible for the financial, building and delivery of approximately
$30,000,000 in housing sales annually. He resigned from Kaufman and Broad
and started his own firm in the building and materials and single-family
home industry in Michigan, prior to moving to San Diego in 1982.

GILBERT FUENTES. Mr. Fuentes has been the Chief Financial Officer since
1996. He has 25 years of experience in the banking industry. He has held
the positions of President and Chief Executive Officer, Senior Vice
President, Chief Financial Officer, Treasurer and Comptroller for multi-
billion dollar banking organizations. He has authored several articles in
the fields of finance and cash management, as well as the 1992 and 1993
Economic Forecast of the United States and Mexico, published by the U.S.
Mexico Foundation. Mr. Fuentes has developed innovative cash management
systems, investment strategies and strategic financial plans that resulted
in millions of dollars of incremental income for his former employers.

SHANE KENNEDY. Mr. Kennedy has been a Director of the Company since 1994.
Mr. Kennedy has been an insurance adjuster for the Insurance Corporation of
British Columbia since 1990 and is also President of Northern Trader
Incorporated, which is an import and export company. He is Canadian
citizen. Mr. Kennedy received his B.A. degree in Political Science from
the University of British Columbia.

<PAGE>
DR. JACOB J. PARKER. Dr. Parker has been a Director and V.P. Medical
Development of the Company since 1996. Dr. Parker is currently Medical
Director and Director of Radiology for several MRI centers and breast
imaging centers in Northern California since 1973. He was previously Chief
of Radiology and Nuclear Medicine at Ross General Hospital, Clinical
Professor of Radiology at the University of California, Irvine, and
Instructor of Radiology at the University of Southern California Medical
Center from 1970 to 1988. Dr.Parker received his M.D. from the University
of Manitoba, Canada in 1962.

JAY PASTERNAK. Mr. Pasternak has been a Director of the Company since
1994. He is a Canadian citizen who has spent the last ten years in the
private practice of mental health counseling at the Denwood Institute in
Toronto, Canada, Ontario Hydro, Futures Ontario and the Hubar Memorial
Hospital, all Canadian government facilities. Mr. Pasternak is a C.L.S.
graduate from McMaster University in Hamilton, Ontario (1994) and a Human
Services Counselor graduate from George Brown University 1996.

DR. ROBERT R. ROSEN. Dr. Rosen has been a Director of the Company since
1989. Dr. Rosen is an opthamologist and is presently Executive Director of
MAC-IPA, a 47 physician multi-specialty IPA in Montgomery County,
Tennessee, where he is responsible for policy, long range strategic
planning, physician recruitment, contracting and utilization review. From
1993 to 1995 he was Medical Director of the MidSouth Eye Center in
Clarksville, Tennessee, a private practice, and Medical Director of EYE PA,
a nationwide integrated delivery system for eyecare, a subsidiary of
EYECORP/PRG. From 1992 to 1993 he was Associate Medical Director of East
County Physician Medical Group (IPA) in San Diego, California and from 1977
to 1993 he was President and Medical Director of Eye Care Professionals in
San Diego, a single specialty medical corporation. He was also Medical
Director of the Pearle Eye Foundation from 1987 to 1993, a non-profit
corporation and he also served as Medical Director for Pearle Visioncare,
a California Knox-Keane HMO from 1986 until 1993. Dr. Rosen was Assistant
Clinical Professor of Opthamology at the University of California, San
Diego from 1977 until 1993.

THEODORE TAKACS. Mr. Takacs has been a Director of the Company since 1994.
Mr. Takacs is a Canadian citizen who for the last ten years has been
engaged in labor relations consulting and negotiation. He is presently a
Constituency Assistant to the Honorable Bill Barlee in Osoyoos, British
Columbia where he also owns and operates an orchard.

None of the persons named as nominees for the Company are directors of
any other Reporting Companies. "Reporting Companies" include companies
with a class of securities registered pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended (the "1934 Act")or subject to
the requirements of Section 15(d) of the 1934 Act, or any company
registered as an investment company under the Investment Company Act of
1940, as amended (the "1940 Act").

The Company does not have a standing audit or nominating committee of
its board of directors, or committees performing similar functions.
However, the Company plans to form such committees, as it is a requirement
for listing on most exchanges and NASDAQ.

The Company has granted stock options to members of the board of
directors in 1996, 1997, 1998 and 1999 and anticipates future additional
grants pursuant to the approval of the Company's 2000 Equity Incentive
Plan. Other than these stock options, the Company does not pay
compensation to its directors, nor does it maintain any pension, retirement
or other arrangement other than as disclosed in the following table for
compensating its Directors. The board of directors for the Company held a
total of six (6) regular meetings during its last fiscal year. All
directors attended each of the meetings via telephone conferencing.

<PAGE>
The following table discloses the compensation paid to the company's
directors for the fiscal year ended April 30, 2000.

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------
Cash Compensation Security Grants
-------------------------------------------------------------
Number of (2)
Annual Consulting (1) Securities
Retainer Meeting Fees/ Number of Underlying
Name Fees Fees Other Fees Shares Options/SARs
-------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Michael A. Sunstein - - - - -

-------------------------------------------------------------------------------------
Shane Kennedy - - - - -

-------------------------------------------------------------------------------------
Jerry J. Parker, M.D. - - - - -

-------------------------------------------------------------------------------------
Robert Rosen, M.D. - - - - -

-------------------------------------------------------------------------------------
Theodore Takacs - - - - -

-------------------------------------------------------------------------------------
Jay Pasternak - - - - -

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

-------------------------------------------------------------------------------------
</TABLE>

(1) If elected, Mr. Sunstein and Mr. Fuentes as acting President and
Chief Executive Officer and Chief Financial Officer, respectively, could be
granted additional options in consideration for services in these other
capacities.

(2) No fees or options were paid or granted to any of the directors
of the Company for the year ending April 30, 2000. Future option grants to
all of the Company's officers and directors are being held pending the
approval of the Company's 2000 Equity Incentive Plan.

In voting for directors, you must vote all of your shares non-
cumulatively. This means that the owners of a majority of the Company's
outstanding shares have the power to elect the Company's entire board of
directors. The vote of a majority of shares of the Company represented at
the meeting, provided at least a quorum (a majority of the outstanding
shares) is represented in person or by proxy, is sufficient for the
election of the above nominees to the Board. By completing the Proxy, you
give the proxy the right to vote for the persons named in the table above.
If you elect to withhold authority for any individual nominee or nominees,
you may do so by making an "X" in the box marked "VOTE FOR NOMINEE(S) NOT
LINED OUT," and by striking a line through the nominees' name or names on
the Proxy that you do not vote for.

<PAGE>
Each of the nominees has agreed to serve as a director of the Company
until his replacement is elected and qualified. If any unforeseen event
prevents one or more of the nominees from serving as a director, your votes
will be cast for the election of a substitute or substitutes selected by
the Board. In no event, however, can the Proxies be voted for a greater
number of persons than the number of nominees named. Unless otherwise
instructed, the proxies will vote for the election of each nominee to serve
as a director of the Company.

THE BOARD RECOMMENDS THAT THE SHAREHOLDERS VOTE TO ELECT EACH OF THE
NOMINEES TO THE BOARD OF DIRECTORS OF THE COMPANY.

PROPOSAL NO. 2

RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS

The Board of Directors has selected Ludlow & Harrison, LLP as the
Company's independent accountants for the fiscal year ending April 30, 2001
and has directed that management submit the selection of independent
accountants to the stockholders for ratification at the Annual Meeting.
Ludlow & Harrison, LLP audited the Company's financial statements for
fiscal 2000. No representatives of Ludlow & Harrison, LLP are expected to
be present at the Annual Meeting.

Stockholders are not required to ratify the selection of Ludlow &
Harrison, LLP as the Company's independent accountants. However, the Board
is submitting the selection of Ludlow & Harrison to the stockholders for
ratification as a matter of good corporate practice. If the stockholders
fail to ratify the selection, the Board will reconsider whether or not to
retain that firm. Even if the selection is ratified, the Board in its
discretion may direct the appointment of a different independent accounting
firm at any time during the year if they determine that such a change would
be in the best interests of the Company and its stockholders.

The affirmative vote of the holders of a majority of the shares
represented and voting at the meeting will be required to ratify the
selection of Ludlow & Harrison, LLP.

THE BOARD OF DIRECTORS OF THE COMPANY RECOMMENDS THAT THE SHAREHOLDERS
OF THE COMPANY VOTE IN FAVOR OF THE PROPOSAL. UNLESS OTHERWISE INSTRUCTED,
THE PROXIES WILL VOTE IN FAVOR OF THE PROPOSAL TO RATIFY THE SELECTION OF
THE COMPANY'S INDEPENDENT PUBLIC ACCOUNTANTS.

PROPOSAL NO. 3

THE 2000 EQUITY INCENTIVE PLAN

The stockholders are being asked to approve the 2000 Equity Incentive
Plan (the "Incentive Plan") with an initial number of shares reserved for
issuance of 1,500,000, or approximately 4.2% of the total outstanding
shares of common stock on October 31, 2000.

The Board believes that the creation of the Incentive Plan is in the
best interests of the Company because of the continuing need to provide
stock options to attract and retain quality employees and remain
competitive in the industry. The granting of equity incentives under the
Incentive Plan plays an important role in the Company's efforts to attract
and retain employees of outstanding ability. The Board believes that the
reserve of shares with respect to which equity incentives may be granted will

<PAGE>
provide the Company with adequate flexibility to ensure that the Company
can continue to meet its goals and facilitate expansion of the Company's
employee base.

The Board approved the proposed creation of the Incentive Plan, to be
effective on stockholder approval. A summary of the principal provisions of
the Incentive Plan, assuming stockholder approval, is set forth below.

Incentive Plan

The purpose of the Incentive Plan is to offer eligible persons an
opportunity to participate in the Company's future performance through
awards of stock options, restricted stock and stock bonuses.

Shares Subject to the Incentive Plan

The shares subject to issuance under the Incentive Plan consist of
authorized but unissued shares of common stock.

If any option granted pursuant to the Incentive Plan expires or
terminates for any reason without being exercised in whole or in part, or
any award granted thereunder terminates without shares being issued, the
shares released from such award will again become available for grant and
purchase under the Incentive Plan. In the event that shares issued pursuant
to awards granted under the Incentive Plan are repurchased at the original
issue price, such shares will also again become available for grant and
purchase under the Incentive Plan. The number of shares is subject to
proportional adjustment to reflect stock splits, stock dividends and other
similar events.

Eligibility

Employees, officers, directors, consultants, independent contractors
and advisors of the Company and of any parent or subsidiary of the Company
(the "Participants") are eligible to receive awards under the Incentive
Plan. No Participant is eligible to receive more than 750,000 shares of
common stock under the Incentive Plan in any calendar year, other than new
employees of the Company (including directors and officers who are also new
employees) who are eligible to receive up to a maximum of 1,500,000 shares
of common stock in the calendar year in which they commence their
employment with the Company. The closing price of common stock on the NASD
OTC BB was approximately $.14 per share on October 30, the last trading day
before the Record Date.

Administration

The Incentive Plan will be administered by Gilbert Fuentes, Chief
Financial Officer and Treasurer, until the Company establishes a
Compensation Committee. The Compensation Committee will be comprised of a
"non-employee director" within the meaning of Rule 16b-3 promulgated under
the Exchange Act, and an "outside director" within the meaning of Section
162(m) of the Internal Revenue Code of 1986 (the "Code").

Subject to the terms of the Incentive Plan, Mr. Fuentes and/or the
Compensation Committee determines the persons who are to receive awards,
the number of shares subject to each such award and the terms and
conditions of such awards. The Committee also has the authority to construe
and interpret any of the provisions of the Incentive Plan or any awards
granted thereunder.

<PAGE>
Stock Options

The Incentive Plan permits the granting of options that are intended
to qualify either as Incentive Stock Options ("ISOs") or Nonqualified Stock
Options ("NQSOs"). ISOs may be granted only to employees (including
officers and directors who are also employees) of the Company or any parent
or subsidiary of the Company. Options typically vest over a 36-month period
while the Participant provides services to the Company or any of its
subsidiaries. It is the Company's general policy to suspend the vesting
beginning on the 31st day of an employee's leave of absence.

The option exercise price for each ISO share must be no less than 100%
of the "fair market value" (as defined in the Incentive Plan) of a share of
common stock at the time the ISO is granted. In the case of an ISO granted
to a 10% stockholder, the exercise price for each such ISO share must be no
less than 110% of the fair market value of a share at the time the ISO is
granted. The option exercise price for each NQSO must be no less than 85%
of the fair market value of a share of common stock at the time of grant.

The exercise price of options granted under the Incentive Plan may be
paid as approved by the Committee: (1) in cash; (2) by cancellation of
indebtedness of the Company to the Participant; (3) by surrender of shares
of the Company's common stock obtained by Participant in the public market
or owned by the Participant for at least six months and having a fair
market value on the date of surrender equal to the aggregate exercise price
of the option; (4) by tender of a full recourse promissory note; (5) by
waiver of compensation due to or accrued by the Participant for services
rendered; (6) by a "same-day sale" commitment from the Participant and a
National Association of Securities Dealers, Inc. ("NASD") broker; (7) by a
"margin" commitment from the Participant and a NASD broker; or (8) by any
combination of the foregoing.

Restricted Stock Awards

The Committee may grant Participants awards to purchase shares of
restricted stock under the Incentive Plan under such terms, conditions and
restrictions as the Committee may determine. A restricted stock award is an
offer by the Company to sell to a Participant shares of common stock that
are subject to restrictions established by Mr. Fuentes and/or the
Compensation Committee. These restrictions may be based upon completion by
the Participant of a specified number of years of service or by the
attainment of certain performance goals established by Mr. Fuentes and/or
the Committee, for example. The purchase price for each such award is
determined by the Committee at the time of grant and may be less than the
fair market value of common stock on the date of the award. In the case of
an award to a 10% stockholder, the purchase price will be at least 100% of
fair market value. The purchase price may be paid for in any of the forms
of consideration listed in items (1) through (5) in "Stock Options" above,
as approved by Mr. Fuentes and/or the Committee.

Stock Bonus Awards

The Company may grant Participants stock bonus awards under the
Incentive Plan on such terms, conditions and restrictions as the Company
may determine. A stock bonus is an award of shares for services rendered.
Stock bonuses may be awarded for past services already rendered or upon
satisfaction of performance goals that are set out in advance in the
Participant's stock bonus award agreement.

<PAGE>
Mergers, Consolidations, Change of Control

In the event of a merger, consolidation, dissolution or liquidation of
the Company, the sale of substantially all of its assets, or any other
similar corporate transaction, the successor corporation may assume,
replace or substitute equivalent awards in exchange for those granted under
the Incentive Plan or provide substantially similar consideration, shares
or other property as was provided to stockholders of the Company (after
taking into account provisions of the awards). In the event that the
successor corporation does not assume, replace or substitute the options
awarded, such options will expire upon the closing of such transaction at
the time and upon the conditions as the Committee determines. The Committee
may, in its sole discretion, provide that the vesting of any or all awards
granted pursuant to the Incentive Plan will accelerate in whole or in part.

Amendment of the Incentive Plan

The Board may, at any time, terminate or amend the Incentive Plan,
including amending any form of award agreement or instrument to be executed
pursuant to the Incentive Plan. The Board will not amend the Incentive Plan
in any manner that requires stockholder approval, without obtaining that
approval.

Term of the Incentive Plan

Unless terminated earlier as provided in the Incentive Plan, the
Incentive Plan will expire on December 1, 2010, ten years from the date it
was adopted by the Board of Directors.

Federal Income Tax Information

The following is a general summary, as of the date of this proxy
statement, of the federal income tax consequences to the Company and
Participants under the Incentive Plan. The federal income tax laws may
change and the federal, state and local tax consequences for any
Participant will depend upon his or her individual circumstances. Any tax
effects that accrue to foreign Participants as a result of participating in
the Incentive Plan are governed by the tax laws of the countries in which
such participant resides. Each Participant is encouraged to seek the advice
of a qualified tax advisor regarding the tax consequences if participation
in the Incentive Plan.

Incentive Stock Options. A Participant will recognize no income upon
grant of an ISO and incur no tax on its exercise, unless the Participant is
subject to the alternative minimum tax ("AMT"). If the Participant holds
shares acquired upon exercise of an ISO (the "ISO Shares") for more than
one year after the date the option was exercised and for more than two
years after the date the option was granted, the Participant generally will
realize capital gain or loss (rather than ordinary income or loss) upon
disposition of the ISO Shares. This gain or loss will be equal to the
difference between the amount realized upon such disposition and the amount
paid for the ISO Shares. The rate of taxation that applies to capital gain
depends upon the amount of time the ISO Shares are held by the Participant.

If the Participant disposes of ISO Shares prior to the expiration of
either required holding period (a "disqualifying disposition"), the gain
realized upon such disposition, up to the difference between the fair
market value of the ISO Shares on the date of exercise (or, if less, the
amount realized on a sale of such shares) and the option exercise price,
will be treated as ordinary income. Any additional gain will be capital
gain, taxed at a rate that depends upon the amount of time the ISO Shares
were held by the Participant.

Alternative Minimum Tax. The difference between the option exercise
price and the fair market value of the ISO Shares that are vested on the
date of exercise is an adjustment to income for purposes of the AMT. The
AMT (imposed to the extent it exceeds the taxpayer's regular income tax) is
26% of an individual taxpayer's alternative minimum taxable income (28% in
the case of alternative minimum taxable income in excess of $175,000).
Alternative minimum taxable income is determined by adjusting regular
taxable income for certain items, increasing that income by certain tax
preference items (including the difference between the fair market value of
the ISO Shares on the date of exercise and the exercise price) and reducing
this amount by the applicable exemption amount ($45,000 in case of a joint
return, subject to reduction under certain circumstances). If a
disqualifying disposition of the ISO Shares occurs in the same calendar
year as exercise of the ISO, there is no AMT adjustment with respect to
those ISO Shares. Also, upon a sale of ISO Shares that is not a
disqualifying disposition, alternative minimum taxable income is reduced in
the year of sale by the excess of the fair market value of the ISO Shares
at exercise over the amount paid for the ISO Shares.

Nonqualified Stock Options. A Participant will not recognize any
taxable income at the time an NQSO is granted. However, upon exercise of an
NQSO for vested shares, the Participant must include in income as
compensation an amount equal to the difference between the fair market
value of the shares on the date of exercise and the Participant's exercise
price. The included amount must be treated as ordinary income by the
Participant and may be subject to withholding by the Company (either by
payment in cash or withholding out of the Participant's salary). Upon
resale of the shares by the Participant, any subsequent appreciation or
depreciation in the value of the shares will be treated as capital gain or
loss, taxable at a rate that depends upon the length of time the shares
were held by the Participant.

Restricted Stock and Stock Bonus Awards. A Participant who receives a
restricted stock award or a stock bonus award will include the amount of
the award in income as compensation at the time that any forfeiture
restrictions on the shares of stock lapse, unless the Participant makes a
timely election under Code Section 83(b). If the Participant does not
timely make an 83(b) election, the Participant will include in income the
fair market value of the shares of stock on the date that the restrictions
lapse as to those shares, less any purchase price paid for such shares. The
included amount may be treated as ordinary income by the Participant and
will be subject to withholding by the Company (either by payment in cash or
withholding out of the Participant's award).

If the Participant makes a timely 83(b) election, the Participant who
receives a restricted stock award will include in income, as ordinary
income, the fair market value of the shares of stock on the date of receipt
of the award less any purchase price paid for such shares, and the
Participant who receives a stock bonus will include in income, as ordinary
income, the fair market value of the shares of stock on the date of receipt
of the award. The income may be subject to withholding by the Company
(either by payment in cash or withholding out of the Participant's award).
If the award is subsequently forfeited, the Participant will not receive
any deduction for the amount treated as ordinary income.

Maximum Tax Rates. The maximum tax rate applicable to ordinary income
is 39.6%. Long-term capital gain will be taxed at a maximum of 20%. In
order to receive long-term capital gain treatment, the shares acquired
pursuant to the Incentive Plan must be held for more than 12 months.
Capital gains may be offset by capital losses and up to $3,000 of capital
losses may be offset annually against ordinary income.

Tax Treatment of the Company. The Company generally will be entitled
to a deduction in connection with the exercise of an NQSO by a Participant
or the receipt by the Participant of restricted stock or a stock bonus to
the extent that the Participant recognizes ordinary income and the Company
properly reports such income to the Internal Revenue Service (the "IRS").
The Company will be entitled to a deduction in connection with the
disposition of ISO Shares only to the extent that the Participant

<PAGE>
recognizes ordinary income on a disqualifying disposition of the ISO
Shares, provided that the Company properly reports such income to the IRS.

ERISA

The Incentive Plan is not subject to any of the provisions of the
Employee Retirement Income Security Act of 1974 ("ERISA") and is not
qualified under Section 401(a) of the Code.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE APPROVAL OF THE
COMPANY'S 2000 EQUITY INCENTIVE PLAN.

PROPOSAL NO. 4

OTHER MATTERS

Management does not intend to present any business at the meeting not
mentioned in this Proxy Statement, and currently knows of no other business
to be presented. If any other matters are brought before the meeting, the
appointed proxies will vote all Proxies on such matters in accordance with
their judgment of the best interests of the Company.

SUPPLEMENTAL INFORMATION WITH RESPECT TO THE COMPANY

Certain information about the current executive officers of the
Company is set forth below. Each executive officer of the Company may be
removed from office at any time by a majority of the Company's Board of
Directors with or without cause.

<TABLE>
<CAPTION>
POSITIONS HELD
NAME AGE WITH THE COMPANY SINCE
---- --- ---------------- -----
<S> <C> <C> <C>
Michael A. Sunstein 58 Director, Chief Executive Officer & 1989
President

Gilbert Fuentes 67 Chief Financial Officer & Treasurer 1996

Paul G. Goss (1) 58 V.P. Legal Counsel, U.S. 1996

Bersain Gutierrez 43 V.P. Legal Counsel, Mexico 1998

Dr. Jerry Parker 63 Director and 1996
V.P. Medical Development

Jason Sunstein 29 Secretary and 1989
Senior Vice President

Robert Margolis 63 V.P. Finance 2000
</TABLE>

(1) Mr. Goss provides services to the Company as requested.

<PAGE>
MICHAEL A. SUNSTEIN. Mr. Sunstein has been the Chief Executive Officer and
a Director of the Company since its founding 1989. Prior to joining the
Company, Mr. Sunstein spent 15 years in the housing industry, primarily
with Kaufman and Broad Homes, Inc., a New York Stock Exchange listed
company, where he served as President of the Midwestern Division and acting
President of the East Coast Division. In those capacities he was
responsible for the financial, building and delivery of approximately
$30,000,000 in housing sales annually. He resigned from Kaufman and Broad
and started his own firm in the building and materials and single-family
home industry in Michigan, prior to moving to San Diego in 1982.

PAUL G. GOSS. Mr. Goss has been a Vice President and General Counsel to
the Company since September of 1996. Mr. Goss has been the Executive Vice
President and General Counsel for One Capital Corporation, a private
merchant bank with offices in New York and Denver since 1990. Prior to
joining One Capital Corporation, Mr. Goss was engaged in the private
practice of law in Denver, Colorado with a concentration in real estate,
corporate and securities law. He is a member of the Denver and Colorado
Bar Associations. Mr. Goss has a Masters in Business Administration in
addition to his law degree from the University of Denver.

LIC. BERSAIN GUTIERREZ. Mr. Gutierrez joined the Company in October of
1998 as V.P. Legal Counsel, Mexico and Director of Mexican Operations. He
has been instrumental in negotiating, coordinating title policies, surveys
and the filing and approval for Municipal zoning and permits for the
Company's real estate projects in Mexico. Prior to joining the Company,
Mr. Gutierrez held high positions in the Secretaria de Hacienda y Credito
Publico (I.R.S. of Mexico), as well as District Attorney for the Federal
District of Mexico City. He also held high positions in the Procudaria de
Justicia del D.F. (the F.B.I. of Mexico). Mr. Gutierrez graduated with
honors from the law school of Universidad Autonoma de Mexico in 1979.

DR. JACOB J. PARKER. Dr. Parker has been a Director and V.P. Medical
Development of the Company since 1996. Dr. Parker is currently Medical
Director and Director of Radiology for several MRI centers and breast
imaging centers in Northern California since 1973. He was previously Chief
of Radiology and Nuclear Medicine at Ross General Hospital, Clinical
Professor of Radiology at the University of California, Irvine, and
Instructor of Radiology at the University of Southern California Medical
Center from 1970 to 1988. Dr. Parker received his M.D. from the University
of Manitoba, Canada in 1962.

JASON A. SUNSTEIN. Mr. Sunstein is Senior Vice President and Secretary and
has been with the Company in various capacities since 1989. He has been
instrumental in all aspects of sales, acquisition and development,
financing and long-term planning for the Company and its subsidiaries. Mr.
Sunstein attended San Diego State University where he majored in Finance
and was a licensed securities broker. He is the son of Michael Sunstein.

<PAGE>
ROBERT MARGOLIS. Mr. Margolis has been V.P. Finance for the Company since
early 2000. He has been engaged in the financial services industry for
approximately 30 years. He brings a diverse financing and real estate
lending background, having been the former President of Mortgage Bankers
Acceptance Company, President of Western Empire Savings and Loan
Association, Senior V.P. and Chief Loan Officer of Columbia Savings and
Loan, Senior V.P. of Major and Construction Loan Department for Farwest
Savings and Loan. His career has encompassed working with highly
successfully individuals and achievement-oriented companies on a national
level. During his career Mr. Margolis has been intrically involved in the
financing of over $2 billion of construction and existing residential,
commercial and industrial real estate throughout the United States.

Jason A. Sunstein is the son of Michael A. Sunstein. There are no
other family relationships between the proposed executive officers or
directors. The Company's address is: 480 Camino Del Rio South, Suite 140,
San Diego, California 92108.

The Company has assembled a team of advisors to consult the Company
from time to time on various business matters. The following are key
members of the advisory team:

DOUGLAS MORGAN. Mr. Morgan joined the Company in 1989 as a shareholder and
in September of 1998 as a consultant for internet marketing, web design and
computer software, hardware and networking. Mr. Morgan is a Magna Cum
Laude graduate from both Massachusetts Institute of Technology with a
Bachelors Degree and Stanford University with a Masters Degree, both in
Computer Science and Electrical Engineering. He has over 25 years of
experience in the computer industry with an early background in
programming, design and project management with companies such as Computer
Sciences Corp., Hughes, NCR and Hewlett Packard.

DANIEL LOMAX. Mr. Lomax has been involved with the Company in various
capacities since 1990 and most recently as President of Solymar, the
construction company contracted to build the Company's assisted living
facilities. Mr. Lomax entered the general contracting and development
business in the State of California in 1960 with single-family homes,
remodeling, commercial projects and major shopping center tenant
improvements. In 1975, Mr. Lomax received his BI heavy construction
license from the State of Arizona and started designing, building and
financing single-family town homes, single-family lot homes and
condominiums, exceeding 1,500 units.

LOUIS LESSER. Mr. Lesser has been a consultant to the Company since 1991
on financing and real estate transactions. Mr. Lesser has successfully
built, owned and operated numerous real estate companies, hotel properties
and oil and gas companies since 1935, including Chairman and President of
Louis Lesser Enterprises, Inc. of Beverly Hills, CA, which was listed on
the American Stock Exchange. Louis Lesser Enterprises built developed and
operated over $1,000,000,000 of commercial and residential real estate
properties and over $500,000,000 of housing projects for the Army, Navy,
Air Force and Marine Corps. all over the U.S.

DAVID SONNENBLICK. Mr. Sonnenblick has been a consultant to the Company
since 1996 on financing, real estate transactions and mergers and
acquisitions. Mr. Sonnenblick is currently the Managing Director of the
Los Angeles office for Sonnenblick Eichner, a national investment banking
firm, headquartered in New York. Mr. Sonnenblick has successfully closed
transactions valued in excess of $1,000,000,000 on behalf of his clients.
Mr. Sonnenblick attended the University of Denver where he was an honors
student and completed his studies at the University of Colorado where he
received a B.A. in Economics in 1982.

<PAGE>
NORM EDWARDS. Mr. Edwards has been a consultant to the Company since 1999
on administration, financing and mergers and acquisitions. Mr. Edwards has
consulted with various companies for the past 26 years in areas of
corporate development. Mr. Edwards obtained his Bachelors of Science
degree in Business Administration from the California State Polytechnic
College in Pomona, California in 1961. Mr. Edwards is a retired USAF Lt.
Colonel, Command Pilot.

CRAIG LANSER. Mr. Lanser has been a consultant to the Company since April
of 2000 on financing, construction and acquisition and development of our
Senior Retirement Communities in Arizona, Nevada and California for Alpine
Gardens East (AGE). Mr. Lanser received his Bachelor of Science Degree in
Business Administration from San Diego State University Majoring in Real
Estate with a minor in Geography. He has held a California State Real
Estate Broker's License since 1978. Mr. Lanser has been involved in the
leasing, sales, marketing and development of shopping centers, apartment
complexes, office-medical and industrial properties since 1987.

During the fiscal years ended April 30, 1997, 1998, and 1999, the
Company granted options to certain officers as compensation for their
services pursuant to the Company's Stock Option Plan. No options were
granted to any of the directors or officers of the Company for year ending
April 30, 2000. Future option grants to all of the Company's officers and
directors are being held pending the approval of the 2000 Equity Incentive
Plan. Total compensation paid to officers of the Company for its past
three fiscal years is set forth below:

<PAGE>
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
Long Term Compensation
-------------------------------
Annual Compensation Awards Payouts
--------------------------------------------------------------
Other Securities
Annual Restricted Under- All Other
Name and Compen- Stock lying LTIP Compen-
Principal sation Award(s) Options Payouts sation
Position Year Salary($) Bonus($) ($) ($) (#) ($) ($)

---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Michael A. 1998 $120,000 $ 0 $ 0 $ 0 450,000 $ 0 $ 0
Sunstein 1999 $144,000 $ 0 $ 0 $ 0 350,000 $ 0 $ 0
CEO & 2000 $144,000 $ 0 $ 0 $ 0 0 $ 0 $ 0
President

Gilbert 1998 $ 60,000 $ 0 $ 0 $ 0 150,000 $ 0 $ 0
Fuentes, 1999 $ 72,000 $ 0 $ 0 $ 0 125,000 $ 0 $ 0
CFO & 2000 $ 72,000 $ 0 $ 0 $ 0 0 $ 0 $ 0
Treasurer

Paul G. 1998 $ 0 $ 0 $ 0 $66,000 0 $ 0 $ 0
Goss, V.P. 1999 $ 30,000 $ 0 $ 0 $68,250 100,000 $ 0 $ 0
& U.S. 2000 $ 50,000 $ 0 $ 0 0 $ 0 $ 0
Counsel

Jason A. 1998 $ 60,000 $ 0 $ 0 $ 0 150,000 $ 0 $ 0
Sunstein, 1999 $ 72,000 $ 0 $ 0 $ 0 125,000 $ 0 $ 0
Secretary 2000 $ 72,000 $ 0 $ 0 $ 0 0 $ 0 $ 0
& V.P.

Bersain 2000 $ 0 $ 0 $ 0 $ 0 0 $ 0 $ 0
Gutierrez,
V.P. &
Mexico
Counsel(1)

Jerry J. 1998 $ 0 $ 0 $ 0 $ 0 0 $ 0 $ 0
Parker, 1999 $ 0 $ 0 $ 0 $ 0 50,000 $ 0 $ 0
M.D., V.P. 2000 $ 0 $ 0 $ 0 $ 0 0 $ 0 $ 0

Robert 2000 $ 10,000 $ 0 $ 0 $ 0 0 $ 0 $ 0
Margolis,
V.P.
</TABLE>

(1) Bersain Gutierrez has only recently been retained as V.P. Legal
Counsel, Mexico for the Company, and did not receive compensation from the
Company in it's most recent fiscal year.

(2) All options issued in 1997, 1998 and 1999 not exercised by
December 31, 1999, expired in accordance with the Company's Stock Option Plan.

<PAGE>
SHAREHOLDER PROPOSALS

Proposals of shareholders of the Company which are intended to be
presented by such shareholders at the Company's next Annual Meeting of
Shareholders must be received by the Company no later than December 18,
2000 in order to be considered for inclusion in the Company's proxy
statement and form of proxy relating to that meeting.

Jason A. Sunstein,
Secretary

Dated: December 18, 2000

<PAGE>
APPENDIX A

TRI-NATIONAL DEVELOPMENT CORP.
2000 EQUITY INCENTIVE PLAN

1. DEFINITIONS.

(a) "Affiliate" means (i) a member of a controlled group of
corporations of which the Company is a member or (ii) an
unincorporated trade or business which is under common control
with the Company as determined in accordance with Section 414(c)
of the Code and the regulations issued thereunder. For purposes
hereof, a "controlled group of corporations" shall mean a
controlled group of corporations as defined in Section 1563(a) of
the Code determined without regard to Section 1563(a)(4) and
(e)(3)(C).

(b) "Alternate Option Payment Mechanism" refers to one of several
methods available to a Participant to fund the exercise of a
stock option set out in Section 11 hereof. These mechanisms
include: broker assisted cashless exercise and stock for stock
exchange.

(c) "Award" means a grant of one or some combination of one or more
Non-statutory Stock Options, Incentive Stock Options and Stock
Awards under the provisions of this Plan.

(d) "Board of Directors" or "Board" means the board of directors of
the Company and Directors Emeritus of the Company.

(e) "Change in Control" means a change in control of the Company of
a nature that; (i) would be required to be reported in response
to Item 1 of the current report on Form 8-K, as in effect on the
date hereof, pursuant to Section 13 or 15(d) of the Exchange Act;
or (ii) without limitation such a Change in Control shall be
deemed to have occurred at such time as (A) any "person" (as the
term is used in Sections 13(d) and 14(d) of the Exchange Act) is
or becomes the "beneficial owner" (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of securities of the
Company representing 20% or more of the Company's outstanding
securities; or (B) individuals who constitute the Board of
Directors of the Company on the date hereof (the "Incumbent
Board") cease for any reason to constitute at least a majority
thereof, provided that any person becoming a director subsequent
to the date hereof whose election was approved by a vote of at
least three-quarters of the directors comprising the Incumbent
Board, or whose nomination for election by the Company's
stockholders was approved by a Nominating Committee serving under
an Incumbent Board, shall be, for purposes of this clause (B),
considered as though he were a member of the Incumbent Board; or
(C) a plan of reorganization, merger, consolidation, sale of all
or substantially all the assets of the Company or similar
transaction occurs in which the Company is not the resulting
entity; or (D) after a solicitation of shareholders of the
Company, by someone other than current management of the Company,
stockholders approve a plan of reorganization, merger or
consolidation of the Company or similar transaction with one or
more corporations, as a result of which the outstanding shares of
the class of securities then subject to the plan would be
exchanged for or converted into cash or property or securities
not issued by the Company; or (E) a tender offer is made for 20%
or more of the voting securities of the Company.

(f) "Code" means the Internal Revenue Code of 1986, as amended.

<PAGE>
(g) "Committee" means a committee consisting of the entire Board of
Directors or consisting solely of two or more members of the
Board of Directors who are defined as Non-Employee Directors as
such term is defined under Rule 16b-3(b)(3)(i) under the Exchange
Act as promulgated by the Securities and Exchange Commission.

(h) "Common Stock" means the Common Stock of the Company, no par
value, or any stock exchanged for shares of Common Stock pursuant
to Section 15 hereof.

(i) "Company" means Tri-National Development Corporation.

(j) "Date of Grant" means the effective date of an Award.

(k) "Disability" means the permanent and total inability by reason of
mental or physical infirmity, or both, of a Participant to
perform the work customarily assigned to him or, in the case of
a Director, to serve on the Board. Additionally, a medical doctor
selected or approved by the Board of Directors must advise the
Committee that it is either not possible to determine when such
Disability will terminate or that it appears probable that such
Disability will be permanent during the remainder of said
Participant's lifetime.

(l) "Effective Date" means December 29, 2000, the effective date of
the Plan.

(m) "Employee" means any person who is currently employed by the
Company or an Affiliate, including officers, but such term shall
not include Outside Directors.

(n) "Employee Participant" means an Employee who holds an outstanding
Award under the terms of the Plan.

(o) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

(p) "Exercise Price" means the purchase price per share of Common
Stock deliverable upon the exercise of each Option in order for
the option to be exchanged for shares of Common Stock.

(q) "Fair Market Value" means, with respect to any Non-Qualified
Stock Options granted hereunder, as of any given date, at the
discretion of the Committee and subject to such limitations as
the Committee may impose, (1) the Closing Price of the Stock, (2)
the fair market value of the Stock as determined in accordance
with a method prescribed in the agreement evidencing any award
hereunder, or (3) the fair market value of the Stock as otherwise
determined by the Committee in the good faith exercise of its
discretion.

(r) "Incentive Stock Option" means an Option granted by the Committee
to a Participant, which Option is designated by the Committee as
an Incentive Stock Option pursuant to Section 7 hereof and is
intended to be such under Section 422 of the Code.

(s) "Limited Right" means the right to receive an amount of cash
based upon the terms set forth in Section 8 hereof.

(t) "Non-statutory Stock Option" means an Option to a Participant
pursuant to Section 6 hereof, which is not designated by the
Committee as an Incentive Stock Option or which is redesignated
by the Committee as a Non-statutory Stock Option or which is
designated

2
<PAGE>
an Incentive Stock Option under Section 7 hereof, but does not
meet the requirements of such under Section 422 of the Code.

(u) "Option" means the right to buy a fixed amount of Common Stock at
the Exercise Price within a limited period of time designated as
the term of the option as granted under Section 6 or 7 hereof.

(v) "Outside Director" means a member of the Board of Directors or a
Director Emeritus of the Company or its Affiliates, who is not
also an Employee.

(w) "Outside Director Participant" means an Outside Director who
holds an outstanding Award under the terms of the Plan.

(x) "Participant(s)" means collectively an Employee Participant
and/or an Outside Director Participant who hold(s) outstanding
Awards under the terms of the Plan.

(y) "Retirement" with respect to an Employee Participant means
termination of employment which constitutes retirement under any
tax qualified plan. However, "Retirement" will not be deemed to
have occurred for purposes of this Plan if a Participant
continues to serve as a consultant to or on the Board of
Directors of the Company or its Affiliates even if such
Participant is receiving retirement benefits under any retirement
plan of the Company or its Affiliates. With respect to an Outside
Director Participant, "Retirement" means the termination of
service from the Board of Directors of the Company or its
Affiliates following written notice to the Board as a whole of
such Outside Director's intention to retire, except that an
Outside Director Participant shall not be deemed to have
"retired" for purposes of the Plan in the event he continues to
serve as a consultant to the Board or as an advisory director or
director emeritus, including pursuant to any retirement plan of
the Company.

(z) "Stock Awards" are Awards of Common Stock which may vest
immediately or over a period of time. Vesting of Stock Awards
under Section 9 hereof may be contingent upon the occurrence of
specified events or the attainment of specified performance goals
as determined by the Committee.

(aa) "Termination for Cause" shall mean, in the case of a Director,
removal from the Board of Directors, or, in the case of an
Employee, termination of employment, in both such cases as
determined by the Board of Directors, because of Participant's
personal dishonesty, incompetence, willful misconduct, any breach
of fiduciary duty involving personal profit, intentional failure
to perform stated duties, willful violation of any law, rule or
regulation (other than traffic violations or similar offenses).

(bb) "Trust" means a trust established by the Board in connection with
this Plan to hold Plan assets for the purposes set forth herein.

(cc) "Trustee" means that person or persons and entity or entities
approved by the Board to hold legal title to any of the Trust
assets for the purposes set forth herein.

2. ADMINISTRATION.

(a) The Plan shall be administered by Gilbert Fuentes until a
Compensation Committee has been established. The Mr. Fuentes, the
Company's Chief Financial Officer and Treasurer,

3
<PAGE>
and/or the Compensation Committee are authorized, subject to the
provisions of the Plan, to grant awards to Employees and
establish such rules and regulations as it deems necessary for
the proper administration of the Plan and to make whatever
determinations and interpretations in connection with the Plan
it deems necessary or advisable. All determinations and
interpretations made by Mr. Fuentes and/or the Compensation
Committee shall be binding and conclusive on all Employee
Participants and Outside Director Participants in the Plan and on
their legal representatives and beneficiaries.

(b) Awards to Outside Directors of the Company or its Affiliates
shall be granted by the Board of Directors or the Committee,
pursuant to the terms of this Plan.

3. TYPES OF AWARDS AND RELATED RIGHTS.

The following Awards and related rights as described below in
Paragraphs 6 through 9 hereof may be granted under the Plan:

(a) Non-statutory Stock Options
(b) Incentive Stock Options
(c) Limited Right
(d) Stock Awards

4. STOCK SUBJECT TO THE PLAN.

Subject to adjustment as provided in Section 15 hereof, the maximum
number of shares of Common Stock reserved for Awards under the Plan is
1,500,000 shares which number may not be in excess of 30% of the
outstanding shares of the Common Stock determined immediately as of the
Effective Date. These shares of Common Stock may be either authorized but
unissued shares or authorized shares previously issued and reacquired by
the Company or acquired by the Trustee. To the extent that Options and
Stock Awards are granted under the Plan, the shares underlying such Awards
will be unavailable for any other use including future grants under the
Plan except that, to the extent that Stock Awards or Options terminate,
expire, or are forfeited without having been exercised (or in cases where
a Limited Right has been granted in connection with an option, the amount
of such Limited Right received in lieu of the exercise of such option), new
Awards may be made with respect to those shares underlying such terminated,
expired or forfeited Options or Stock Awards.

5. ELIGIBILITY.

Subject to the terms herein, all Employees, Directors, advisors and
consultants of the Company or any of its subsidiaries shall be eligible to
receive Awards under the Plan.

6. NON-STATUTORY STOCK OPTIONS.

The Company may, subject to the limitations of the Plan and the
availability of shares reserved but unawarded under the Plan, from time to
time, grant Non-statutory Stock Options to Employees, Directors, advisors
and consultants upon such terms and conditions as the Company may determine
and grant Non-statutory Stock Options in exchange for and upon surrender of
previously granted Awards under this Plan under such terms and conditions
as the Committee may determine. Non-statutory Stock Options granted under
this Plan are subject to the following terms and conditions:

4
<PAGE>
(a) Exercise Price. The Exercise Price of each Non-statutory Stock
Option shall be determined by the Company. Such Exercise Price
shall not be less than 100% of the Fair Market Value of the
Company's Common Stock on the Date of Grant. Shares of Common
Stock underlying a Non-statutory Stock Option may be purchased
only upon full payment of the Exercise Price or upon operation of
an Alternate Option Payment Mechanism set out in Section 11 hereof.

(b) Terms of Non-statutory Stock Options. The term during which each
Non-statutory Stock Option may be exercised shall be determined
by the Company, but in no event shall a Non-statutory Stock
Option be exercisable in whole or in part more than 10 years from
the Date of Grant. The Company shall determine the date on which
each Non-statutory Stock Option shall become exercisable. The
Company may also determine as of the Date of Grant any other
specific conditions or specific performance goals which must be
satisfied prior to the Non-statutory Stock Option becoming
exercisable. The shares of Common Stock underlying each
Non-statutory Stock Option installment may be purchased in whole
or in part by the Participant at any time during the term of such
Non-statutory Stock Option after such installment becomes
exercisable. The Company may, in its sole discretion, accelerate
the time at which any Non-statutory Stock Option may be exercised
in whole or in part, subject to applicable rules and regulations.
The acceleration of any Non-statutory Stock Option under the
authority of this paragraph shall create no right, expectation or
reliance on the part of any other Participant or that certain
Participant regarding any other unaccelerated Non-statutory Stock
Options. Unless determined otherwise by the Company and except in
the event of the Participant's death or pursuant to a domestic
relations order, a Non-statutory Stock Option is not transferable
and may be exercisable in his lifetime only by the Participant to
whom it is granted. Upon the death of a Participant, a
Non-statutory Stock Option is transferable by will or the laws of
descent and distribution.

(c) NSO Agreement. The terms and conditions of any Non-statutory
Stock Option granted shall be evidenced by an agreement (the "NSO
Agreement") which shall be subject to the terms and conditions of
the Plan.

(d) Termination of Employment or Service. Unless otherwise determined
by the Company, upon the termination of a Participant's
employment or service for any reason other than Disability,
death or Termination for Cause, the Participant's Non-statutory
Stock Options shall be exercisable only as to those shares that
were immediately exercisable by the Participant at the date of
termination and only for a period of three months following
termination; provided that in the event of termination of a
Participant's employment or service due to Retirement, the
Participant shall have up to one year following the
Participant's cessation of employment or service to exercise
the Participant's immediately exercisable Non-statutory Options.
Notwithstanding any provisions set forth herein or contained in
any NSO Agreement relating to an award of a Non-statutory Stock
Option, in the event of termination of the Participant's
employment or service for Disability or death, all Non-statutory
Stock Options held by such Participant shall immediately vest and
be exercisable for one year after such termination of service,
and, in the event of a Termination for Cause, all rights under
the Participant's Non-statutory Stock Options shall expire
immediately upon such Termination for Cause. Notwithstanding the
above, in no event shall any Non-statutory Stock Options be
exercisable beyond the expiration of the Non-Statutory Stock
Option term.

5
<PAGE>
7. INCENTIVE STOCK OPTIONS.

The Company may, subject to the limitations of the Plan and the
availability of shares reserved but unawarded under the Plan, from time to
time, grant Incentive Stock Options to Employees upon such terms and
conditions as the Company may determine. Incentive Stock Options granted
pursuant to the Plan shall be subject to the following terms and conditions:

(a) Exercise Price. The Exercise Price of each Incentive Stock Option
shall be not less than 100% of the Fair Market Value of the
Common Stock on the Date of Grant. However, if at the time an
Incentive Stock Option is granted to an Employee Participant,
such Employee Participant owns Common Stock representing more
than 10% of the total combined voting securities of the Company
(or, under Section 424(d) of the Code, is deemed to own Common
Stock representing more than 10% of the total combined voting
power of all classes of stock of the Company, by reason of the
ownership of such classes of stock, directly or indirectly, by or
for any brother, sister, spouse, ancestor or lineal descendent of
such Employee Participant, or by or for any corporation,
partnership, estate or trust of which such Employee Participant
is a shareholder, partner or beneficiary) ("10% Owner"), the
Exercise Price per share of Common Stock deliverable upon the
exercise of each Incentive Stock Option shall not be less than
110% of the Fair Market Value of the Common Stock on the Date of
Grant. Shares may be purchased only upon payment of the full
Exercise Price or upon operation of an Alternate Option Payment
Mechanism set out in Section 11 hereof.

(b) Amounts of Incentive Stock Options. Incentive Stock Options may
be granted to any Employee in such amounts as determined by the
Company; provided that the amount granted is consistent with the
terms of Section 422 of the Code. In the case of an Option
intended to qualify as an Incentive Stock Option, the aggregate
Fair Market Value (determined as of the time the Option is
granted) of the Common Stock with respect to which Incentive
Stock Options granted are exercisable for the first time by the
Employee Participant during any calendar year (under all plans of
the Employee Participant's employer corporation and its parent
and subsidiary corporations) shall not exceed $100,000. The
provisions of this Section 7(b) shall be construed and applied in
accordance with Section 422(d) of the Code and the regulations,
if any, promulgated thereunder. To the extent an Award of an
Incentive Stock Option under this Section 7 exceeds this $100,000
limit, the portion of the Award in excess of such limit shall be
deemed a Non-statutory Stock Option. The Company shall have
discretion to redesignate Options granted as Incentive Stock
Options as Non-statutory Stock Options. Such Non-statutory Stock
Options shall be subject to Section 6 hereof.

(c) Terms of Incentive Stock Options. The term during which each
Incentive Stock Option may be exercised shall be determined by
the Committee, but in no event shall an Incentive Stock Option be
exercisable in whole or in part more than 10 years from the Date
of Grant. If, at the time of grant, an Incentive Stock Option is
granted to an Employee Participant who is a 10% Owner, the
Incentive Stock Option granted to such Employee Participant shall
not be exercisable after the expiration of five years from the
Date of Grant. No Incentive Stock Option is transferable except
by will or the laws of descent and distribution and is
exercisable in his lifetime only by the Employee Participant to
whom it is granted. The designation of a beneficiary does not
constitute a transfer.

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The Company shall determine the date on which each Incentive
Stock Option shall become exercisable. The Company may also
determine as of the Date of Grant any other specific conditions
or specific performance goals which must be satisfied prior to
the Incentive Stock Option becoming exercisable. The shares
comprising each installment may be purchased in whole or in part
at any time during the term of such Incentive Stock Option after
such installment becomes exercisable. The Company may, in its
sole discretion, accelerate the time at which any Incentive Stock
Option may be exercised in whole or in part, subject to
applicable rules and regulations. The acceleration of any
Incentive Stock Option under the authority of this paragraph
shall not create a right, expectation or reliance on the part of
any other Participant or that certain Participant regarding any
other unaccelerated Incentive Stock Options.

(d) ISO Agreement. The terms and conditions of any Incentive Stock
Option granted shall be evidenced by an agreement (the "ISO
Agreement") which shall be subject to the terms and conditions of
the Plan.

(e) Termination of Employment. Unless otherwise determined by the
Company, upon the termination of an Employee Participant's
employment for any reason other than Disability, death or
Termination for Cause, the Employee Participant's Incentive Stock
Options shall be exercisable only as to those shares that were
immediately exercisable by the Participant at the date of
termination and only for a period of three months following
termination, except that in the event of the termination of an
Employee Participant's employment due to Retirement, the
Participant shall have up to one year following the Participant's
cessation of employment to exercise any Incentive Stock Options
exercisable on that date. Notwithstanding any provision set forth
herein or contained in any ISO Agreement relating to an award of
an Incentive Stock Option, in the event of termination of the
Employee Participant's employment for Disability or death, all
Incentive Stock Options held by such Employee Participant shall
immediately vest and be exercisable for one year after such
termination, and, in the event of Termination for Cause, all
rights under the Employee Participant's Incentive Stock Options
shall expire immediately upon termination. Notwithstanding
anything contained herein to the contrary, no Incentive Stock
Option shall be eligible for treatment as an Incentive Stock
Option in the event such Incentive Stock Option is exercised more
than three months following the date of a Participant's cessation
of employment. In no event shall an Incentive Stock Option be
exercisable beyond the expiration of the Incentive Stock Option term.

(f) Compliance with Code. The Incentive Stock Options granted under
this Section 7 are intended to qualify as "incentive stock
options" within the meaning of Section 422 of the Code, but the
Company makes no warranty as to the qualification of any Option
as an incentive stock option within the meaning of Section 422 of
the Code. All Options that do not so qualify shall be treated as
Non-statutory Stock Options.

8. LIMITED RIGHT.

Simultaneously with the grant of any Option to a Participant, the
Company may grant a Limited Right with respect to all or some of the shares
covered by such Option. Limited Rights granted under this Plan are subject
to the following terms and conditions:

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(a) Terms of Rights. In no event shall a Limited Right be exercisable
in whole or in part before the expiration of six months from the
Date of Grant of the Limited Right. A Limited Right may be
exercised only in the event of a Change in Control.

The Limited Right may be exercised only when the underlying
Option is eligible to be exercised, and only when the Fair Market
Value of the underlying shares on the day of exercise is greater
than the Exercise Price of the underlying Option.

Upon exercise of a Limited Right, the underlying Option shall
cease to be exercisable. Upon exercise or termination of an
Option, any related Limited Rights shall terminate. The Limited
Rights may be for no more than 100% of the difference between the
purchase price and the Fair Market Value of the Common Stock
subject to the underlying option. The Limited Right is
transferable only when the underlying option is transferable and
under the same conditions.

(b) Payment. Upon exercise of a Limited Right, the holder shall
promptly receive from the Company an amount of cash equal to the
difference between the Exercise Price of the underlying option
and the Fair Market Value of the Common Stock subject to the
underlying Option on the date the Limited Right is exercised,
multiplied by the number of shares with respect to which such
Limited Right is exercised. Payments shall be less any
applicable tax withholding as set forth in Section 16 hereof.

9. STOCK AWARD.

The Company may, subject to the limitations of the Plan, from time to
time, make an Award of shares of Common Stock to Employees and Directors
("Stock Awards"). The Stock Awards shall be made subject to the following
terms and conditions:

(a) Payment of the Stock Award. The Stock Award may only be made in
whole shares of Common Stock. Stock Awards may only be granted
from shares reserved under the Plan but unawarded at the time the
new Stock Award is made.

(b) Terms of the Stock Awards. The Company shall determine the dates
on which Stock Awards granted to a Participant shall vest and any
specific conditions or performance goals which must be satisfied
prior to the vesting of any installment or portion of the Stock
Award. Notwithstanding other paragraphs in this Section 9, the
Company may, in its sole discretion, accelerate the vesting of
any Stock Award. The acceleration of any Stock Award under the
authority of this paragraph shall create no right, expectation or
reliance on the part of any other Participant or that certain
Participant regarding any other unaccelerated Stock Awards.

(c) Stock Award Agreement. The terms and conditions of any Stock
Award shall be evidenced by an agreement (the "Stock Award
Agreement") which such Stock Award Agreement will be subject to
the terms and conditions of the Plan. Each Stock Award Agreement
shall set forth:

(i) the period over which the Stock Award will vest; and

(i) the performance goals, if any, which must be satisfied
prior to the vesting of any installment or portion of the
Stock Award. The performance goals may be

8
<PAGE>
set by the Committee on an individual level, for all
Participants, for all Awards made during a given period of
time, or for all Awards for indefinite periods;

(d) Certification of Attainment of the Performance Goal. No Stock
Award or portion thereof that is subject to a performance goal is
to be distributed to the Participant until the Committee
certifies that the underlying performance goal has been achieved.

(e) Termination of Employment or Service. Unless otherwise determined
by the Company, upon the termination of a Participant's
employment or service for any reason other than Disability,
death or Termination for Cause, the Participant's unvested Stock
Awards as of the date of termination shall be forfeited and any
rights the Participant had to such unvested Stock Awards shall
become null and void. Notwithstanding any provisions set forth
herein or contained in any Agreement relating to an award of a
Stock Option or Stock Award, in the event of termination of the
Participant's service due to Disability or death, all unvested
Stock Awards held by such Participant shall immediately vest and,
in the event of the Participant's Termination for Cause, the
Participant's unvested Stock Awards as of the date of such
termination shall be forfeited and any rights the Participant had
to such unvested Stock Awards shall become null and void.

(f) Non-Transferability. Except to the extent permitted by the Code,
the rules promulgated under Section 16(b) of the Exchange Act or
any successor statutes or rules:

(i) The recipient of a Stock Award shall not sell,
transfer, assign, pledge, or otherwise encumber shares
subject to the Stock Award until full vesting of such shares
has occurred. For purposes of this Section, the separation
of beneficial ownership and legal title through the use of
any "swap" transaction is deemed to be a prohibited
encumbrance.
(ii) Unless determined otherwise by the Company and except
in the event of the Participant's death or pursuant to a
domestic relations order, a Stock Award is not transferable
and may be earned in his lifetime only by the Participant to
whom it is granted. Upon the death of a Participant, a Stock
Award is transferable by will or the laws of descent and
distribution. The designation of a beneficiary does not
constitute a transfer.

(i) If a recipient of a Stock Award is subject to the
provisions of Section 16 of the Exchange Act, shares of
Common Stock subject to such Stock Award may not, without
the written consent of the Company (which consent may be
given in the Stock Award Agreement), be sold or otherwise
disposed of within six months following the date of grant of
the Stock Award.

(g) Accrual of Dividends. Whenever shares of Common Stock underlying
a Stock Award are distributed to a Participant or beneficiary
thereof under the Plan, such Participant or beneficiary shall
also be entitled to receive, with respect to each such share
distributed, a payment equal to any cash dividends or
distributions (other than distributions in shares of Common
Stock) and the number of shares of Common Stock equal to any
stock dividends, declared and paid with respect to a share of the
Common Stock if the record date for determining shareholders
entitled to receive such dividends falls between the date the
relevant Stock Award was granted and the date the relevant Stock
Award or installment thereof is issued. There shall also be
distributed an appropriate amount of net earnings, if any, of the
Trust with respect to any dividends paid out.

9
<PAGE>
(h) Voting of Stock Awards. After a Stock Award has been granted but
for which the shares covered by such Stock Award have not yet
been earned and distributed to the Participant pursuant to the
Plan, the Participant shall be entitled to direct the Trustee as
to the voting of such shares of Common Stock which the Stock
Award covers subject to the rules and procedures adopted by the
Committee for this purpose. All shares of Common Stock held by
the Trust as to which Participants are not entitled to direct, or
have not directed, the voting, shall be voted by the Trustee in
the same proportion as the Common Stock covered by Stock Awards
which have been awarded is voted.

10. PAYOUT ALTERNATIVES.

Payments due to a Participant upon the exercise or redemption of an
Award, may be made subject to the following terms and conditions:

(a) Discretion of the Committee. The Company has the sole discretion
to determine what form of payment (whether monetary, Common
Stock, a combination of payout alternatives or otherwise) it
shall use in making distributions of payments for all Awards. If
the Company requests any or all Participants to make an election
as to form of distribution or payment, it shall not be considered
bound by the election.

(b) Payment in the form of Common Stock. Any shares of Common Stock
tendered in satisfaction of an obligation arising under this Plan
shall be valued at the Fair Market Value of the Common Stock on
the day preceding the date of the issuance of such stock to the
Participant.

11. ALTERNATE OPTION PAYMENT MECHANISM.

The Company has sole discretion to determine what form of payment it
will accept for the exercise of an Option. The Company may indicate
acceptable forms in the ISO or NSO Agreement covering such Options or may
reserve its decision to the time of exercise. No Option is to be considered
exercised until payment in full is accepted by the Company or its agent.

(a) Cash Payment. The exercise price may be paid in cash or by
certified check.

(b) Borrowed Funds. To the extent permitted by law, the Company may
permit all or a portion of the exercise price of an Option to be
paid through borrowed funds.

(i) The Company may permit payment by the tendering of
previously acquired shares of Common Stock. This includes the use
of "pyramiding transactions" whereby some number of Options are
exercised; then the shares gained through the exercise are
tendered back to the Company as payment for a greater number of
Options. This transaction may be repeated as needed to exercise
all of the Options available.

(ii) Any shares of Common Stock tendered in payment of the
exercise price of an Option shall be valued at the Fair Market
Value of the Common Stock on the date prior to the date of
exercise.

10
<PAGE>
12. RIGHTS OF A SHAREHOLDER: NONTRANSFERABILITY.

No Participant shall have any rights as a shareholder with respect to
any shares of Common Stock covered by an Option until the date of issuance
of a stock certificate for such shares. Nothing in this Plan or in any
Award granted confers on any person any right to continue in the employ or
service of the Company or its Affiliates or interferes in any way with the
right of the Company or its Affiliates to terminate a Participant's
services as an officer or other employee at any time.

Except as permitted under the Code (with respect to Incentive Stock
Options) and the rules promulgated pursuant to Section 16(b) of the
Exchange Act or any successor statutes or rules, no Award under the Plan
shall be transferable by the Participant other than by will or the laws of
intestate succession or pursuant to a domestic relations order or unless
determined otherwise by the Committee.

13. AGREEMENT WITH GRANTEES.

Each Award will be evidenced by a written agreement(s) (whether
constituting an NSO Agreement, ISO Agreement, Stock Award Agreement or any
combination thereof), executed by the Participant and the Company or its
Affiliates that describes the conditions for receiving the Awards including
the date of Award, the Exercise Price if any, the terms or other applicable
periods, and other terms and conditions as may be required or imposed by
the Plan, the Committee, or the Board of Directors, and may describe or
specify tax law considerations or applicable securities law considerations.

14. DESIGNATION OF BENEFICIARY.

A Participant may, with the consent of the Company, designate a person
or persons to receive, in the event of death, any Award to which the
Participant would then be entitled. Such designation will be made upon
forms supplied by and delivered to the Company and may be revoked in
writing. If a Participant fails effectively to designate a beneficiary,
then the Participant's estate will be deemed to be the beneficiary.

15. DILUTION AND OTHER ADJUSTMENTS.

In the event of any change in the outstanding shares of Common Stock
by reason of any stock dividend or split, recapitalization, merger,
consolidation, spin-off, reorganization, combination or exchange of shares,
or other similar corporate change, or other increase or decrease in such
shares without receipt or payment of consideration by the Company, or in
the event a capital distribution is made the Company will make such
adjustments to Awards to prevent dilution, diminution or enlargement of the
rights of the Participant, as the Company deems appropriate, including any
or all of the following:

(a) adjustments in the aggregate number or kind of shares of Common
Stock or other securities that may underlie future Awards under
the Plan;

(b) adjustments in the aggregate number or kind of shares of Common
Stock or other securities underlying Awards already made under
the Plan; or

11
<PAGE>
(c) adjustments in the exercise price of outstanding Incentive and/or
Non-statutory Stock Options, or any Limited Rights attached to
such Options.

Alternatively, the Company could provide the participant with a cash
benefit for shares underlying vested, but unexercised options, in order to
achieve the aforementioned effect. All Awards under this Plan shall be
binding upon any successors or assigns of the Company.

16. TAX WITHHOLDING.

Awards under this Plan shall be subject to tax withholding to the
extent required by any governmental authority. Any withholding shall comply
with Rule 16b-3 or any amendment or successive rule. Shares of Common Stock
withheld to pay for tax withholding amounts shall be valued at their Fair
Market Value on the date the Award is deemed taxable to the Participant.

17. AMENDMENT OF THE PLAN.

The Board of Directors may at any time, and from time to time, subject
to applicable rules and regulations, modify or amend the Plan or any Award
granted under the Plan, in any respect, prospectively or retroactively;
provided however, that provisions governing grants of Incentive Stock
Options, unless permitted by the rules and regulations or staff
pronouncements promulgated under the Code shall be submitted for
shareholder approval to the extent required by such law, regulation or
interpretation.

Failure to ratify or approve amendments or modifications by
shareholders shall be effective only as to the specific amendment or
modification requiring such ratification. Other provisions, sections, and
subsections of this Plan will remain in full force and effect.

No such termination, modification or amendment may adversely affect
the rights of a Participant under an outstanding Award without the written
permission of such Participant.

18. EFFECTIVE DATE OF PLAN.

The Plan shall become effective upon being presented to shareholders
for ratification for the purpose of obtaining preferential tax treatment
for Incentive Stock Options. The failure to obtain shareholder ratification
for such purpose will not effect the validity of the Plan and the Options
thereunder, provided, however, that if the Plan is not ratified, the Plan
shall remain in full force and effect, and any Incentive Stock Options
granted under the Plan shall be deemed to be Non-statutory Stock Options.

19. TERMINATION OF THE PLAN.

The right to grant Awards under the Plan will terminate upon the
earlier of: (i) ten (10) years after the Effective Date; (ii) the issuance
of a number of shares of Common Stock pursuant to the exercise of Options
or the distribution of Stock Awards which together with the exercise of
Limited Rights is equivalent to the maximum number of shares reserved under
the Plan as set forth in Section 4. The Board of Directors has the right to
suspend or terminate the Plan at any time, provided that no such action
will, without the consent of a Participant, adversely affect a
Participant's vested rights under a previously granted Award.

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<PAGE>
20. APPLICABLE LAW.

The Plan will be administered in accordance with the laws of the State
of California and applicable federal law.

21. DELEGATION OF AUTHORITY.

Once established, the Compensation Committee may delegate all
authority for: the determination of forms of payment to be made by or
received by the Plan; the execution of Award agreements; the determination
of Fair Market Value; the determination of all other aspects of
administration of the plan to the executive officer(s) of the Company . The
Committee may rely on the descriptions, representations, reports and
estimate provided to it by the management of the Company for determinations
to be made pursuant to the Plan, including the attainment of performance
goals. However, only the Committee or a portion of the Committee may
certify the attainment of a performance goal.
_____________

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PROXY PROXY

TRI-NATIONAL DEVELOPMENT CORP.

PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON DECEMBER 29, 2000

The undersigned hereby appoints Michael A. Sunstein and Jason A.
Sunstein, President and Secretary, respectively, and each of them, as
attorneys and proxies of the undersigned, with full power of substitution,
to vote all of the shares of stock of Tri-National Development Corp. (the
"Company") which the undersigned may be entitled to vote at the Annual
Meeting of Shareholders of the Company to be held at 480 Camino Del Rio
South, Suite 140, San Diego, California 92108 on December 29, 2000 at 9:00
a.m. local time and at any and all continuations and adjournments or
postponements thereof, with all powers that the undersigned would possess
if personally present, on the following matters, in accordance with the
following instructions, and on all matters that may properly come before
the meeting. With respect to any matter not known to the Company as of
December 25, 2000, such proxies are authorized to vote in their discretion.

UNLESS A CONTRARY DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED FOR
ALL NOMINEES LISTED IN PROPOSAL 1 AND FOR PROPOSALS 2 AND 3 MORE
SPECIFICALLY DESCRIBED IN THE PROXY STATEMENT. IF SPECIFIC INSTRUCTIONS
ARE INDICATED, THIS PROXY WILL BE VOTED IN ACCORDANCE THEREWITH.

YOUR VOTE IS IMPORTANT. THEREFORE, YOU ARE URGED TO COMPLETE,
SIGN, DATE AND PROMPTLY RETURN THIS PROXY
IN THE ENCLOSED ENVELOPE.

(Continued and to be signed on the other side)

<PAGE>
TRI-NATIONAL DEVELOPMENT CORP.

PLEASE MARK VOTE IN THE FOLLOWING MANNER USING DARK INK ONLY. [X]

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES
FOR DIRECTOR AND FOR PROPOSALS 2 AND 3.

1. To elect seven directors to hold office until the 2000 Annual
Meeting of Shareholders.

FOR WITHHELD VOTE FOR NOMINEE(S) NOT LINED OUT

[ ] [ ] Strike a line through the
nominee(s) name or names below
that you do not vote for

NOMINEES: Michael A. Sunstein, Shane Kennedy, Jay Pasternak, Robert
Rosen, M.D., Theodore Takacs, Jerry J. Parker, M.D. and Gil Fuentes.

2. To approve the continuation of Ludlow & Harrison, LLP as the
Company's independent public accountants for the fiscal year ending April
30, 2001.

FOR AGAINST ABSTAIN

[ ] [ ] [ ]

3. To approve the Company's 2000 Equity Incentive Plan.

FOR AGAINST ABSTAIN

[ ] [ ] [ ]

_____________________________________
Signature

Please vote, sign, date and promptly return this proxy in the enclosed
return envelope which is postage prepaid if mailed in the United States.

Please sign exactly as your name appears hereon. If the stock is
registered in the names of two or more persons, each should sign.
Executors, administrators, trustees, guardians and attorneys-in-fact should
add their titles. If signer is a corporation, please give full corporate
name and have a duly authorized officer sign, stating title. If signer is
a partnership or limited liability company, please sign the company name by
authorized person.