SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D. C. 20459

                                    FORM 10-Q

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


For Quarter Ended September 30, 1998              Commission File Number  I-4383


                         ESPEY MFG. & ELECTRONICS CORP.
               (Exact name of registrant as specified in charter)

        NEW YORK                                         14-1387171
 (State of Incorporation)                      (I.R.S. Employer's Ident No.)


           233 Ballston Avenue,  Saratoga Springs,  New York      12866
           (Address of principal executive offices)             (Zip Code)



         Registrant's telephone number, include area code     518-584-4100


Number of shares  outstanding  of issuer's  class of common  stock  $.33-1/3 par
value as at the end of the period covered by this report 1,104,977
 
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed  by  Section  13 or 15 (d) of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for such shorter  period that the  registrant
was  required  to file such  reports),  and (2) has been  subject to such filing
requirements for the past 90 days.


                           YES   [ X ]      NO   [  ]
<PAGE>


                         ESPEY MFG. & ELECTRONICS CORP.

                                    I N D E X





PART I   FINANCIAL INFORMATION                                            PAGE
                                                                          ----

            Item 1   Financial Statements:


                              Balance Sheets - September 30, 1998           1
                              and June 30, 1998


                              Statements of Income - Three Months           3
                              Ended September 30, 1998 and 1997


                              Statements of Cash Flows - Three Months       4
                              Ended September 30, 1998 and 1997


                              Notes to Financial Statements                 5



            Item 2   Management's Discussion and Analysis of                7
                              Financial Condition and Results of
                              Operations.



PART II  OTHER INFORMATION                                                 10

                  SIGNATURES                                               11

<PAGE>
<TABLE>
<CAPTION>
                            ESPEY MFG. & ELECTRONICS CORP.
                                    Balance Sheets

                         September 30, 1998 and June 30, 1998

                                     A S S E T S

                                                          Unaudited
                                                             1998              1998
                                                         September 30         June 30
                                                        ------------      ------------
<S>                                                      <C>               <C>         
CURRENT ASSETS:

         Cash and cash equivalents .................     $    225,829      $    191,739
         Short-term investments at cost
            (market value September 30, 1998,
              $2,300,000 and June 30, 1998,
              $2,400,000) ..........................        2,300,000         2,400,000
                                                         ------------      ------------
                           Total Cash and Short-term
                                    Investments ....        2,525,829         2,591,739
                                                         ------------      ------------

         Investments securities ....................        7,235,749         7,235,749

         Trade accounts receivable net of
            $3,000 allowance at September 30, 1998
            and June 30, 1998 ......................        2,017,704         1,866,336
         Other receivables .........................          245,271           289,050
                                                         ------------      ------------

                           Net Receivables .........        2,262,975         2,155,386
                                                         ------------      ------------
         Inventories:

            Raw materials and supplies .............          399,137           558,951
            Work-in-process ........................        2,389,020         2,905,269
            Costs relating to contracts in
            process ................................        6,376,628         5,324,491
                                                         ------------      ------------

                           Net Inventories .........        9,164,785         8,788,711
                                                         ------------      ------------

         Deferred income taxes .....................          418,507           348,514
         Prepaid expenses and other current assets .           79,996           189,559
                                                         ------------      ------------

                           Total Current Assets ....       21,687,841        21,309,658
                                                         ------------      ------------
DEFERRED INCOME TAXES ..............................             --              80,793
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S>                                                      <C>               <C>         
PROPERTY, PLANT AND EQUIPMENT AT COST ..............       12,390,370        12,344,139

         Less: Accumulated depreciation and
               amortization ........................       (9,266,777)       (9,160,482)
                                                         ------------      ------------

                  Net Property, Plant and Equipment         3,123,593         3,183,657
                                                         ------------      ------------

                           Total Assets ............     $ 24,811,434      $ 24,574,108
                                                         ============      ============
                                                          
</TABLE>
                 See accompanying notes to financial statements

                                        - 1 -
<PAGE>
<TABLE>
<CAPTION>
                              ESPEY MFG. & ELECTRONICS CORP.
                                 Balance Sheets, Continued
                           September 30, 1998 and June 30, 1998

                           LIABILITIES AND STOCKHOLDERS' EQUITY

                                                             Unaudited
                                                                1998               1998
                                                            September 30         June 30
                                                           ------------      ------------
<S>                                                        <C>               <C>         
CURRENT LIABILITIES:
         Accounts Payable ............................     $    246,170      $    207,886
         Accrued expenses:
            Salaries, wages and commissions ..........          591,943           583,058
            Employees' insurance costs ...............           46,677            37,472
            ESOP payable .............................          139,666              --
            Other ....................................           17,619            12,204
            Payroll and other taxes withheld
                  and accrued ........................           82,591            43,360
                                                           ------------      ------------

                           TOTAL CURRENT LIABILITIES .        1,124,666           883,980

STOCKHOLDERS' EQUITY:
         Common stock, par value .33-1/3 per
         share.  Authorized 2,250,000 shares;
         issued 1,514,937 shares September 30, 1998
         and June 30, 1998  ..........................          504,979           504,979

         Unrealized gain on available-for-sale
         securities, net $3,740 of income tax ........            7,260             7,260

         Capital in excess of par value ..............       10,496,287        10,496,287

         Retained earnings ...........................       22,755,882        22,671,840
                                                          ------------      ------------
                                                             33,764,408        33,680,366

         Less:  Common stock subscribed ..............       (3,351,974)       (3,351,974)

                Cost of 409,960 shares on September
                30, 1998 and 403,717 on June 30,
                1998 of common stock in treasury .....       (6,725,666)       (6,638,264)
                                                           ------------      ------------

                  TOTAL STOCKHOLDERS' EQUITY .........       23,686,768        23,690,128
                                                           ------------      ------------

                  TOTAL LIABILITIES AND
                  STOCKHOLDERS' EQUITY ...............     $ 24,811,434      $ 24,574,108
                                                           ============      ============
</TABLE>
         See accompanying notes to financial statements


                                           - 2 -
<PAGE>
<TABLE>
<CAPTION>
                                 ESPEY MFG. & ELECTRONICS CORP.

                                      Statements of Income

                         Three Months Ended September 30, 1998 and 1997



                                                                          Unaudited
                                                                        Three Months
                                                             September 1998     September 1997 
                                                             --------------     --------------                        
<S>                                                             <C>               <C>            
Net Sales .................................................     $2,523,984        $2,503,584     
                                                                                                 
Cost of sales .............................................      2,125,279         2,074,981     
                                                                ----------        ----------     
                                                                                                 
                  GROSS PROFIT ............................        398,705           428,603     
                                                                                                 
Selling, general and administrative                                                              
         expenses .........................................        416,781           507,165     
                                                                ----------        ----------     
                                                                                                 
                  OPERATING LOSS ..........................        (18,076)          (78,562)    
                                                                ----------        ----------     
Other Income:                                                                                    
                                                                                                 
         Interest income ..................................        149,103           149,364     
         Sundry income ....................................             15             1,207     
                                                                ----------        ----------     
                                                                                                 
                                                                   149,118           150,571     
                                                                                                 
                                                                                                 
Income before income taxes ................................        131,042            72,009     
                                                                                                 
Provision for income taxes ................................         47,000            27,000     
                                                                ----------        ----------     
                                                                                                 
                                                                                                 
                  NET INCOME ..............................     $   84,042        $   45,009     
                                                                ==========        ==========     
                                                                                                 
Income per Share:                                                                                
                                                                                                 
Basic and dilutive income per share .......................     $      .08        $      .04     
                                                                ==========        ==========    
                                                                
Weighted average number of                                                                       
shares outstanding ........................................      1,110,474         1,111,220     
                                                                ==========        ==========    
                                                                                
</TABLE>
                 See accompanying notes to financial statements

                                      - 3 -
<PAGE>
<TABLE>
<CAPTION>
                                           ESPEY MFG. & ELECTRONICS CORP.
                                              Statements of Cash Flows
                                   Three Months Ended September 30, 1998 and 1997

                                                                                               Unaudited
                                                                                             September 30
                                                                                    ------------------------------
                                                                                        1998              1997
                                                                                    ------------      ------------
<S>                                                                                  <C>               <C>   
Cash Flows From Operating Activities:

         Net income ............................................................     $     84,042      $     45,009
 
         Adjustments  to reconcile  net income to net 
         cash provided by (used in) operating activities:

         Tax effect of dividends on unallocated ESOP shares ....................             --              39,084
         Depreciation ..........................................................          106,295           105,434
         Changes in assets and liabilities:
                  Increase in receivables ......................................         (107,589)         (512,475)
                  Increase in inventories ......................................         (376,074)         (562,634)
                  Decrease in other current assets .............................          109,563            61,915
                  Increase in accounts payable .................................           38,284            59,692
                  Increase in accrued salaries, wages and commissions ..........            8,885            47,670
                  Increase (decrease) in accrued employee insurance costs ......            9,205            (7,375)
                  Increase in other accrued expenses ...........................            5,415               893
                  Increase in payroll & other taxes withheld
                   and accrued .................................................           39,231            15,915
                  Decrease (increase) in deferred income taxes .................           10,800            (1,223)
                  Increase (decrease) in income taxes payable ..................             --             (80,861)
                  Increase in ESOP contributions payable .......................          139,666           113,926
                                                                                     ------------      ------------
                                  Net cash provided by (used in)
                                  operating activities .........................           67,723          (675,030)
                                                                                     ------------      ------------
Cash Flows From Investing Activities:

         Additions to property, plant & equipment ..............................          (46,231)          (27,366)
                                                                                     ------------      ------------
                                  Net cash used in
                                  investing activities .........................          (46,231)          (27,366)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
                                           ESPEY MFG. & ELECTRONICS CORP.
                                              Statements of Cash Flows
                                   Three Months Ended September 30, 1998 and 1997
                                                     (continued)

                                                                                               Unaudited
                                                                                             September 30
                                                                                    ------------------------------
                                                                                        1998              1997
                                                                                    ------------      ------------
<S>                                                                                  <C>               <C>  
Cash Flows From Financing Activities:

         Purchase of treasury stock ............................................          (87,402)             --
                                                                                     ------------      ------------
                                  Net cash used in
                                  financing activities .........................          (87,402)             --
                                                                                     ------------      ------------

Decrease in cash and short-term investments ....................................          (65,910)         (702,396)

Cash and short-term investments, beginning of period ...........................        2,591,739        12,123,583
                                                                                     ------------      ------------

Cash and short-term investments, end of period .................................     $  2,525,829      $ 11,421,187
                                                                                     ------------      ------------

Income Taxes Paid ..............................................................     $       --        $     70,000
                                                                                     ------------      ------------
</TABLE>
See accompanying notes to financial statements


                                      - 4 -
<PAGE>
                           ESPEY MFG. & ELECTRONICS CORP.

                          Notes to Financial Statements
                          -----------------------------
             
     1. In the  opinion  of  management  the  accompanying  unaudited  financial
statements  contain  all  adjustments   (consisting  of  only  normal  recurring
adjustments) necessary for a fair presentation for results for such periods. The
results for any interim period are not necessarily  indicative of the results to
be  expected  for  the  full  fiscal  year.  Certain  information  and  footnote
disclosures  normally  included in financial  statements  prepared in accordance
with generally  accepted  accounting  principles have been condensed or omitted.
These financial statements should be read in conjunction with the Company's most
recent  audited  financial  statements  included  in its 1998  Annual  Report to
Stockholders and its 1998 Form 10-K.

     2. The earnings per share computations for September 30, 1998 were based on
1,110,474 shares and on 1,111,220 shares for September 30, 1997. These represent
the average number of shares outstanding for each respective period.

     3. Other  income  consists  principally  of  interest  on  Certificates  of
Deposit,   Treasury  Bills,   money  market  accounts  and  dividend  on  equity
securities.

     4. For purposes of the statements of cash flows, the Company  considers all
liquid debt instruments  with original  maturities of three months or less to be
cash equivalents.

     5. In fiscal 1989 the Company  established an Employee Stock Ownership Plan
(ESOP) for eligible  non-union  employees.  The ESOP used the proceeds of a loan
from the Company to purchase  316,224  shares of the Company's  common stock for
approximately $8.4 million and the Company contributed approximately $400,000 to
the ESOP which was used by the ESOP to purchase an  additional  15,000 shares of
the Company's common stock.

     The loan from the Company to the ESOP is repayable in annual

                                      - 5 -
<PAGE>


     installments  of  $1,039,605,  including  interest,  through June  30,2004.
     Interest  is payable at a rate of 9% per annum.  The  Company's  receivable
     from the ESOP is recorded as common stock  subscribed  in the  accompanying
     balance sheets.

     Each year,  the Company will make  contributions  to the ESOP which will be
     used to make  loan  interest  and  principal  payments.  With each loan and
     interest  payment,  a portion of the  common  stock  will be  allocated  to
     participating employees. As of September 30, 1998 there were 165,139 shares
     allocated to participants.

     6.  The  Company  adopted  the  provisions  of  SFAS  No.  130,  "Reporting
Comprehensive  Income",  and SFAS No.  131,  "Disclosures  about  Segments of an
Enterprise and Related Information",  as of July 1, 1998. The adoptions of these
accounting stands had no material effect on the financial position or results of
operations of the Company.


                                      -6-

<PAGE>
                         ESPEY MFG. & ELECTRONICS CORP.
                     Management's Discussion and Analysis of
                  Financial Condition and Results of Operations
--------------------------------------------------------------------------------

Results of  Operations

Net sales for the three  months  ended  September  30, 1998 were  $2,523,984  as
compared to $2,503,584  for the same period in 1997. The lack of growth in sales
between the  comparative  quarters was due  principally to the low backlog which
the Company  experienced for most of fiscal 1998. The  "Management's  Discussion
and Analysis of Financial  Condition and Results of Operations" in the Company's
Annual  Report on Form 10-K for fiscal  1998  ("1998  Form  10-K")  reports  the
reversal  of this  trend  starting  in the  latter  part  of  fiscal  1998,  and
specifically reporting that approximately  $5,000,000 in new orders was received
during the first two months of fiscal 1999. The timing of this reversal, and the
lead time required for manufacture and shipment of new orders would dictate that
the effect of this reversal would not become evident until the second quarter of
fiscal 1999.

The cost of sales, as a percentage of sales,  rose slightly to 84% for the first
quarter of fiscal 1999 as compared to the 83% reflected for the same period last
year. This, however, is a decrease from the 87% which was reflected for the last
quarter of fiscal 1998.  Although gross profit for the current period  decreased
as compared to the corresponding period last year, net income increased due to a
substantial reduction in selling and general and administrative  expenses.  This
reduction  in the current  period was  principally  due to a  reduction  in both
professional fees and employment related expenses.

Other  Income  remained  relatively  the same for the  comparative  three  month
periods,  however the current period  reflects the addition of dividend  income,
arising from the purchase for investment of preferred equity  securities  during
the latter part of fiscal 1998.  These  dividends  are  non-taxable  for Federal
Income  Tax  purposes  to the  extent of 80%.  Cash and  short-term  investments
likewise  reflected  very  little  change  between the  comparative  three month
periods. The Company does not feel that there is any significant risk associated
with  its  investment   policy,   since  its   investments  are  represented  by
Certificates of Deposit,  United States Government Treasury Securities,  a Money
Market account, and more recently, preferred equity securities.

Net income for the three  months ended  September  30, 1998 were $84,042 or $.08
per share compared to $45,009,  or $.04 per share for the  corresponding  period
last year. The net earnings  increase was due to both reduced  overall  expenses
and the shipment of contracts with higher gross profit margins.

Liquidity and Capital Expenditures

There  were  no  differences  in the  three  month  comparative  periods  of the
Statements  of Cash  Flows  which  were  either  material  in nature or not self
explanatory.

The Company,  in the first quarter,  funded its operations  with cash flows from
operating activities and investing  activities.  Management currently feels that
during the balance of the fiscal year,  funds from operating  activities will be
adequate  to  meet  funding   requirements.   For  the  first  quarter   capital
expenditures were approximately $46,230.
<PAGE>
Since the debt of the Company's ESOP is not to an outside party, the Company has
eliminated  from the  Statements  of Earnings the  offsetting  items of interest
income and interest expense relating to the ESOP. The Company has eliminated the
offsetting accruals from the Balance Sheets.

As previously announced in the 1998 Form 10-K the Board of Directors has decided
to forgo the annual dividend in 1998. The Board is hopeful of reinstituting  the
payment of dividends when the Company returns to  profitability  on a consistent
basis.


                                      -7-
<PAGE>
Under existing authorizations,  as of September 30, 1998, funds in the amount of
$1,796,589 were available for the continuing repurchase of the Company's shares.

Business  Outlook

Customer  order  patterns are  inherently  difficult to predict.  As  previously
disclosed  in  the  1998  Form  10-K  one  of  the  Company's   major  customers
consolidated and relocated several of its facilities and various personnel.  The
ongoing  transition  stage of this  consolidation  which  caused  delays in both
ongoing and newly  proposed  programs is now  complete  and is  reflected in our
increasing  backlog.  The backlog as of September 30, 1997 was  $7,661,378.  The
backlog as of September 30, 1998 was $14,632,470.

The Company  presently  believes that it will continue to obtain  contracts more
consistent with its past experience.  Both Item 7, "Management's  Discussion and
Analysis of Financial Condition and Results of Operations - Business Outlook" of
our  1998  Form  10K  and  the  President's  message  in the  Annual  Report  to
Shareholders   for  1998   describe  in  detail  the  products  the  Company  is
concentrating  on and the types of  contracts  the  Company  expects to receive.
Management  presently  anticipates that sales for the second half of fiscal 1999
will exceed those of the first half.

The Company is  continuing  to expand its Sales and  Marketing  departments  and
restructuring  its management team.  Management  currently  anticipates that the
course of action the Company is taking will enhance the  Company's  revenues and
profitability in future periods.

Accounting Pronouncements

In June 1997,  Statement of Financial  Accounting  Standards No. 130, "Reporting
Comprehensive  Income" was issued.  Statement No. 130 establishes  standards for
reporting and display of  comprehensive  income and its components in a full set
of general  purpose  financial  statements.  Statement No. 130 requires that all
items  that  are  required  to  be  recognized  under  accounting  standards  as
components of comprehensive  income are to be reported in a financial  statement
that is displayed  in equal  prominence  with other  financial  statements.  The
Company  adopted  Statement No. 130 as of July 1, 1998,  and the adoption had no
significant impact on the Company's financial statements.

In June 1997, Statement of Financial Accounting Standards No. 131,  "Disclosures
about Segments of an Enterprise and Related Information," was issued.  Statement
No.  131  establishes  standards  for the way that a public  enterprise  reports
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 stockholders, but not for interim periods in
the initial year of adoption.  Statement  No. 131 is effective  for fiscal years
beginning after December 15, 1997. The Company  believes that it operates as one
segment,  which includes three product lines  (Electronic  Power Supplies,  Iron
Core  Components and  Electronic  Systems and  Assemblies)  and that adoption of
Statement  No.  131  will  not  have  a  significant  impact  on  its  financial
statements.
<PAGE>
Year 2000 Issues

The Year 2000 issue is the result of computer programs having been written using
two  digits,  rather  than  four,  to define  the  applicable  year.  Any of the
Company's  computers,   computer  programs,   manufacturing  and  administration
equipment or products  that have  date-sensitive  software may  recognize a date
using "00" as the year 1900 rather than the Year 2000.  If any of the  Company's
systems or  equipment  that have  date-sensitive  software  use only two digits,
system failures or miscalculations may result causing disruptions of operations,
including,  among other things, a temporary inability to process transactions or
send and receive  electronic data with third parties or engage in similar normal
business activities.


                                      - 8 -
<PAGE>
The Company  has formed a team to address  the Year 2000 issue that  encompasses
operating  and  administrative  areas of the  Company.  The  team  has  begun to
identify  and  resolve  significant  Year  2000  issues in a timely  manner.  In
addition,  executive  management  monitors the status of the Company's Year 2000
remediation  plans. The process includes an assessment of issues and development
of  remediation  plans,  where  necessary,  as they  relate to  internally  used
software,  computer  hardware and use of computer  applications in the Company's
manufacturing  processes  and products.  In addition,  the Company is engaged in
assessing  the Year 2000 issue  with  significant  suppliers.  The  Company  has
initiated  communications with its significant  suppliers and large customers to
determine the extent to which the Company is vulnerable to those third  parties'
failure  to  remediate  their  own Year 2000  issues.  Finally,  with  regard to
products  sold by the Company,  the Company has  determined  that  contingencies
related to the Year 2000 Issue  will not have a material  adverse  effect on the
Company.  Accordingly,  the Company has not  established a contingency  plan and
does not anticipate creating such a plan.

The Company intends to use both internal and external resources to reprogram, or
replace and test,  the software it currently  uses for Year 2000  modifications.
The  Company  plans to  substantially  complete  its Year  2000  assessment  and
remediation  by  January  31,  1999.  The  total  project  cost has not yet been
determined.  To date, the Company has not incurred any material costs related to
the assessment  of, and  preliminary  efforts in connection  with, its Year 2000
issues.

The costs of the project and the date on which the Company plans to complete its
Year 2000 assessment and remediation are based on management's estimates,  which
were derived  utilizing  numerous  assumptions  of future  events  including the
continued availability of certain resources,  third party modification plans and
other factors.  However,  there can be no guarantee that these estimates will be
achieved  and actual  results  could  differ  significantly  from  those  plans.
Specific  factors  that might  cause  differences  from  management's  estimates
include,  but are not limited to, the availability and cost of personnel trained
in this area, the ability to locate and correct  relevant  computer  codes,  and
similar  uncertainties.  Management  believes  that the Company is devoting  the
necessary  resources to identify and resolve  significant  Year 2000 issues in a
timely manner.

With  regard to its  internal  Year 2000  compliance  program,  the  Company has
completed approximately 75% of its review and, when necessary, remediation. With
regard  to its  Year  2000  compliance  program  addressing  the  status  of the
Company's suppliers and customers,  the Company has completed  approximately 50%
of its review.

Cautionary Statement for Purposes of the "Safe Harbor" Provisions of the Private
Securities Litigation Reform Act of 1995

It should be noted that certain  statements in this Management's  Discussion and
Analysis of Financial  Condition and Results of Operations are  "forward-looking
statements"  within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and
are made  pursuant  to the safe  harbor  provisions  of the  Private  Securities
Litigation  Reform Act of 1995.  The terms  "believe,"  "anticipate,"  "intend,"
"goal,"   "expect,"  and  similar   expressions  may  identify   forward-looking
statements.  These  forward-looking  statements  represent the Company's current
expectations or beliefs  concerning future events.  The matters covered by these
statements  are  subject to certain  risks and  uncertainties  that could  cause
<PAGE>
actual results to differ materially from those set forth in the  forward-looking
statements,   including   the  Company's   dependence  on  timely   development,
introduction and customer acceptance of new products,  the impact of competition
and price erosion,  as well as supply and  manufacturing  constraints  and other
risks  and  uncertainties.   The  forgoing  list  should  not  be  construed  as
exhaustive,  and the Company disclaims any obligation subsequently to revise any
forward-looking  statements to reflect events or circumstances after the date of
such  statements or to reflect the occurrence of  anticipated  or  unanticipated
events. The Company wishes to caution readers not to place undue reliance on any
such forward-looking statements, which speak only as of the date made.



                                      - 9 -
<PAGE>

                         ESPEY MFG. & ELECTRONICS CORP.

                PART II:  Other Information and Signatures



Item 4.  Submission of Matters to a Vote of Security Holders

         None during the quarter.


Item 5.  Other Information

         Effective  October  30,  1998  Mr.  Sol  Pinsley  resigned  as both the
         Chairman and a member of the Board of Directors.


Item 6.  Exhibits and Reports on Form 8-K

         None during the quarter.


                                      -10-


<PAGE>
                                    S I G N A T U R E S



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




                                              ESPEY MFG. & ELECTRONICS CORP.





                                              /s/Howard Pinsley
                                              ---------------------------
                                              Howard Pinsley, President


                                              /s/Herbert Potoker
                                              ---------------------------------
                                              Herbert Potoker, Treasurer and
                                              Chief Financial Officer




11 November 1998
----------------
       Date

                                      -11-