SECURITIES AND EXCHANGE COMMISSION
                        Washington, DC 20549

                             Form 10-K/A

             (X) ANNUAL REPORT UNDER SECTION 13 OR 15(d) OF 
                   THE SECURITIES EXCHANGE ACT OF 1934

                  For the Fiscal Year Ended June 30, 1998

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

                     Commission File Number: 000-24999

                          LOTUS PACIFIC, INC
          (Exact name of registrant as specified in its charter)

                              Delaware
                       (State of Organization)

                             52-1947160
                  (I.R.S. Employer Identification Number)

      200 Centennial Avenue, Suite 201, Piscataway, New Jersey 08854
                  (Address of principal executive offices)

                           (732) 885-1750
            (Registrant's telephone number, including area code)


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


 Indicate by check mark whether the Registrant (1) filed all reports required
to be filed by Section 13 or 15 (d) of the Exchange Act during the preceding
12 months (or for such shorter period than the registrant was required to
file such reports), and (2) has been subject to such filing requirements for
the past 90 days.

                       Yes  ___X___    No ______

 Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-B is not contained herein, and will not be contained to
the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. (   )

 The aggregate market value of the voting stock held by non-affiliates of the
Registrant was approximately $304 million as of June 30, 1998, based on the
closing sale price on the OTC Bulletin Board reported for such date. Shares
of common stock held by each executive officer and director and by each person
known by the Company to own 5% of more of the outstanding common stock have
been excluded in that such persons may be deemed to be affiliates. This
determination of affiliate status is not necessarily a conclusive
determination for other purposes.

 The number of shares outstanding of Registrant's Common Stock, $0.001 par
value, was 47,386,804 shares at June 30, 1998. 


                 DOCUMENTS INCORPORATED BY REFERENCE

 The information required by Part III of this report, to the extent not set
forth herein, is incorporated herein by reference from the Registrant's
definitive proxy statement relating to the annual meeting of stockholders to
be held in 1998, which definitive proxy statement shall be filed with the
Securities and Exchange Commission within 120 days after the end of the
fiscal year to which this Report relates.




                         LOTUS PACIFIC, INC.
                             FORM 10-K
                   FOR THE YEAR ENDED JUNE 30, 1998



                           TABLE OF CONTENTS

Part I

 Item 1.    Business           
 Item 2.    Properties                       
 Item 3.    Legal Proceedings                                         
 Item 4.    Submission of Matters to a Vote of Security Holders   

Part II

 Item 5.    Market for Registrant's Common Equity and Related Stockholder
            Matters 
 Item 6.    Selected Financial Data 
 Item 7.    Management's Discussion and Analysis of Financial Condition and
            Results of Operation  
 Item 7A.   Quantitative and Qualitative Disclosures about Market Risk
 Item 8.    Financial Statements and Supplementary Data                     
 Item 9.    Changes in and Disagreements with Accountants on Accounting and
            Financial Disclosure

Part III

 Item 10.   Directors and Executive officers of the Registrant
 Item 11.   Executive Compensation
 Item 12.   Security Ownership of Certain Beneficial Owners & Management
 Item 13.   Certain Relationship and Related Transactions

Part IV

 Item 14.   Exhibits, Financial Statement Schedules and Reports on Form 8-K


Signatures




                                 Part I


Item 1. BUSINESS

 Except for historical information contained herein, the matters discussed
in this report contain certain forward-looking statements based on current
expectations, estimates and projections about the Company's business,
management's beliefs and certain assumptions made by the management. These
forward-looking statements involve risks and uncertainties that could cause
actual results to differ materially from those anticipated in such forward-
ooking statements.

GENERAL 

 Lotus Pacific, Inc. (the "Company" or "Registrant") is a holding company
for Regent Electronics Corp. ("Regent") and LPF International Corp. ("LPF").
The Company, through its 87.3%-owned subsidiary Regent, designs, engineers,
develops, provides and markets Internet related electronic products and
services to electronics manufactures, commercial cable TV networks, and
general individual customers. 

 LPF International Corp., a wholly, owned subsidiary of the Company, is an
apparel fashion designer, wholesaler and manufacturer located in New York,
NY. For the fiscal year ended June 30, 1998, Regent provides the Company with
43 % of revenues and LPF contributes the remaining 57%.

 Using its Internet research and development capabilities, including TeleWeb
broadcasting system, set top boxes, WonderTV series products, the Company
has started on-line service business. The business operation includes: (a)
providing retail services over the Internet to Chinese customers for
purchasing a variety of well-designed, high-margin merchandises made in North
America or Europe, and (b) offering information and electronic commerce 
services. The Company's marketing target is China's 1.2 billion people with
unsatisfied thirst for information to make their day-to-day business and
entertainment decisions. The information and services provided by the Company
includes breaking financial news, real-time stock quotes, corporate financial
information as well as consumer entertainment information. The information
may be derived either directly from the Internet or from the Company's own
sources. The electronic commerce services consist of advertising sales and
initiating business transactions over the Internet, such as home shopping,
online stock trading and online utility bill payments. The management of the
Company believes that the Internet will provide the Company with a powerful
point of entry into the world's biggest emerging market.

The Company was incorporated under the laws of the State of Delaware on
June 25, 1985, as Quatech, Inc. to raise capital and investigate and acquire
any suitable asset, property or pursue other business opportunities. In April
1987, the Company completed a public offering of securities registered on
Form 3-18 with the Securities and Exchange Commission. In June 1993, the
Company disposed of all of its interests in other entities and ceased to have
any business operations.

 In September 1994, the Company was reorganized and changed its name to Lotus
Pacific, Inc. In January 1997, the Company's majority ownership was changed.
After new directors and executive officers were elected, the Company set up
two wholly owned subsidiaries, Richtime Far East Ltd. in Hong Kong and Regent
Electronics Corp. registered in the State of Delaware.  

 In June, 1997, the Company, through its subsidiary Regent Electronics Corp.,
acquired Amiga-based multimedia technology and its related assets and rights
from Rightiming Electronics Corp. for an aggregate consideration of US $5
million plus 8 million shares of common stock of Regent Electronics Corp. The
acquired assets included all Amiga-Commodore's patents, licenses, trademarks,
and copyrights to be registered and used in China, Taiwan, Hong Kong, Macao,
and the bordering countries between China and the former Soviet Union. Over
the past years Regent developed a series of multimedia and multi-functional
TV-based set-top Internet access devices, including the TeleWeb Broadcasting
System, WonderTV A6000, A6060, A8000, and A9000.
  
 In March 1997, Richtime Far East Ltd., a subsidiary of the Company, started
its high quality garment and textile import-export business in Hong Kong. The
Company receives customer orders from Europe and North America, and contracts
with garment or textile manufacturers, mainly in China, to complete those
orders. The Company then ships the finished goods overseas. In February 1998,
the Company set up a new wholly owned subsidiary LPF International Corp.
(" LPF"). LPF is incorporated in the State of Delaware and operated in New
York, NY. The purpose of LPF is to expand the Company's existing textile and
apparel business worldwide and place more emphasis on fashion design.
Richtime Far East Ltd. was then merged into LPF to be an indirect subsidiary
of the Company.

 Since June 1997, the Company has invested significant resources in research,
product development, and engineering activities for its Internet broadcasting
system and its WonderTV series of set-top box and other related products. As
a result of these R&D activities and the low volume of sales during the
initial commercialization of its products, the Company incurred net operating
losses during the fiscal year ended June 30, 1998. The Company anticipates
that it will continue to make significant expenditures for product development
and marketing of its Internet-related products in the foreseeable future. The
Company believes that its TV-based products currently have greater market
potential than its PC-based Internet access products. See Item 6- Management's
Discussion and Analysis or Plan of Operation".
   
THE COMPANY'S PRIMARY PRODUCTS AND SERVICES

 The Company has primarily positioned itself as a researcher and developer
of cable TV-based Internet access related consumer electronics products,
including hardware and software. The Company then licenses its technologies
to electronics manufacturers or contracts to manufacturers. The Company does
not maintain manufacturing facilities.
 
TELEWEB SYSTEM AND WONDER-TVS

 The Company's products include the TeleWeb System and WonderTV series
products. The TeleWeb system is a WWW broadcasting system to send the
Internet contents and selected commercial information through existing
cable TV networks subscribers. Based on the technology of the TeleWeb system,
the Company has developed WonderTV series products: WonderTV A6000, A6060,
A8000, and A9000.

 Using the Company's TeleWeb system and its WonderTV terminals, subscribers
can download desirable information to the hard disk of WonderTV according
to the monitored data attributes of the user selection. Information is
updated in real time and can be stored on the hard disk for later use. The
Company offers a variety of related services, such as pay-per-view, real time
stock trading, on-line shopping and commercial advertisement.

ONLINE SERVICES

 Using its Internet research and development capabilities, the Company
launched a project to: (1) provide online merchandise retail services over
the Internet to Chinese customers with a variety of well-designed
merchandises made in North America or Europe. The Company's ready-to-launch
online specialized superstore features a fun, easy to navigate interface
with extensive product information and powerful search capabilities, and 
(2) provide information and electronic commerce services to hundreds of
millions of Chinese people. The information provided includes breaking
financial news, real-time stock quotes, corporate financial information as
well as consumer entertainment information. The information may be derived
either directly from the Internet or from the Company's own sources. The
management of the Company believes that its targeted market of consumers
represents an attractive and rapidly growing segment of the Web commerce
industry.

PATENTS, TRADEMARKS AND LICENSES
 
The Company is pursuing patent applications in certain foreign countries.
There can be no assurance that any of the Company's currently pending patent
applications or future applications will be granted in full or in part or
that claims allowed will be sufficiently broad to protect the Company's
technology. The Company currently holds all right, title, and interest in
and to the trademarks, copyrights, patent license of Amiga-Commodore for
registration and use in the People's Republic of China, Taiwan, Hong Kong,
Macao and the Asian bordering countries between the People's Republic of
China and the former Soviet Union.

COMPETITION
 
 As the Company enters the market for Internet related products, it expects
to experience significant competition from both existing competitors and
additional companies that may enter this market. Some of these companies have
greater technical, marketing, manufacturing, and financial resources than the
Company.

To address the competitive nature of the business the Company is constantly
seeking innovation to maintain its competitive edge.  This includes using
newly developed technology to periodically upgrade its electronic products
always with new features accustomed to local users. 

 The markets for the Company's products are highly competitive and are
characterized by rapid technological advances, frequent new product
introductions, evolving industry standards, and competitive price pressures.
The Company will continue to develop and market appropriate products to
remain competitive. The Company believes that one of the factors in its
competitive success is its continued commitment of resources to research and
development.

EMPLOYEES

 As of June 30, 1998, the Company had 47 full-time employees. The Company
also employs independent contractors and other temporary employees in its
software development department. None of the Company's employees is
represented by a labor union. The Company considers relations with its
employee to be excellent.


Item 2. PROPERTIES

 The Company's corporate headquarters, including Regent's offices and R&D
facility, is located at 200 Centennial Avenue, Piscataway, New Jersey and
consist of approximately 9,400 square foot under a lease that expires 0n
June 4, 2002. The company's subsidiary LPF is housed in a 6,800 square-foot
leased space at 525 Seventh Avenue, New York, NY. The Company believes that
its existing facilities are adequate to meet its requirements for the near
term and that additional space will be available on commercially reasonable
terms if needed.

The following table summarizes the lease agreements held by the Company and
its subsidiaries relating to offices and other facilities:


Location     Lease Term       Commence Date        Expiration Date 

Piscataway   5 years          June 5, 1997         June 4, 2002  
New Jersey

New York     10 years         June 28, 1998        Oct. 28, 2008  
New York

Middlesex    Annual           June 5, 1998         Renewable  
New Jersey   Renewable


Overseas, Regent maintains a technical support and sales office space in
Shanghai, China, and Richtime Far East, Ltd. maintains an office space
at 3/F, 4 Hok Yuen Street East, Hunghom, Hong Kong.


Item 3. LEGAL PROCEEDINGS

 As of the date hereof, there is no pending, or, to the best knowledge of the
Company,  threatened litigation involving the Company.


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

 No matter was submitted to a vote of the security holders, through
solicitation of proxies or otherwise, during the fiscal year covered by this
report.



                                 Part II


Item 5. MARKET FOR COMPANY'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

MARKET INFORMATION

 The Company's Common Stock, par value $0.001, has been traded on OTC
Electronic Bulletin Board under the symbol "LPFC" since December 1, 1994,
and there are currently ten (10) market makers for the stock of the Company.

 The table below sets forth the high and low closing prices of the Company's
Common Stock from January 1997 through June 30, 1998. These price quotations
reflect interdealer prices, without retail mark-up, mark-down or commission,
and may not necessarily represent actual transactions.

 
 Quarter Ended                   High                Low
 -------------------------     --------            -------

 1997
 March 31, 1997                  $2.50              $0.13
 June 30, 1997                   $4.50              $1.50
 September 30, 1997              $7.00              $2.38
 December 31, 1997               $7.13              $4.87
 
 1998
 March 31, 1998                  $7.50              $5.50
 June 30, 1998                   $10.50             $5.88


NUMBER OF REGISTERED HOLDERS

 The number of registered holders of the Company's Common Stock as of
June 30, 1998, was 534, and the Company believes that there are a greater
number of beneficial owners of shares of its Common Stock.

DIVIDENDS

 To date, the Company has not declared or paid any cash dividends on its
Common Stock. The Company currently anticipates that it will retain all
available funds for use in the operation and expansion of its business, and
no cash dividend are expected to be paid on the Common Stock in the
foreseeable future. Further, there can be no assurance that the proposed
operations of the Company will generate the revenue and cash flow needed to
declare cash dividends in the foreseeable future.

RECENT SALES OF UNREGISTERED SECURITIES

 The transactions set forth below were deemed exempt from registration under
the Securities Act of 1933, as amended (the "Securities Act"), by reason of
Section 4(2) of the Securities Act. In connection with each of these
transactions, the shares were sold to a limited number of accredited
investors as defined by Item 501 of Regulation D of the Securities and
Exchange Commission (the "Commission"). The accredited investors were
provided opportunities to get access to all relevant information regarding
the Company and they represented to the Company that they were
"sophisticated" investors.  They also represented to the Company that the
shares they purchased were for investment purposes only. Restrictive legends
were placed on all stock certificates.

 On September 18, 1997, the Company issued 6 million shares of its Common
Stock to Rightiming Electronics Corp. in exchange for 6 million shares of
Regent Electronics Corp., a subsidiary of the Company. The purpose of the
share exchange was to gain more control over the subsidiary of the Company.

 On February 8, 1998, the Company entered into a stock subscription agreement
with Hambrecht & Quist Asia Pacific Ltd. and its affiliate Asia Pacific
Growth Fund II, L.P. (collectively "H&Q"). Under the agreement, H&Q invested
$6 million to acquire 1,500,000 shares of Preferred Stock of Regent
Electronics Corp., a subsidiary of the Company. H&Q's acquisition represented
approximately 5.5% of equity interest of Regent Electronics Corp. Pursuant to
the agreement, the Regent shares held by H&Q may be converted, subject to
certain conditions, into Common Stock shares of the Company after January 1,
2000.

 During the period of June 30, 1997 through June 30, 1998, the Company sold
648,500 shares of the Common Stock to ten accredited investors for an
aggregate consideration of $2,594,000.


Item 6. SELECTED FINANCIAL DATA

 The following selected consolidated financial data as of and for each of
the three fiscal years in the period ended June 30, 1998 has been derived
from the consolidated financial statements of the Company, which have been
audited by Schiffman Hughes Brown, independent auditors, whose reports as of
June 30, 1998, 1997 and 1996 are included elsewhere herein. The selected
consolidated financial data should be read in conjunction with the attached
consolidated Financial Statements and the related notes thereto and
"Management's Discussion and Analysis or Plan of Operation" appearing in
Item 7 of this Form 10-K.


                        Selected Consolidated Financial Data
                        (in thousands, except per share data)

                             Fiscal Year Ended June 30

                                           1998          1997       1996

Consolidated Statement of Operations Data:
 Revenues ............................     4,843          410         40
 General and administrative expenses..     3,436          310         18
 Research and Development ............     3,762           15     

 Minority interest in loss of
  Consolidated subsidiary ............       218           82

 Operating income (loss) .............    (2,057)          43         22

 Net income per share ................      (.05)         .00        .00

 Weighted average shares outstanding..     44,421      29,238     26,799




                             Fiscal Year Ended June 30


                                           1998          1997       1996
Balance Sheet Data:

    Working capital ..................    6,920           107        213
     Total assets ....................   16,404         8,221        385
     Long-term obligation ............        0             0          0
     Total shareholders' equity ......    7,820         5,739       3,85



Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

 The following Management's Discussion and Analysis of Financial Condition
and Results of Operations should be read in conjunction with the Company's
Consolidated Financial Statements as of June 30, 1998 and 1997 included
herein this Report on Form 10-K for the fiscal year ended June 30, 1998.

OVERVIEW

 Regent, designs, engineers, develops, provides and markets Internet related
electronics products and services to electronics manufactures, commercial
cable networks, and general individual customers. Using its Internet research
and development capabilities, including the TeleWeb broadcasting system,
set-top boxes, WonderTV series products, the Company has started its on-line
service business. 

The Company has primarily positioned itself as a researcher and developer of
cable TV-based Internet access related consumer electronics products,
including hardware and software. The Company then licenses its technologies
to electronics manufacturers or contracts to manufacturers. 
 
The Company's products include the TeleWeb System and WonderTV series
products. The TeleWeb system is a WWW broadcasting system to send Internet
contents and selected commercial information through existing cable TV
network subscribers. Based on the technology of the TeleWeb system, the
Company has developed WonderTV series products: WonderTV A6000, A6060,
A8000, and A9000.

 Using the Company's TeleWeb system and its WonderTV terminals, subscribers
can download desirable information to the hard disk of WonderTV according to
the monitored data attributes of the user selection. Information is updated
in real time and can be stored on the hard disk for later use. The Company
offers a variety of related services, such as pay-per-view, real time stock
trading, on-line shopping and commercial advertisement.

 In 1998, the Company launched a project to: (1) provide online merchandise
retail services over Internet to Chinese customers with a variety of
merchandises made in North America or Europe. The Company's ready-to-launch
online specialized superstore features a fun, easy to navigate interface with
extensive product information and powerful search capabilities, and (2)
provide information and electronic commerce services to hundreds of millions
of Chinese people. The information provided includes breaking financial news,
real-time stock quotes, corporate financial information as well as consumer
entertainment information. The information may be derived either directly
from the Internet or from the Company's own sources. The management of the
Company believes that its targeted market of consumers represents an
attractive and rapidly growing segment of the Web commerce industry.

RESULTS OF OPERATIONS

FISCAL 1998 AS COMPARED TO FISCAL 1997

  Revenues   During fiscal 1998, the Company generated its revenue primarily
from (1) licensing the rights to its software products to business customers;
(2) resale of chipsets; and (3) sales from its textile and apparel business.
The Company's revenues reached $7.99 million in fiscal 1998 from zero in
fiscal 1997. 

  International sales in fiscal 1998 represented 52% of net sales. The Company
had no sales in fiscal 1997.
 
  Research and Development  Fiscal 1998's increase in research and development
expenses was primarily a result of developing the TeleWeb broadcasting system
and setting up online merchandise retail and electronic commerce services. The
Company's software development costs are recorded in accordance with Statement
of Financial Accounting Standards No. 86. To date, the Company has expensed
all of its internal software development.

  General and Administrative General and administrative expenses increased to
$3.44 million in fiscal 1998 from $310,241 in fiscal 1997. The primary reason
for the increase was hiring more software engineers to conduct product
development. The other increase was due to the fact that the Company has to
rent more office space for its growing business activities. In addition,
administrative expenses including legal and accounting also increased. 

  Operating Loss    As a result of the factors discussed above, the Company's
operating income decreased from $43,390 in fiscal 1997 to $2.06 million of
net loss in fiscal 1998.

  Income Taxes.  The Company's losses for fiscal 1998 may be utilized as an
offset against future earnings, although there is no assurance that future
operations will produce taxable earnings.
 

FISCAL 1997 AS COMPARED TO FISCAL 1996

 The Company became active in January 1997. For the fiscal year ended June
30, 1997, the Company had a net income of $43,390 compared to $22,160 in
fiscal 1996.

   Revenues The revenues of the Company in fiscal 1997 were $582,386 compared
to $40,098 in fiscal 1996. The revenues in fiscal 1997 were primarily from
the sale of its investment in Rightiming Electronics Corp., a NJ-based high
tech company.

   Research and Development   Regent Electronics Corp., a subsidiary of the
Company, began to carry out its product development activities in June 1997.
For the fiscal year ended June 30, 1997, the Company had R&D expenses of
$14,703. There were no R&D expenses in fiscal 1996.

Net Income. The Company became active in January 1997. For the fiscal year
ended June 30, 1997, the Company had a net income of $43,390 compared to
$22,160 in fiscal 1996.

   Income Taxes.  The Company had no income taxes liabilities in fiscal 1997
and 1996 because those income taxes liabilities were offset by the Company's
net operating losses (NOLs) incurred in previous years.

LIQUIDITY AND CAPITAL RESOURCES

 The Company ended the fiscal 1998 with a cash and cash equivalents position
of approximately $3.2 million, compared to $268,679 in fiscal 1997.

 Since January 1997, the Company has financed its operations and expenditures
primarily through the sale of capital stock. On February 8, 1998, Hambrecht &
Quist Asia Pacific Ltd. and its affiliate Asia Pacific Growth Fund II, L.P.
(collectively "H&Q") invested $6 million to acquire 1,500,000 shares of
Preferred Stock of Regent Electronics Corp. H&Q's acquisition represented
approximately 5.5% of equity interest of Regent. Pursuant to the agreement,
subject to certain conditions, the Regent shares held by H&Q may be converted
into Common Shares of the Company after January 1, 2000.

 During the period of June 30, 1997 through June 30, 1998, the Company sold
648,500 shares of the Common Stock to ten accredited investors for an
aggregate consideration of $2,594,000.

 At June 30, 1998, the Company had working capital of $6.92 million (an
increase of $6.8 million from $106,924 as of June 30, 1997). During Fiscal
1998, operating activities provided $766,302 of net cash, investing
activities used $ 113,854 of net cash for equipment purchases, and financing
activities provided $2.27 million of net cash, primarily from H&Q's investment
and private placements. Approximately 60% of net cash used in 1998 were spent
on research and development and related activities.

 The Company believes that the anticipated funds from operations and the
existing cash and cash equivalents will be sufficient to meet its cash
requirements for at least the next twelve months. Although the Company's
operating activities may generate cash to cover its operating costs, the
Company's continuing operating and investing activities may require the
Company to obtain additional sources of financing. There can be no assurance
that any necessary additional financing will be available to the Company on
commercially reasonable terms, if at all.

 The Company's foreign sales are denominated in U.S. dollars. The Company
does not incur any foreign currency risks; however, fluctuations in currency
exchange rates could cause the Company's products and services to become
relatively more expensive to foreign customers, which may result in a
reduction in foreign sales or the profitability of any of such sales.

Historically, the size and timing of sale transactions have varied
substantially from quarter to quarter, and the Company expects such
variations to continue into the future. Because a significant portion of
the Company's overhead is fixed in the short-term, the Company's results
of operations may be adversely affected if revenues fall below the Company's
expectation.

 In fiscal 1999, the Company, through its subsidiary Regent Electronics
Corp., will actively look for business opportunities in China and its
bordering countries to manufacture and market its TeleWeb broadcasting system
and WonderTV series products. The Company has been contacting several big TV
manufacturers in China seeking a contractor for such purpose. The Company is
confident in its market potential based on the continuation of economic
growth and the increasing demand for Internet access and multimedia
entertainment in China. It is part of the Company's business strategy to use
the revenues generated from sales of the TeleWeb system and WonderTV series
products to finance the Company's research and development activities in its
new generation of products for multimedia home entertainment.

 Some international companies with capability of producing similar products
are also trying to enter into the China's multimedia entertainment market.
To improve its competitiveness, the Company focuses on products that are
accustomed to China's cultural tradition and the Company will persist in its
aggressive drive to reduce business cost. While subject to many variables,
the Company anticipates revenue increases in the coming fiscal year. At the
same time, the Company will continue to raise capital necessary for its
expansionary operations and research and development activities.

RECENTLY ISSUED FINANCIAL ACCOUNTING STANDARDS

 Effective for fiscal 1998, the Company adopted SFAS No. 123, "Accounting for
Stock-Based Compensation", and, as permitted by this standard, will continue
to apply the recognition and measurement principles of Accounting Principles
Board Opinion No. 25 to its stock options. This statement requires footnotes
disclosure of the pro forma impact on net income and earnings per share of
the compensation cost that would have been recognized if the fair value of
all stock-based awards were recorded in the income statement.

 In March 1997, the Financial Accounting Standards Board issued SFAS No. 128,
"Earnings Per Share" which simplifies the standards for computing EPS
previously found in Accounting Principles Board Opinion No. 15 and makes
them comparable to international EPS standards. The Statement is effective
for financial statements issued for periods ending after December 15, 1997.
Had this statement been effective for the years ended June 30, 1997 and 1996,
earnings would have been presented as follows:


                   Year ended June 30          1998         1997

  EPS:     basic ................             $(.05)        $0.00
  EPS:     diluted ..............             $(.05)        $0.00


 In June 1997, the Financial Accounting Standards Board (FASB) issued two
SFASs: SFAS No. 130, "Reporting Comprehensive Income", and SFAS No. 131,
"Disclosures about Segments of an Enterprise and Related Information". As
specified by these statements, the Company will apply these statements
beginning in fiscal 1999 and reclassify its financial statements for earlier
periods provided for comparative purposes.

 SFAS 130 establishes standards for reporting and display of comprehensive
income and its components (revenues, expenses, gains, and losses) in a full
set of general-purpose financial statements. This statement requires that all
items that Are required to be recognized under accounting standards as
components of comprehensive income be reported in a financial statement that
is displayed with the same prominence as other financial statements.

 SFAS 131 establishes standards for the way that the public business
enterprises report information about operating segments in annual financial
statements and requires that those enterprises report selected information
about operating segments in interim financial reports issued to shareholders.
It also establishes standards for related disclosures about products and
services, geographic areas, and major customers. This Statement supersedes
FASB Statement No. 14, "Financial Reporting for Segments of a Business
Enterprise", but retains the requirement to report information about major
customers. It amends FASB No. 94, "Consolidation of All Majority-Owned
Subsidiaries", to remove the special disclosure requirements for previously
unconsolidated subsidiaries.

At this point, the Company has not determined the impact of adopting SFAS 131.


Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 The Company has not entered into any transactions using derivative financial
instruments or derivative commodity instruments and believes that its
exposure to market risk associated with other financial instruments (such as
investments) are not material.
 

Item 8. FINANCIAL STATEMENTS

 See Item 14 (a) for an index to the audited consolidated financial
statements and supplementary financial information that are attached hereto.


Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTING AND FINANCIAL DISCLOSURE

 The Company appointed the accounting firm of Schiffman, Hughes & Brown to
serve as the independent auditors of its year-end financial statements
starting from its fiscal year of 1995. To the best knowledge of the current
management, the Company did not use an auditor for its fiscal year prior to
1995 and therefore had no auditors.  

 The Company has no disagreement with accounting and financial disclosure. 


                                 Part III


Item 9.     DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT 
 
 The Company's directors, executive officers and their respective ages and
positions as of June 30, 1998 are as follows: 
   
 Name              Age           Date         Appointed Position

James Yao (2)      44           Jan. 1997     Chairman, President & Director
David Leung        53           Jan. 1997     Vice President & Director
James Liu          43           Jan. 1997     Vice President & Director
Jeremy Wang(1) (2) 43           May 1997      Director
Simon Gu (1)       43           Sept. 1997    Director
Gary Huang (1)     42           Jan. 1997     Treasurer, Secretary & Director

Notes:
  (1)  Member of the Audit Committee.
  (2)  Member of the Compensation Committee


  The following are biographies of the Company's executive officers and
directors for the recent years.
 
JAMES YAO joined the Company as President and a Director in January 1997 and
was elected Chairman of the Board of Directors. He has over 15 years of
business experience in multinational companies as well as new ventures in
textile and apparel industry, most recently with Yao Investment Corp. and
Lotus International Holdings Corp., where he served as Chairman. Mr. Yao
graduated from Miya Gawa University in Tokyo, Japan.

DAVID LEUNG joined the Company as Vice President in January 1997. Prior to
joining the Company, Mr. Leung served as General Manager of Shenzhen New
Technology Development Co., Ltd. in Shenzhen, China. He is a director of Lotus
International Holdings Corp. He was employed as a research fellow with
Electronics Research Institute in Guangzhou, China under Academia Sinica from
1984 to 1992. Mr. Leung had a BS from Beijing Institute of Technology.

JAMES LIU has been a director and Vice President of the Company since January
1997. Prior to his joining the Company, Mr. Liu served as President of JBL
International Inc. in New York, NY. He is a director of Lotus International
Holdings Corp. From 1983 to 1990, he was a manager in charge of international
trade in Jiangsu Provincial Government of the People's Republic of China. He
graduated with a BA degree from Nanjing University, China.

JEREMY WANG was elected Director in March 1997. In the past ten years, he
worked at AT&T Bell Laboratories and Merck & Co. He held various
responsibilities in system engineering, development and product management
in the telecommunications industry. Mr. Wang had an MS in Chemical
Engineering from University of Virginia, and a MS in Computer Science from
New Jersey Institute of Technology.

SIMON GU has been a director since September 1997. Mr. Gu has more than
twelve years of experience in electronics and computer industries, and has
been a senior computer engineer at AT&T since 1990. He held several senior
technology positions at US Army Armament Research, Development and
Engineering Center and Information Department of Town & County International,
Inc. from 1987 to 1990. Mr. Gu holds a Master of Sciences in computer
sciences from Polytechnic University of New York and a BS in computer
sciences at Kean College of New Jersey.

GARY HUANG has been Treasurer and Secretary of the Company since January
1997. Prior to joining the Company, Mr. Huang served as Senior Accountant
/Financial Analyst at Rightiming Electronics Corp. with full responsibilities
in accounting, financial reporting and treasury functions. He holds an MBA
in finance from University of New Haven and an MA in Economics from Yale
University.

All directors hold office for their elected term or until their successors
are duly elected and qualified. Should a director be disqualified or unable
to serve as a director, the vacancy so arising may be filled by the Board of
Directors for the unexpired portion of his term. All officers serve at the
discretion of the Board of Directors. There are no family relationships among
the members of the Board of Directors or any executive officers of the
Company.

COMMITTEES AND BOARD COMPENSATION

 The Board of Directors conducts its business through meetings of the Board
of Directors and through its committees. In accordance with the By-laws of
the Company, the Board of Directors has established an Audit Committee and
a Compensation Committee. 

AUDIT COMMITTEE

 The Audit Committee acts on behalf of the Board of Directors with respect
to the Company's financial statements, record-keeping, auditing practices and
matters relating to the Company's independent public accountants, including
recommending to the Board of Directors the firm to be engaged as its
independent public accountants for the next fiscal year; reviewing with the
Company's independent public accountants the scope and results of the audit
and any related management letter; consulting with the independent public
accountants and management with regard to the Company's accounting methods
and adequacy of its internal accounting controls; approving the professional
services rendered by the independent public accountants; and reviewing the
independence of the independent public accountants. The Audit Committee
consists of Directors Jeremy Wang, Simon Gu and Gary Huang.

COMPENSATION COMMITTEE

 The Compensation Committee reviews and makes recommendations to the Board
of Directors the appropriate compensation of directors and executive officers
of the Company. The Compensation Committee consists of Directors James Yao
and Jeremy Wang.

DIRECTORS' COMPENSATION

 Directors are not paid a fee for attending Board of Directors or committee
meetings, but are reimbursed for their travel expenses to and from the
meetings.
 
INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS

 None of the officers or directors has been involved in any material legal
proceedings that occurred within the last five years of any type as described
in Section 401(f) of Regulation S-B.


Item 11. EXECUTIVE COMPENSATION

 The following Summary Compensation Table sets forth information concerning
the total compensation of the Company's executive officers for services
rendered in all capacities to the Company for the fiscal year ended
June 30, 1998:


                        Cash Compensation  
Names of                for twelve Months                        Other
Officers                Ending June 30, 1998   Stock Options   Compensations
   
James Yao                  $ 68,000            None (Note 1)       None
President & Chairman of the Board

James Liu                  $ 68,000            None (Note 1)       None
Vice President & Director  

David Leung                $ 0                 None (Note 1)       None
Vice President & Director

Gu Huang                   $ 36,000            None                None
Treasurer & Secretary
---------------------------------------------------------------------
Note 1:  No stock options were granted in fiscal 1998 to the Company's
directors and officers. For fiscal 1997, the Company issued 1,090,000 shares
of stock options to its four directors and officers as part of the
compensation plans. Each of those options is currently exercisable at an
exercise price of $6.00 per share and shall be expired on May 15 and
May 30, 2002. As of June 30, 1998, no stock options have been exercised.


Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS & MANAGEMENT

 The Company has 47,386,804 shares of common stock issued and outstanding
and 4,300 shares of Series A Preferred Stock issued and outstanding. All of
the series A Preferred Stock is owned by Lotus International Holding Corp.
The following institutional investors hold 5% or more of the Company's
common stock shares:


 Lotus International Holdings Corp.     9,000,000 shares        15.9%
 Yao Investment Corp.                   8,000,000 shares        14.2%
 Rightiming Electronics Corp.           6,000,000 shares        10.6%
 Evolving Investments Ltd.              3,100,000 shares         5.5%
 

 The percentages indicated are based on the Company's Stock Options and
Warrants exercisable as of June 30, 1998 and 47,386,804 shares of Common
Stock issued and outstanding as of June 30, 1998.
 
None of the Company's officers and directors own shares individually, except
stock options. See Item 11 "Executive Compensation".

 Each share of Series A Preferred Stock has one vote.

 James Yao and James Liu constitute all the directors of Lotus International
Holdings Corp. and James Yao also serves as President of Yao Investment Corp.

 There are no arrangements including pledges by any person of securities of
the Company, the operation of which may at a subsequent date result in a
change in control of the Company.


Item 13. CERTAIN RELATIONSHIP AND RELATED TRANSACTIONS

 On December 2, 1997, Lotus International Holdings Corp., a shareholder of
the Company, disposed of the Company's Common Stock shares to its
shareholders, affiliate companies and related parties. From this transaction,
Yao Investment Corp. received 8 million shares of Common Stock of the
Company. James Yao, President & Chairman of the Company, also serves as
President of Yao Investment Corp.

 
Item 14.  EXHIBITS AND REPORTS ON FORM 8-K

 (a) The following documents are filed as a part of this report:

    1.  Financial Statements and Reports of Schiffman Hughes Brown,
        Independent Auditors 

        Report of Schiffman Hughes Brown, Independent Auditors

        Consolidated Balance Sheet as June 30, 1998 and 1997

        Consolidated Statements of Operations for the Fiscal Years ended
        June 30, 1998, 1997 and 1996

        Consolidated Statements of Shareholders' Equity for the Fiscal Years
        Ended June 30, 1998, 1997 and 1996

        Consolidated Statements of Cash Flows for the Fiscal Years Ended
        June 30, 1998, 1997 and 1996

        Notes to Consolidated Financial Statements

    2.  Financial Statement Schedules.

 
    3.  Exhibits

        3.1    Amended Certificate of Incorporation of the Registrant filed
               with the Delaware Secretary of State

        3.2    Amended and Restated Bylaws of the Registrant

 
 (b) Reports on form 8-K

The Registrant filed a Form 8-K as of September 9, 1997, wherein it reported
that Mr. Simon Gu was elected as a member of the Board of Directors.
 
The Registrant filed a Form 8-K as of September 18, 1997, wherein it reported
that the Company issued 6 million shares of common stock to Rightiming
Electronics Corp. in exchange for its 6 million shares of common stock of
Regent Electronics Corp. 

 The Registrant filed a Form 8-K as of March 4, 1998, wherein it reported
that H&Q Asia Pacific and Asia Pacific Growth Fund II invested $6 million to
acquire 1.5 million shares of preferred stock of Regent Electronics Corp.,
a subsidiary of the Company.
 
 The Registrant filed a Form 8-K as of March 6, 1998, wherein it reported
that the Company created a new, wholly owned subsidiary, LPF International
Corp., in order to control and expand its existing textile business
worldwide. Richtime Far East Ltd. became an indirect subsidiary of the
Company.





                  LOTUS PACIFIC, INC. AND SUBSIDIARIES
                    CONSOLIDATED FINANCIAL STATEMENTS
               FOR THE YEARS ENDED JUNE 30, 1998 AND 1997


                       

                        INDEPENDENT AUDITOR'S REPORT



To the Board of Directors and Stockholders
of Lotus Pacific, Inc. and Subsidiaries

We have audited the accompanying balance sheets of Lotus pacific, Inc. and
Subsidiaries as of June 30, 1998 and 1997 and the related statements of
operations, stockholders' equity, and cash flows for the years then ended.
These financial statements are the responsibility of the Company's
management.  Our responsibility is to express an opinion on these financial
statements based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by the 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 Lotus Pacific, Inc. and
Subsidiaries as of June 30, 1998 and 1997, and the results of its operations
and its cash flows for the years then ended in conformity with generally
accepted accounting principles.


/s/

Schffman Hughes Brown
Blue Bell, Pennsylvania
September 4, 1998




790 PENLLYN PIKE, SUITE 302
BLUE BELL, PENNSYLVANIA 19422
(215) 646-2000  FAX (215) 646-1937




               LOTUS PACIFIC, INC. AND SUBSIDIARIES
                    CONSOLIDATED BALANCE SHEETS
                       JUNE 30, 1998 AND 1997


                                 ASSETS
                                          1998              1997
Current Assets:
 Cash                                  $3,193,127          $268,679
 Accounts Receivable                    4,979,759
 Prepaid Expenses                         760,295
 Advances                               _________             2,354     
  Total current assets                  8,933,181           271,033             

Investments (Note 5)                      600,000           600,000

Property and equipments:
 Furniture and office equipment            90,192            90,000
 Equipment                              1,541,231         1,502,120
 Leasehold improvements                    75,612             1,041
                                         1,707,015        1,593,161

 Less: accumulated depreciation           348,286            26,623
                                        1,358,729         1,566,538

Other assets:
 Intangible asset, net of
 accumulated amortization of
 $370,477 and $28,480 in 1998
 and 1997, respectively                 5,439,523         5,781,520

 Deposit                                   72,792             1,700
                                        5,512,315         5,783,220

                                      $16,404,225        $8,220,791


                       LIABILITY AND STOCKHOLDERS' EQUITY

Current liabilities:
 Account payable                       $1,755,654           $14,946
 Loan Payable (Note 3)                    120,000
 Salaries Payable                          63,819                  
 Payroll taxes payable                     32,234            25,771
 Income taxes payable (Note 6)             42,110           123,392
  Total current liabilities             2,013,817           164,109

Minority interest in
 subsidiary (Note 5)                    6,569,544         2,317,815

Stockholders' equity:
 Common stock (Note 8)                     47,387            40,737
 Preferred stock, Series A (Note 8)             4                 4
 Common Stock Warrant (Note 8)             80,000
 Additional paid-in capital            10,240,740         6,188,348         
 Accumulated deficit                   (2,547,267)         (490,222)
                                         7,820,864         5,738,867

                                       $16,404,225        $8,220,791

    See independent auditor's report and notes to financial statements 
 




                    LOTUS PACIFIC, INC. AND SUBSIDIARY
                  CONSOLIDATED STATEMENTS OF OPERATIONS
                FOR THE YEARS ENDED JUNE 30, 1998 AND 1997


                                                          
                                       1998               1997

Sales                               $10,998,875          $ - 0 -
Cost of Sales                         7,989,318
Gross Profit                          3,009,557     

Operating expenses                    4,933,919          310,241

Operating loss                       (1,924,362)       (310,241)

Other income (expenses):
  Interest income                        33,675           11,186
  Research and development           (2,264,801)        (14,703)
  Gain on sale of investment                             398,805
  Royalty Income                      1,800,000               
                                       (431,126)         395,288

Net income (loss) before income taxes
 and minority interest in income
 of consolidated subsidiaries        (2,355,488)          85,047

Income tax benefit (expenses)
 (Note 6)                                 80,714       (123,842)

Minority interest in loss of 
 consolidated subsidiaries               217,729          82,185  

Net income                          $(2,057,045)         $43,390

Earnings per share
  Basic                                   $(.05)            $.00
  Diluted                                 $(.05)            $.00 

Weighted average shares               44,421,334      29,238,081 
 


  See independent auditor's report and notes to financial statements



                  LOTUS PACIFIC, INC. AND SUBSIDIARIES
        CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
               FOR THE YEARS ENDED IN JUNE 30, 1998 AND 1997



          Common      Preferred    Common         Additional
          Shares       Shares      Stock            Paid-in
        Outstanding  Outstanding  Warrants  Amount  Capital  Deficit  Total


Balance
 June 30, 1996

       26,937,054      4,300               $26,941 $892,148 $(533,612)$385,477

Issuance of 
  common stock

        13,800,00                           13,800 5,296,200        5,310,000

Net income for
 the year ended
 June 30, 1997
        _______       _______    ______     ______     _______ 43,390  43,390


Balance
 June 30, 1997

      40,737,054     4,300             $40,741$6,188,348 $(490,222)$5,738,867
 
Issuance of 
 common stock

      536,000                                  536 2,071,464        2,072,000

Issuance of
 Common stock
 For services

      113,750                                  114   454,886          455,000

Issuance of
 Common Stock
 For purchase
 Of subsidiary

    6,000,000                                6,000  1,526,042       1,532,042

Issuance of Common
 Stock Warrants 

                                 8,000,000  80,000                     80,000

Net loss for the year
 ended June 30, 1998

   _________        ________     _______ _____  _____  2,057,045) (2,057,045)
   
Balance
 June 30, 1998

   47,386,804  4,300  8,000,000  $127,391 $10,240,740 $(2,547,267) $7,820,864




       See independent auditor's report and notes to financial statements




                     LOTUS PACIFIC, INC. AND SUBSIDIARY
                   CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE YEARS ENDED JUNE 30, 1998 AND 1997

                                                     1998          1997
Cash flows from operating activities:
 Net income (loss)                             $(2,057,045)      $43,390
 Adjustments to reconcile income (loss) to
 net cash provided by operating activities:
  Depreciation and amortization                    663,660        55,103
  Common stock issued for services                 455,000
  Gain on sale of investment                                   (398,805) 
 Changes in assets and liabilities:
  Increase in accounts receivable               (4,979,759)
  Increase in prepaid expenses                    (760,295)      
  Increase (decrease) in advances                     2,354      (2,354)
  Increase in deposit                              (71,092)      (1,700)
  Increase in accounts payable                    1,740,708       14,946
  Increase in payroll taxes payable                   6,463       25,771
  Increase in salaries payable                       63,819
  Increase (decrease) in income tax payable        (81,282)      123,392 
  Increase in minority interest in subsidiary     5,783,771    2,317,815
Net cash provided by
 (used in) operating activities                     766,302    2,177,558

Cash flows from investing activities:
  Purchase of property and equipment              (113,854)  (1,593,161)  
  Purchase of intangible asset                               (5,810,000)
Net cash used in investing activities             (113,854)  (7,403,161)

Cash flows from financing activities:
  Issuance of common stock                        2,072,000    5,310,000
  Issuance of common stock warrants                  80,000
  Increase in loans payable                         120,000
  Proceeds from sale of investment                               571,200
  Acquisition of investment                                    (600,000) 
Net cash provided by
  financing activities                            2,272,000    5,281,200

Net cash increase in cash                         2,924,448       55,597

Cash, beginning                                     268,679      213,082

Cash, ending                                     $3,193,127     $268,679 

Supplemental disclosure of cash flow information:

 Cash paid for taxes                                   $500         $150

Supplemental disclosure of non-cash financing activities:

 Issuance of common stock for services             $455,000

 Issuance of common stock for
   purchase of subsidiary                        $1,532,042


  
     See independent auditor's report and notes to financial statements



                     LOTUS PACIFIC, INC. AND SUBSIDIARIES
                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                          JUNE 30, 1998 AND 1997


1.     Description of business:

Lotus Pacific, Inc. (the "Company") is a holding company and its main
business is conducted through its two subsidiaries: Regent Electronics Corp.
("Regent") and LPF International Corp. ("LPF").

Regent is a New Jersey based cybetech corporation. Regent generates its
income from granting technology patent and licenses to manufactures and from
selling products to China or its neighboring countries through a combination
of direct sales, under reseal agreement, or through distribution channels,
such as governmental authorities and local cable TV stations. The Company
owns 87.3% of Regent's equity interest.

LPF International Corp., a newly formed and wholly owned subsidiary of the
Company, was incorporated in the State of Delaware in February 1998 and
operates in New York City, NY. The formation of this new subsidiary in the
United States is part of the Company's business strategy to develop the
Company's textile and apparel business worldwide.

In January 1997, the Company set up a wholly owned subsidiary, Richtime Far
East, Ltd. (a Hong Kong corporation operated in Hong Kong). The Company is
continuing to investigate business opportunities.

2. Summary of significant accounting policies:

Principle of Consolidation:

The accompanying financial statements include the accounts of Lotus Pacific,
Inc.; its 87.3% owned subsidiary, Regent Electronics Corp.; and its wholly
owned subsidiary, LPF International Corp.   The 12.7% non-owned portion of
Regent Electronics Corp. appear as minority interest in subsidiary on the
balance sheet in accordance with generally accepted accounting principles.
All intercompany transactions have been eliminated in consolidation.

Cash and Cash Equivalents:

For purposes of reporting cash flows, the Company considers all cash accounts
that are not subject to withdrawal restrictions or penalties to be cash or
cash equivalents.

Accounts Receivable:

The allowance for doubtful accounts is based on management's evaluation of
outstanding accounts receivable at the end of the year. No allowance for
doubtful accounts has been provided, since management believes all accounts
are collectable.

Equipment and Depreciation:

Property and equipment are stated at cost.  Depreciation is calculated using
the straight-line method over their estimated useful lives from 3 to 40
years. Depreciation expense for the years ended June 30, 1998 and 1997 was
$321,896 and $26,623, respectively.

Intangible Asset:

Intangible asset consists of the acquisition of patents by the Company in
June 1997. The patents are carried at cost and amortized over the useful
life of 17 years.

Research and Development:

Research and development costs consist of expenditures incurred by the
Company during the course of planned search and investigation aimed at the
discovery of new knowledge that will be used to develop and improve its
Internet access product.  The Company expenses all such research and
development costs as they are incurred.

Income Taxes:

Income taxes are provided for the tax effects of transactions reported in
the financial statements and consist of taxes currently due plus deferred
taxes related primarily to differences between the basis of balance sheet
items for financial and income tax reporting.  There is no difference
between the basis for financial and income reporting.

Investment in Unconsolidated Subsidiary:

The Company recorded its investment in Richtime Far East, Ltd. (a Hong Kong
company) at cost.

Use of Estimates:

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions
that affect certain reported amounts and disclosures. Accordingly, actual
results could differ from those estimates.

Concentration of Credit Risk:

The Company occasionally maintains deposits in excess of federally insured
limits. The risk is managed by maintaining all deposits in high quality
financial institutions.

Earnings Per Share:

Primary earnings per share are computed by dividing net income (loss) by the
weighted average number of shares of common stock and equivalent number of
common shares of convertible preferred stock. Fully diluted earnings per
share reflect the dilutuive effect of stock options and warrants. For the
year ended June 30, 1998, the computation of fully diluted loss per share was
antidilutive; therefore, the amounts reported for primary and fully dilutive
loss per share were the same.

3. Loans Payable:

Represents money deposited with the Company in June 1998 from a potential
investor who has requested their money back. The $120,000 was refunded to
them in July 1998.

4. Issuance of Stock:

During the year ended June 30, 1998, the Company issued an aggregate of
6,649,750 shares of its common stock. 536,000 shares of common stock were
issued for cash consideration of $2,072,000, 113,750 shares of common stock
were issued for consulting services, and 6,000,000 shares of common stock
were issued to purchase at book value, $1,532,042, an additional 17% interest
in Regent Electronics Corp.

During the year ended June 30, 1997, the Company issued 13,800,000 shares
of its common stock for aggregate cash consideration of $5,310,000.

5. Acquisitions and Dispositions:

Shanghai Union Auto Bicycle Co., Ltd.:

On September 25, 1995 the Company exchanged 560,000 shares of its common
stock for a seventy percent equity interest in Shanghai Union (Shanghai
Union) Auto Bicycle Co., Ltd. in Shanghai, People's Republic of China.  At
September 25, 1995 Shanghai Union had stockholder's equity of $ 204,721,
70% thereof was $143,305.

On June 28, 1996 the Company exchanged its investment in Shanghai Union for
5% of the outstanding common stock of Rightiming Electronics Corp.
(Rightiming). Rightiming was incorporated on January 4, 1996 to design and
manufacture electronic software and other products to be marketed in the Far
East. Five percent of Rightiming's stockholder's equity was $268,018 upon the
date of acquisition.  The Company recorded its investment in Rightiming at
the value of its investment in Shanghai Union, on the date of the exchange,
$172,395. On May 6, 1997, the Company sold its 5% interest in Rightiming
Electronics Corp. for $571,200.


Regent Electronics Corp.:

In April and May 1997, the Company also acquired 70% of the common stock
of Regent Electronics corp. for $5,388,000. In September 1997, the Company
purchased an additional 17% of the common stock of Regent Electronics Corp.
through the issuance of 6,000,000 shares of common stock. Regent Electronics
Corp. was incorporated to manufacture electronic Interest access equipment
and software to be marketed and sold in the Far East. The accounts of Regent
Electronics Corp. are consolidated with the parents (Lotus Pacific, Inc.)
accounts.

LPF International Corp.:

In February 1998, the Company acquired 100% of the common stock of LPF
International Corp. for $1,300,000. LPF International Corp. was incorporated
to be a fashion designer and a broker in the worldwide textile and apparel
business. The accounts of LPF International Corp. are consolidated with the
parent's (Lotus Pacific, Inc.) accounts.

Richtime Far East, Ltd.:

In April 1997, the Company acquired 100% of the stock of Richtime Far East,
Ltd. (a Hong Kong corporation) for monetary consideration of $600,000. The
management of Lotus Pacific, Inc. has limited operational input upon the
operations of Richtime Far East, Ltd. and carries the investment at cost.
Richtime Far East, Ltd. is not consolidated with Lotus Pacific, Inc. in
accordance with generally accepted accounting principles.

Pertinent financial information for Richtime Far East, Ltd. is as follows:


                             1998                     1997
                           Unaudited                Unaudited

  Sales                   $5,699,495               $1,990,480
  Gross Profit              $587,095                 $213,717
  Net Income                $475,725                 $177,742

6. Income Taxes:

Income taxes for years ended June 30, 1998 and 1997 consisted of the
following:

                             1998                      1997

  Current:
    Federal                $(61,917)                  $92,120 
    State                   (18,797)                   31,722
                                        
                           $(80,714)                 $123,842 
       

7. Financial Instrument:

Cash accounts are secured by the Federal Deposit Insurance Corporation up to
$100,000.  At June 30, 1998 and June 30, 1997, the uninsured balance was
$2.743,480 and $56,199 respectively.

8. Capital Stock:

Common stock - $.001 par value, 60,000,000 shares authorized, 47,387,644 and
40,737,894 shares issued and outstanding in 1998 and 1997, respectively.

Preferred stock, Series A - $.001 par value, 100,000 shares authorized,
4,300 shares issued and outstanding in 1998 and 1997.

Common stock warrants - 8,000,000 warrants issued and outstanding. Each
warrant entitled the holder to purchase one share of the Company's common
stock at $3.00 per share. Warrants expire May 5, 2002. As of June 30, 1998,
no warrants have been exercised.

Significant customers:

For the year ended June 30, 1998, the Company had four customers with
billings in excess of 10% of total revenues. These two customers accounted
for approximately 70% of total revenues.


10. Condensed Financial Statements for Regent Electronics Corp. at
    June 30, 1998 and 1997:


                              BALANCE SHEET
 

                                           1998              1997
                               ASSETS

Current assets                           $7,232,436        $205,035
Property and equipment                    1,281,029       1,564,334
Other assets                              5,461,930       5,783,220 

                                        $13,975,395      $7,552,589 
        

                  LIABILITIES AND STOCKHOLDERS' DEFICIT


Current liabilities                      $2,134,683         $38,539

Stockholders' deficit:
 Common stock                                26,000          26,000
 Preferred stock                              1,500
 Stock warrants                               1,500       
 Additional paid-in capital              13,760,500       7,762,000
 Accumulated deficit                    (1,948,788)       (273,950)
                                         11,840,712       7,514,050 

                                        $13,975,395      $7,552,589



                             STATEMENT OF OPERATIONS


Sales                                    $6,155,000
Cost of sales                           (3,408,500)      
Interest income                              30,535          $2,563
Royalty income                            1,800,000
Operating costs and expenses            (6,251,873)       (276,513)

Net Loss                               $(1,674,838)      $(273,950)



                             STATEMENT OF CASH FLOWS


Cash flows used
 in operating activities               $(3,914,716)      $(235,411)

Cash flows used
 in investing activities                   (38,083)     (7,347,554)

Cash flows from
 financing activities                     6,436,500       7,788,000

Net increase in cash                     $2,483,701        $205,035




                       LOTUS PACIFIC, INC. AND SUBSIDIARIES
               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                              JUNE 30, 1998 AND 1997


10. Condensed Financial Statements for LPF International Corp.
    at June 30, 1998:

                               BALANCE SHEET 

                                  ASSETS


Current assets                                  $1,435,933                
Property and equipment                              75,603                
Other assets                                        50,617 
                                                $1,562,153 

                 LIABILITIES AND STOCKHOLDERS' DEFICIT

Current liabilities                               $171,962                   

Stockholders' deficit:
 Common stock                                    1,300,000   
 Retained earnings                                  90,191               
                                                 1,390,191 

                                                $1,562,153 

          

                        STATEMENT OF OPERATIONS

Sales                                           $4,843,940
Cost of sales                                  (4,580,823)      
Interest income                                         67                  
Operating costs and expenses                     (172,993)              

Net income                                         $90,191

           

                        STATEMENT OF CASH FLOWS


Cash flows used
 in operating activities                        $(984,919)
            
Cash flows used
 in investing activities                          (75,603)
 
Cash flows from
 financing activities                            1,300,000             

Net increase in cash                              $239,578            









                            Signatures



Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the registrant had duly caused this registration statement to be
signed on its behalf by the undersigned, thereto duly authorized.



Date: September 29, 1998          Lotus Pacific, Inc.
                                          
                    
                                  /S/  James Yao

                                  James Yao, Chairman & President

      
Pursuant to the requirements of the Securities Exchange Act 1934, this report
has been signed below by the following persons on behalf of the registrants
and in capacities and on the dates indicated.


                           /S/   David Leung
                           David Leung, Director & Vice President

                           /S/   James Liu
                           James Liu, Director & Vice President

                           /S/   Jeremy Wang
                           Jeremy Wang, Director 

                           /S/ Simon Gu
                           Simon Gu, Director

                           /S/  Gary Huang
                           Gary Huang, Secretary, Treasurer & Director








Exhibits 3.1

                        CERTIFICATE OF AMENDMENT
          OF CERTIFICATE OF INCORPORATION
OF LOTUS PACIFIC, INC.


 LOTUS PACIFIC, INC., a corporation organized and existing under and by
virtue of the General Corporation Law of the State of Delaware, DOES HEREBY
CERTIFY:

 FIRST: That the Board of Directors of said corporation at a meeting only
convened and held, adopted the following resolution:

 RESOLVED that the Board of Directors hereby declared it advisable and in
the best interest of the Company that Article Fourth of the Certificate of
Incorporation be amended to read as follows:

 FOURTH: The total number of shares of stock which this Corporation is
authorized to issue is:

 Sixty Million (60,000,000) shares of Common Stock with a par value of One
Mil ($.001) per share, One Hundred Thousand (100,000) shares of Preferred
Stock with a par value of One Mil ($.001) per share and Four Thousand Three
Hundred (4,300) shares of Preferred Class A Stock with a par value of One
Mil ($.001) per share.

 SECOND: That the said amendment has been consented to and authorized by the
holders of a majority of the issued and outstanding stock entitled to vote
by written consent given in accordance with the previsions of Section 228 of
the General Corporation law of the State of Delaware.

 THIRD: That the aforesaid amendment was duly adopted in accordance with the
applicable provisions of Sections 242 and 228 of the General Corporation Law
of the State of Delaware.

 IN WITNESS WHEREOF, said corporation has caused this Certificate to be
signed by James Yao this fifteenth day of June A.D. 1998.

     

                                /S/ James Yao
                                ____________________________ 
                                James Yao, President & Chairman 









Exhibit 3.2


                               BYLAWS 
                                 OF 
                         LOTUS PACIFIC, INC.
                       (a Delaware corporation)



                             ARTICLE I

                              OFFICES

 The principal office of the Corporation shall be located in 200 Centennial
Avenue, Suite 201, Piscataway, NJ 08854. The Corporation may have such other
offices, either within or without the State New Jersey, as the Board of
Directors may designate or as the business of the Corporation may require
from time to time.


                            ARTICLE II

                           SHAREHOLDERS

 SECTION 1. Annual Meeting. The annual meeting of the shareholders shall be
held on the second day in the month of December in each year, beginning with
the year 1998, at the hour of 2 p.m., for the purpose of electing Directors
and for the transaction of such other business as may come before the
meeting. If the election of Directors shall not be held on the day designated
herein for any annual meeting of the shareholders, or at any adjournment
thereof, the Board of Directors shall cause the election to be held at a
special meeting of the shareholders as soon as thereafter as conveniently
may be.

 SECTION 2. Special Meeting. Special meeting of the shareholders, for any
purpose or purposes, unless otherwise prescribed by statute, may be called
by the President or by the Board of Directors, and shall be called by the
President at the request of the holders of not less than fifty one percent
( 51%) of all the outstanding share of the Corporation entitled to vote at
the meeting.

 SECTION 3. Place of Meeting. The Board of Directors may designate any place,
either within or without the State of New Jersey, unless otherwise prescribed
by statute, as the place of meeting for any annual meeting or for any special
meeting. A waiver of notice signed by all shareholders entitled to vote at a
meeting may designate any place, either within or without the State of New
Jersey, unless otherwise prescribed by statute, as the place for the holding
of such meeting. If no designation is made, the place of meeting shall be the
principal office of the Corporation.

 SECTION 4. Notice of Meeting. Written notice stating, day and hour of the
meeting and, in case of a special meeting, the purpose or purposes for which
the meeting is called, shall unless otherwise prescribed by statute, be
delivered not less than 10 days, nor more than 60 days before the date of the
meeting, to each shareholder of record entitled to vote at such meeting. If
mailed, such notice shall be deemed to be delivered when deposited in the
United States, addresses to the shareholder at his address as it appears on
the stock transfer books of the Corporation, with postage thereon prepaid.

 SECTION 5. Waiver of Notice. Notice need not be given to any stockholder who
submits a written waiver of notice signed by him before or after the time
stated therein. Attendance of a stockholder at a meeting of stockholders
shall constitute a waiver of notice of such meeting, except when the
stockholder attends the meeting for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business because the
meeting is not lawfully called or convened. Neither the business to be
transacted at, nor the purpose of, any regular or special meeting of the
stockholders need be specified in any written waiver of notice.

 SECTION 6. Closing of Transfer Books or Fixing of Record. For the purpose
of determining shareholders entitled to notice of or to vote at any meeting
of shareholders or any adjournment thereof, or shareholders entitled to
receive payment of any dividend , or  in order to make a determination of
shareholders for any other proper purpose, the Board of Directors of the
Corporation may provide that the stock transfer books shall be closed for
a stated period, but not to exceed in any case fifty (50) days. If the
stock transfer books shall be closed for the purpose of determining
shareholders entitled to notice of or to vote at a meeting of shareholders,
such books shall be closed for at least 21 days immediately preceding such
meeting. In lieu of closing the stock transfer books, the Board of Directors
may fix in advance a date as the record date for any such determination of
shareholders, such date in any case to be not more than 50 days and, in case
of a meeting of shareholders, not less than 30 days, prior to the date on
which the particular action requiring such determination of shareholders is
to be taken. If the stock transfer books are not closed and no record date
is fixed for the determination of shareholders entitled to notice or to vote
at a meeting of shareholders, or shareholders entitled to receive payment
of a dividend, the date on which notice of the meeting is mailed or the date
on which the resolution of the Board of Directors declaring such dividend is
adopted, as the case may be, shall be the record date for such determination
of shareholders. When a determination of shareholders entitled to vote at
any meeting of shareholders has been made as provided in this section, such
determination shall apply to any adjournment thereof.

 SECTION 7. Stockholder List. The officer or agent having charge of the stock
transfer books for shares of the corporation shall make a complete list of
the shareholders entitled to vote at each meeting of shareholders or any
adjournment thereof, arranged in alphabetical order, with the address of and
the number of shares held by each. Such list shall be produced and kept open
at the time and place of the meeting and shall be subject to the inspection
of any shareholder during the whole time of the meeting for the purposes
thereof.

 The stock ledger shall be the only evidence as to who are the stockholders
entitled to examine the stock ledger, the list required by this section or
the books of the Corporation, or to vote at any meeting of stockholders.

 SECTION 8. Conduct of Meeting. Meetings of the stockholders shall be
presided over by one of the following officers in the order of seniority
and if present and acting, the Chairman of the Board, if any, the Vice
Chairman of the Board, if any, the President, a Vice President, or if none
of the foregoing is in officer and present and acting, by a chairman to be
chosen by the stockholders. The Secretary of the Corporation shall act as
secretary of every meeting, but if the Secretary is not present, the Chairman
of the meeting shall appoint a secretary of the meeting.

 SECTION 9. Quorum. A majority of the outstanding shares of the Corporation
entitled to vote, represented in person or by proxy, shall constitute a
quorum at a meeting of shareholders. If less than a majority of the
outstanding shares are represented at a meeting, a majority of the shares
so represented may adjourn the meeting from time to time without further
notice. At such adjourned meeting at which a quorum shall be present or
represented, any business may be transacted which might have been transacted
at the meeting as originally noticed. The shareholders present at a duly
organized meeting may continue to transact business until adjournment,
notwithstanding the withdrawal of enough shareholders to leave less than
a quorum.

 SECTION 10. Proxy Representation. Every stockholder may authorize another
person or persons to act for him by proxy in all matters in which a
stockholder is entitled to participate, whether by waiving notice of any
meeting, voting or participating at a meeting, or expressing consent or
dissent without a meeting.  Every proxy must be signed by the stockholder
or by his attorney-in-fact. NO proxy shall be voted or acted upon after three
years from its date unless such proxy provides for a longer period.  A duly
executed proxy shall be irrevocable if it states that it is irrevocable and,
if, and only as long as, it is coupled with an interest sufficient in law to
support an irrevocable power. A proxy may be made irrevocable regardless of
whether the interest with which it is coupled is an interest in the stock
itself or an interest in the Corporation generally. Such proxy shall be filed
with the Secretary of the Corporation before or at the time of the meeting. 

 A meeting of the Board of Directors may be had by means of a telephone
conference or similar communications equipment by which all persons
participating in the meeting can hear each other, and participation in a
meeting under such circumstances shall constitute presence at the meeting.

 SECTION 11. Voting of Shares. Each outstanding share entitled to vote shall
be entitled to one upon each matter submitted to a vote at a meeting of 
shareholders. Directors shall be elected by a plurality of the votes of the
shares present in person or represented by proxy at the meeting and entitled
to vote on the election of directors. Any other action shall be authorized by
a majority of the votes cast except where the General Corporation Law 
prescribes a different percentage of votes and/or a different exercise of
voting power, and except as may be otherwise prescribed by the provisions of
the certificate of incorporation and these Bylaws. In the election of
directors, and for any other action, voting need not be ballot.

 SECTION 12. Voting of Shares by Certain Holders. Shares standing in the
name of another corporation may be voted by such officer, agent or proxy as
the Bylaws of such corporation may prescribe or, in the absence of such
provision, as the Board of Directors of such corporation may determine.

 Shares held by an administrator, executor, guardian or conservator may be
voted by him either in person or by proxy, without a transfer of such shares
into his name. Shares standing in the name of a trustee may be voted by him,
either in person or by proxy, but no trustee shall be entitled to vote shares
held by him without a transfer of such shares into his name.

 Shares standing in the name of a receiver may be voted by such receiver, and
shares held by or under the control of a receiver may be voted by such
receiver without the transfer thereof into his name, if authority to do so 
be contained in an appropriate order of the court by which such receiver was
appointed.

 A shareholder whose shares are pledged shall be entitled to vote such shares
until the shares have been transferred into the name of the pledge, and
thereafter the pledge shall be entitled to vote the shares so transferred.

 Shares of its own stock belonging to the Corporation shall not be voted
directly or indirectly, at any meeting, and shall not be counted in
determining the total number of outstanding shares at any given time.

 SECTION 13. Stockholder Action without Meeting.  Any action required
to be taken at a meeting of the shareholders, or any other action which may
be taken at a meeting of the shareholders, may be taken without a meeting,
without prior notice and without a vote, upon the written consent of not less
than fifty one percent (51%) of the shareholders who would have been entitled
to cast their votes to authorize the action at a meeting at which all
shareholders entitled to vote thereon were present and voting.


                             ARTICLE III

                         BOARD OF DIRECTORS


 SECTION 1. General Powers. The business and affairs of the Corporation
shall be managed by or under the direction of the Board of Directors of the
Corporation. The Board of Directors shall have the authority to fix the
compensation of the members thereof. The use of the phrase "whole board"
herein refers to the total number of directors which the Corporation would
have if there were no vacancies.

 SECTION 2. Qualifications and Number. A director need not to be stockholder
or a citizen of the United States. The initial Board of Directors shall
consist of two( 2 ) persons. Thereafter the number of directors constituting
the whole board shall be at least one. Subject to the foregoing limitation
and except for the first Board of Directors, such number may be fixed from
time to time by action of the stockholders or  of the directors. The number
of directors may be increased or decreased by action of the shareholders or
of the directors. 

 SECTION 3. Election and Term. The first Board of Directors, unless the
members thereof shall have been named in the certificate of incorporation,
shall be elected by the incorporator or incorporators and shall hold office
until the first annual meeting of stockholders and until their successor are
elected and qualified or until their earlier resignation or removal. Any
director may resign at any time upon written notice to the Corporation.
Thereafter, directors who are elected at an annual meeting of stockholders,
and directors who are elected in the interim to fill vacancies and newly
created directorships, shall hold office until the next annual meeting of
stockholders and until their successors are elected and qualified or until
their earlier resignation or removal. Except as the General Corporation Law
may otherwise require, in the interim between annual meetings of shareholders
or of special meetings of shareholders called for the election of directors
and/or for the removal of one or more directors and for the filling of any
vacancy in that connection, newly created directorships and any vacancies
in the Board of Directors, including unfilled vacancies resulting from the
removal of directors for cause or without cause, may be filled by the vote
of a majority of the remaining directors then in office, although less than
a quorum, or by the sole remaining director.

 SECTION 4. Regular Meeting. A regular meeting of the Board of Directors
shall be held without other notice than this Bylaw immediately after, and
at the same place as, the annual meeting of shareholders. The Board of
Directors may provide, by resolutions, the time and place for the holding
of additional regular meetings without notice other than such resolution.

 SECTION 5. Special Meetings. Special meetings of the Board of Directors may
be called by or at the request of the President or any two directors. The
person or persons authorized to call special meetings of the Board of
Directors may fix the place for holding any special meeting of the Board
of Directors called by them.

 SECTION 6. Notice or Constructive Waiver. No notice shall be required for
regular meetings for which the time and place have been fixed. Written,
oral, or any other mode of notice of the time and place shall be given 
for special meetings in sufficient time for the convenient assembly of the
directors thereat. Notice need not be given to any director who submits
a written waiver of notice signed by him before or after the time stated
therein. Attendance of any such person at a meeting shall constitute a
waiver of notice of such meeting, except when he attends a meeting for
the express purpose of objecting, at the beginning of the meeting, to the
transaction of any business because the meeting is not lawfully called or
convened. Neither the business to be transacted at, nor the purpose of,
any regular or special meeting of the directors need be specified in any
written waiver of notice.

 SECTION 7. Quorum. A majority of the whole Board shall constitute a
quorum for the transaction of business at any meeting of the Board of
Directors, but if less than such majority is present at a meeting, a
majority of the directors present may adjourn the meeting from time to
time without further notice.

 Any member or members of the Board of Directors or of any committee
designated by the Board, may participate in a meeting of the Board, or any
such committee, as the case may be, by means of conference telephone or
similar communications equipment by means of which all persons participating
in the meeting can hear each other.

 SECTION 8. Manner of Acting. The act of the majority of the directors
present at a meeting at which a quorum is present shall be act of the Board
of Directors.

 SECTION 9. Action Without a Meeting. Any action that may be taken by the
Board of Directors at a meeting may be taken without a meeting if a consent
in writing, setting forth the action so to be taken, shall be signed before
such action by all the directors.

 SECTION 10. Compensation. By resolution of the Board of Directors, each
director may be paid his expenses, if any, of attendance at each meeting 
of the Board of Directors, and may be paid a stated salary as a director or
a fixed sum for attendance at each meeting of the Board of Directors or both.
No such payment shall preclude any director from serving the Corporation in
any other capacity and receiving compensation therefor.

 SECTION 11. Presumption of Assent. A director of the Corporation who is
present at a meeting of the Board of Directors at which action on any
corporate matter is taken shall be presumed to have assented to the action
taken unless his dissent shall be entered in the minutes of the meeting or
unless he shall file his written dissent to such action with the person
acting the Secretary of the meeting before the adjournment thereof, or shall
forward such dissent by registered mail to the Secretary of the Corporation
immediately after the adjournment of the meeting. Such right to dissent
shall not apply to a director who vote in favor of such action.

 SECTION 12. Removal of Directors.  Except as may otherwise be provided by
the General Corporation Law, any director or the entire Board of Directors
may be removed, with or without cause, by the holders of a majority of the
shares then entitled to vote at an election of directors.

 SECTION 13. Committees. The Board of Directors may, by resolution passed by
a majority of the whole Board, designate one or more committees, each
committee to consist of one or more of directors of the Corporation. The
Board may designate one or more directors as alternate members of any
committee, who may replace any absent or disqualified member at any meeting
of the committee. Any such committee, to the extent provided in the
resolution of the Board, shall have and may exercise the powers and authority
of the Board of Directors in the management of the business and affairs of
the Corporation with the exception of any authority the delegation of which
is prohibited by Section 141 of the General Corporation Law, and may
authorize the seal of the Corporation to be affixed to all papers which may
require it.


                                 ARTICLE IV

                                  OFFICERS
   
 SECTION 1. Number. The officers of the Corporation shall consist of a
President, a Secretary, a Chief Financial Officer or Treasurer, and, if
deemed necessary, expedient, or desirable by the Board of Directors, a
Chairman of the Board, a Vice-Chairman of the Board, one or more vice-
president, each of whom shall be elected by the Board of Directors. Such
other officers with such titles as the resolution of the Board of Directors
choosing them shall designate. Except as may otherwise be provided in the
resolution of the Board of Directors choosing him, no officer other than the
Chairman or Vice-Chairman of the Board, if any, need be a director.
 
 Any two or more offices may be held by the same person, as the directors
may determine, except for the offices of President and Secretary which may
not held by the same person. Officers may be directors or shareholders of
the Corporation.. Unless otherwise provided in the resolution choosing him,
each officer shall be chose for a term which shall continue the meeting of
the Board of Directors following the next annual meeting of stockholders
and until his successor shall have been chosen and qualified.

 SECTION 2. Election and Term of Office. The officers of the Corporation to
be elected by the Board of Directors shall be elected annually by the Board
of Directors at the first meeting of the Board of Directors held after each
annual meeting of the shareholders. If the election of officers shall not be
held at such meeting, such election shall be held as soon thereafter as 
conveniently may be. Each officer shall hold office until his successor shall
have been duly elected and shall have qualified, or until he hall resign or
shall have been removed in the manner hereinafter provided.

 SECTION 3. Removal. Any officer or agent may be removed by the Board of
Directors whenever, in its judgment, the best interests of the Corporation
will be served thereby, but such removal shall be without prejudice to the
contract rights, if any, of the person so removed. Election or appointment
of an officer or agent shall not of itself create contract rights, and such
appointment shall be terminable at will.

 SECTION 4. Vacancies. A vacancy in any office because of resignation,
removal, disqualification or otherwise, may be filled by the Board of
Directors for the unexpired portion of term.

 SECTION 5. President. The President shall be the principal executive officer
of the Corporation and, subject to the control of the Board of Directors,
shall in general supervise and control all of the business and affairs of the
Corporation. He shall, when present, preside at all meetings of the
shareholders and of the Board of Directors, unless there is a Chairman of the
Board, in which case the Chairman shall  preside. He may sign, with the
Secretary or any other proper officer of the Corporation thereunto authorized
by the Board of Directors, certificate for shares of the Corporation, any
deeds, mortgages, bonds, contracts, or other instruments which the Board of
Directors has authorized to be executed, except in case where the signing and
execution thereof shall be expressly delegated by the Board of Directors or
by these Bylaws to some other officer or agent of the Corporation, or shall
be required by law to be otherwise signed or executed; and in general shall
perform all duties incident to the office of President and such other duties
as may be prescribed by the Board of Directors from time to time.

 SECTION 6. Vice President. In the absence of the President or in event of
his inability or refusal to act, the Vice President shall perform the duties
of the President, and when so acting, shall have all the powers of and be
subject to all the restrictions upon the President. The vice president shall
perform such other duties as from time to time may be assigned to him by the
President or by the Board of Directors. If there is more than one Vice
President, each Vice President shall succeed to the duties of the President
in order of rank as determined by the Board of Directors. If no such rank
has been determined, then each Vice President shall succeed to the duties of
the President in order of date of election, the earliest date having the
first rank.

 SECTION 7. Secretary. The Secretary shall (a) keep the minutes of the
proceedings of the shareholders and of the Board of Directors in one or more
minute books provided for that purpose; (b) see that all notices are duly
given in accordance with the provisions of these Bylaws or as required by
law; (c) be custodian of the Corporation records and of the seal of the
Corporation and see that the seal of the Corporation is affixed to all
documents, the execution of which on behalf of the Corporation under its seal
is duly authorized; (d) keep a register of the post office address of each
shareholder which shall be furnished to the Secretary by such shareholder;
(e) sign with the President certificates for shares of the Corporation, the
issuance of which shall have been authorized by resolution of the Board of
Directors; (f) have general charge of the stock transfer books of the
Corporation; and (g) in general perform all duties incident to the office
of the Secretary and such other duties as from time to time may be assigned
to him by the President or by the Board of Directors.

 SECTION 8. Chief Financial Officer or Treasurer. The Chief Financial Officer
or Treasurer shall: (a) have charge and custody of and be responsible for all
funds and securities of the Corporation; (b) receive and give receipts for
moneys due and payable to the Corporation from any source whatever, and
deposit all such moneys in the name of the Corporation in such banks, trust
companies or other depositories as shall be selected in accordance with the
provisions of Article VI of these Bylaws; and (c) in general perform all of
the duties incident to the office of Treasurer and such other duties as from
time to time by the President or by the Board of Directors. If required by
the Board of Directors, the Chief Financial Officer or Treasurer shall give
a bond for the faithful discharge of his duties in such sum and with such
sureties as the Board of Directors shall determine.

 SECTION 9. Salaries. The salaries of the officers shall be fixed from time
to time by the Board of Directors, and no officer shall be prevented from
receiving such salary by reason of the fact that he is also a director of
the Corporation.


                                  ARTICLE V

                                  INDEMNITY

 The Corporation shall indemnify its directors, officers and employees as
follows:

 (a) Every director, officer, or employee of the Corporation shall be
indemnified by the Corporation against all expresses and liabilities,
including counsel fees, reasonably incurred by or imposed upon him in
connection with any proceeding to which he may become involved, by reason
of his being or having been a director, officer, employee or agent of the
Corporation or is or was serving at the request of the Corporation as a
director, officer, employee or agent of the Corporation, partnership, joint
venture, trust or enterprise, or any settlement thereof, whether or not he
is a director, officer, employee or agent at the time such expenses are
incurred, except in such cases wherein the director, officer, or employee
is adjudged guilty of willful misfeasance or malfeasance in the performance
of his duties; provided that in the event of a settlement the indemnification
herein shall apply only when the Board of Directors approves such settlement
and reimbursement as being for the best interests of the Corporation.

 (b) The Corporation shall provide to any person who is or was a director,
officer, employee, or agent of the Corporation or is or was serving at the
request of the Corporation as a director, officer, employee or agent of the
Corporation, partnership, joint venture, trust or enterprise, the indemnity
against expenses of suit, litigation or other proceedings which is
specifically permissible under applicable law.

 (c) The Board of Directors may, in its discretion, direct the purchase of
liability insurance by way of implementing the provisions of this Article V.


                               ARTICLE VI

                 CERTIFICATES FOR SHARES AND THEIR TRANSFER

 SECTION 1. Certificates for Shares. Certificates representing shares of the
Corporation shall be in such form as shall be determined by the Board of
Directors. Such certificates shall be signed by the President and by the
Secretary or by such other officers authorized by law and by the Board of
Directors so to do, and sealed with the corporate seal. The name and address
of the person to whom the shares represented thereby are issued, with the
number of shares and date of issue, shall be entered on the stock transfer
books of the Corporation. All certificates surrendered to the Corporation
for transfer shall be canceled and no new certificate shall be issued until
the former certificate for those shares shall have been surrendered and
canceled, except that in case of a lost, destroyed or mutilated certificate
a new one may be issued therefore upon such terms and indemnity to the
Corporation as the Board of Directors may prescribe.

 SECTION 2. Uncertificated Shares. Subject to any conditions imposed by
the General Corporation Law, the Board of Directors of the Corporation
may provided by resolution or resolutions that some or all of any or all
classes or series of the stock of the Corporation shall be uncertificated
shares. Within a reasonable time after the issuance or transfer of any
uncertificated shares, the Corporation shall send to the registered owner
thereof written notice prescribed by the General Corporation Law.

 SECTION 3. Transfer of Shares. Transfer of shares of the Corporation shall
be made only on the stock transfer books of the Corporation by the holder
of record thereof or by his legal representative, who shall furnish proper
evidence of authority to transfer, or by his attorney thereunto authorized
by power of attorney duly executed and filed with the Secretary of the
Corporation, and on surrender for cancellation of the certification for such
shares. The person in whose name shares stand on the books of the Corporation
shall be deemed by the corporation to be the owner thereof for all purposes.


                              ARTICLE VIII

                              FISCAL YEAR
 
 The fiscal year of the Corporation shall begin on the first day of July and
end on the 30th day of June of each year.


                             ARTICLE IX

CORPORATE SEAL

 The Board of Directors shall provide a corporate seal which shall be circular
in form and shall have inscribed thereon the name of the Corporation and the
state of incorporation and the words, Corporate Seal.


                             ARTICLE X

                          WAIVER OF NOTICE

 Unless otherwise provided by law, whenever any notice is required to be
given to any shareholder or director of the Corporation under the provisions
of these Bylaws or under the provisions of the Article of Incorporation or
under the provisions of the applicable Business Corporation Act, a waiver
thereof in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein, shall be deemed equivalent
to the giving of such notice.


                             ARTICLE XI

                             AMENDMENTS

 These Bylaws may be altered, amended or repealed and new Bylaws may be
adopted by the Board of Directors at any regular or special meeting of the
Board of Directors.

 The above Bylaws are certified to have been adopted by the Board of
Directors of the Corporation on the twenty fifth day of June, 1998.





                             ______________________________
                                   Corporate Secretary