UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

[xx] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934

     For the quarterly period ended March 31, 1998

                          or

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

    For the transition period from            to

                         Commission File Number: 0-26262

                      USA BRIDGE CONSTRUCTION OF N.Y., INC.
             (Exact Name of Registrant as Specified in its Charter)

          New York                                    11-3032277
(State or Other Jurisdiction                (I.R.S. Employer Identification No.)
 of Incorporation        

                    53-09 97th Place, Corona, New York 11368
               (Address of Principal Executive Offices) (Zip Code)

                                 (718) 699-0100
              (Registrant's Telephone Number, Including Area Code)

                                       N/A
              (Former Name, Former Address and Former Fiscal Year,
                          if Changed Since Last Report)

         Check whether the issuer (1) has filed all reports required to be filed
by  section 13 or 15 (d) of the  Exchange  Act during the past 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 [ ]    No [ ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS

         State the  number of shares of each of the  issuer's  classes of common
equity  outstanding as of the latest  practicable  date: Common stock, par value
$.001 per share: 2,749,182 shares outstanding as of May 12, 1998.

         Transitional Small Business Disclosure Format (check one):
Yes [ ]   No [X]


                                       1
<PAGE>
                      USA BRIDGE CONSTRUCTION OF N.Y., INC.

                                      INDEX


PART 1.  FINANCIAL INFORMATION:

Item 1.  FINANCIAL STATEMENTS

         Balance Sheets March 31, 1998 (Unaudited) and June 30, 1997           3

         Statements of Operations (Unaudited)
         for the three months ended March 31, 1998 and 1997                    4

         Statements of Operations (Unaudited)
         for the nine months ended March 31, 1998 and 1997                     5

         Statement of Stockholders' Equity (Unaudited)
         for the nine months ended March 31, 1998                              6

         Statements of Cash Flows (Unaudited)
         for the nine months ended March 31, 1998 and 1997                     7

         Notes to Financial Statements                                      8-12

Item 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS                               13-19

PART II. OTHER INFORMATION

Item 1.  Legal Proceedings                                                    20

Item 2.  Changes In Securities And Use Of Proceeds                            20

Item 3.  Defaults Upon Senior Securities                                      20

Item 4.  Submission Of Matters To A Vote Of Security Holders                  21

Item 5.  Other Information                                                    21

Item 6.  Exhibits And Reports On Form 8-K                                     21


                                       2
<PAGE>
<TABLE>
<CAPTION>
                                    USA BRIDGE CONSTRUCTION OF N.Y., INC.
                                              BALANCE SHEETS

                                                                      (Unaudited)
                                                                       March 31,       June 30,
                                                                        1998            1997
                                                                    ------------    ------------
<S>                                                                 <C>             <C>         
                         ASSETS
Current assets:
      Cash                                                          $    241,336    $    554,025
      Cash, restricted                                                   222,280         214,001
      Contracts and retainage receivable, net                         10,812,618       8,943,147
      Costs and estimated earnings in excess of billings
       on uncompleted contracts                                        1,545,272       2,225,723
      Deferred tax assets                                                224,775         239,750
      Other current assets                                                59,179          80,727
      Due from related parties                                           183,550            --
      Due from parent company and affiliates                             542,810            --
                                                                    ------------    ------------
           Total current assets                                       13,831,820      12,257,373

Other assets                                                              24,435          21,445
                                                                    ------------    ------------

Total assets                                                        $ 13,856,255    $ 12,278,818
                                                                    ============    ============

<PAGE>
<CAPTION>
                                    USA BRIDGE CONSTRUCTION OF N.Y., INC.
                                              BALANCE SHEETS

                                                                      (Unaudited)
                                                                       March 31,       June 30,
                                                                        1998            1997
                                                                    ------------    ------------
<S>                                                                 <C>             <C>         
           LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
      Accounts payable, including cash overdraft
       of $36,781 and $119,658                                      $  1,763,807    $  3,392,317
      Accrued expenses                                                 1,202,034         749,819
      Payroll taxes payable                                            2,056,351       1,514,422
      Income taxes payable                                               692,798         507,379
      Current portion of long-term obligations                           300,000            --
      Due to related parties                                             152,376         321,894
      Due to affiliates                                                   52,220            --
      Billings in excess of costs and estimated earnings
       on uncompleted contracts                                             --           126,455
                                                                    ------------    ------------
           Total current liabilities                                   6,219,586       6,612,286
                                                                    ------------    ------------

Long-term obligations                                                  1,350,000            --
                                                                    ------------    ------------

Commitments and contingencies (Note 4)                                      --              --

Stockholders' equity:
      Preferred stock $.01 par value, authorized 500,000 shares,
       issued and outstanding -0-
      Common stock $.001 par value, authorized 10,000,000 shares,
       issued and outstanding 2,479,182 and 2,302,515                    504,494         504,047
      Additional paid in capital                                       4,827,526       4,459,906
      Retained earnings                                                1,220,699         702,579
                                                                    ------------    ------------
           Sub-total stockholders' equity                              6,552,719       5,666,532

      Less: Prepaid rent                                                 (84,800)           --
           Deferred compensation                                        (181,250)           --
                                                                    ------------    ------------
           Total stockholders' equity                                  6,286,669       5,666,532
                                                                    ------------    ------------

Total liabilities and stockholders' equity                          $ 13,856,255    $ 12,278,818
                                                                    ============    ============

</TABLE>
           See accompanying notes to financial statements (unaudited)

                                       3
<PAGE>
<TABLE>
<CAPTION>
                                         USA BRIDGE CONSTRUCTION OF N.Y., INC.
                                               STATEMENTS OF OPERATIONS
                                         FOR THE THREE MONTHS ENDED MARCH 31,
                                                      (UNAUDITED)

                                                                                     1998               1997
                                                                                -------------      -------------
<S>                                                                             <C>                <C>          
Contract revenue                                                                $   1,969,865      $   1,915,553

Cost of contract revenue                                                            1,368,084          1,129,472
                                                                                -------------      -------------

Gross profit                                                                          601,781            786,081

General and administrative expenses                                                   711,835            593,958
                                                                                -------------      -------------

(Loss) income from operations before other income
 (expense) and provision for income taxes                                            (110,054)           192,123
                                                                                -------------      -------------

Other income (expense):
    Interest income                                                                     3,169                -
    Interest expense                                                                 (112,723)            (1,011)
                                                                                -------------      -------------
         Total other income (expense)                                                (109,554)            (1,011)
                                                                                -------------      -------------

(Loss) income before provision for income tax (benefit) expense                      (219,608)           191,112

Provision for income tax (benefit) expense                                           (111,068)            76,445
                                                                                -------------      -------------

Net (loss) income                                                               $    (108,540)     $     114,667
                                                                                =============      =============

(Loss) income per common equivalent share:

    Basic:
         Net income (loss)                                                      $        .(04)     $         .06
                                                                                =============      =============
    Diluted:
         Net income (loss)                                                      $        (.04)     $         .06
                                                                                =============      =============

Weighted average number of shares outstanding                                       2,486,960          1,907,515
                                                                                =============      =============

Weighted average number of shares outstanding
  - assuming dilution                                                               2,486,960          1,982,120
                                                                                =============      =============

</TABLE>
           See accompanying notes to financial statements (unaudited)

                                       4
<PAGE>
<TABLE>
<CAPTION>
                                        USA BRIDGE CONSTRUCTION OF N.Y., INC.
                                               STATEMENTS OF OPERATIONS
                                          FOR THE NINE MONTHS ENDED MARCH 31,
                                                      (UNAUDITED)

                                                                                    1998                1997
                                                                                -------------      -------------
<S>                                                                             <C>                <C>          
Contract revenue                                                                $  14,239,151      $   7,691,412

Cost of contract revenue                                                           11,445,366          5,272,429
                                                                                -------------      -------------

Gross profit                                                                        2,793,785          2,418,983

General and administrative expenses                                                 1,969,818          1,665,197
                                                                                -------------      -------------

Income from operations before other income
 (expense) and provision for income taxes                                             823,967            753,786
                                                                                -------------      -------------

Other income:
    Interest expense                                                                 (112,723)            (2,022)
    Interest income                                                                     8,368                 -
                                                                                -------------      -------------
         Total other income (expense)                                                (104,355)            (2,022)
                                                                                -------------      -------------

Income before provision for income tax expense                                        719,612            751,764

Provision for income tax (benefit) expense                                            201,492            301,000
                                                                                -------------      -------------

Net income                                                                      $     518,120      $     450,764
                                                                                =============      =============

Income per common equivalent share:

    Basic:
         Net income                                                             $         .22      $         .24
                                                                                =============      =============
    Diluted:
         Net income                                                             $         .22      $         .23
                                                                                =============      =============

Weighted average number of shares outstanding                                       2,363,997          1,907,515
                                                                                =============      =============

Weighted avenge number of shares outstanding
 - assuming dilution                                                                2,363,997          1,949,740
                                                                                =============      =============

</TABLE>

           See accompanying notes to financial statements (unaudited)

                                       5
<PAGE>
<TABLE>
<CAPTION>
                      USA BRIDGE CONSTRUCTION OF N.Y., INC.
                        STATEMENT OF STOCKHOLDERS' EQUITY
                    FOR THE NINE MONTHS ENDED MARCH 31, 1998
                                   (UNAUDITED)
                                                                                                     Deductions
                                                                                                     related to
                                                               Additional                           stock issued        Total
                                        Common Stock             paid in           Retained          for future      Stockholders'
                                    Shares        Amount         capital           earnings           services          equity
                                  -----------   ----------   --------------    --------------      --------------   ------------
<S>                                 <C>         <C>          <C>               <C>                 <C>              <C>         
Balances at July 1, 1997            2,302,515   $  504,047   $    4,459,906    $      702,579      $          -     $  5,666,532

Issuance of common shares in
 lieu of prepaid rent                 106,667          107          112,960               -              (113,067)           -

Issuance of common shares
 in connection with Senior
 Management Incentive Plan            340,000          340          254,660               -              (217,500)        37,500

Amortization of prepaid rent
 and deferred compensation                -            -                -                 -                64,517         64,517

Net income for the nine months
 ended March 31, 1998                     -            -                -             518,120                 -          518,120
                                  -----------   ----------   --------------    --------------      --------------   ------------

Balances at March 31, 1998          2,749,182   $  504,494   $    4,827,526    $    1,220,699      $     (266,050)  $  6,286,669
                                  ===========   ==========   ==============    ==============      ==============   ============
</TABLE>


           See accompanying notes to financial statements (unaudited)


                                       6
<PAGE>
<TABLE>
<CAPTION>
                                        USA BRIDGE CONSTRUCTION OF N.Y., INC.
                                              STATEMENTS OF CASH FLOWS
                                         FOR THE NINE MONTHS ENDED MARCH 31,
                                                     (UNAUDITED)

                                                                                     1998            1997
                                                                                  -----------    -----------
<S>                                                                               <C>            <C>        
Cash flows from operating activities:
    Net income                                                                    $   518,120    $   450,764
    Adjustments to reconcile net (loss) income to net
     cash provided by (used for) operating activities:
         Amortization                                                                   4,797          3,490
         Recovery of bad debt                                                        (128,000)          --
         Deferred taxes                                                                14,975           --
         Stock issued for services                                                     73,750           --
         Prepaid rent                                                                  28,267           --
    Decrease (increase) in:
         Accounts receivable                                                       (1,741,471)    (3,699,941)
         Prepaid expenses                                                             (11,365)        (3,150)
         Costs and estimated earnings in excess of
          billings on uncompleted contracts                                           680,451      1,044,828
         Other current assets                                                           8,890        (27,400)
    Increase (decrease) in:
         Accounts payable                                                             (32,440)     1,559,273
         Accrued expenses                                                             287,018        (23,759)
         Payroll taxes payable                                                        707,126        284,920
         Income taxes payable                                                         185,419        301,000
         Billings in excess of costs and estimated
          earnings on uncompleted contracts                                          (126,465)        12,892
                                                                                  -----------    -----------
            Net cash provided by (used for) operating activities                      469,072        (97,083)
                                                                                  -----------    -----------

Cash flows from investing activities:
    Purchase of other assets                                                           (7,777)        (5,677)
    Increase in restricted cash                                                        (8,279)          --
                                                                                  -----------    -----------
         Net cash provided by (used for) investing activities                         (16,056)        (5,677)
                                                                                  -----------    -----------
<PAGE>
<CAPTION>
                                        USA BRIDGE CONSTRUCTION OF N.Y., INC.
                                              STATEMENTS OF CASH FLOWS
                                         FOR THE NINE MONTHS ENDED MARCH 31,
                                                     (UNAUDITED)

                                                                                     1998            1997
                                                                                  -----------    -----------
<S>                                                                               <C>            <C>        
Cash flows from financing activities:
    Loans from repayments (to) related parties                                       (535,293)       224,963
    Repayments to shareholders                                                       (230,412)          --
                                                                                  -----------    -----------
            Net cash (used for) provided by financing activities                     (765,705)       224,963
                                                                                  -----------    -----------

Net (decrease) increase in cash                                                      (312,689)       122,203
Cash, beginning                                                                       554,025        223,789
                                                                                  -----------    -----------

Cash, ending                                                                      $   241,336    $   345,992
                                                                                  ===========    ===========

Supplemental disclosure of cash flow information:
    Interest paid                                                                 $      --      $      --
                                                                                  ===========    ===========
    Taxes paid                                                                    $      --      $      --
                                                                                  ===========    ===========

Supplemental disclosure of non-cash financing activities:
    Issuance of common stock upon exercise of options
     in exchange of stock subscription receivable                                 $      --      $   137,500
                                                                                  ===========    ===========
    Issuance of common stock in prepayment of rent and
     deferred compensation                                                        $   330,567    $      --
                                                                                  ===========    ===========
</TABLE>

           See accompanying notes to financial statements (unaudited)

                                       7
<PAGE>
                      USA BRIDGE CONSTRUCTION OF N.Y., INC.
                          NOTES TO FINANCIAL STATEMENTS
               FOR THE THREE MONTHS ENDED MARCH 31, 1998 AND 1997
                                   (UNAUDITED)


NOTE 1 - GENERAL

         The Company was  incorporated on September 4, 1990 and is a 56.8% owned
         subsidiary of USABG Corp.  ("Corp.").  The Company's  President is also
         the majority  stockholder  (66.3%) of Corp.  and may be considered  the
         beneficial owner of the Company.

         The accompanying  unaudited financial  statements have been prepared in
         accordance with generally  accepted  accounting  principles for interim
         financial   information   and  with   instructions   to  Form   10-QSB.
         Accordingly,  they do not include all of the  information and footnotes
         required by  generally  accepted  accounting  principles  for  complete
         financial  statements.   In  the  opinion  of  management  the  interim
         financial statements include all adjustments necessary in order to make
         the financial statements not misleading.  The results of operations for
         the nine and three months ended is not  necessarily  indicative  of the
         results to be  expected  for the full year.  For  further  information,
         refer to the  Company's  audited  financial  statements  and  footnotes
         thereto at June 30, 1997,  included in the Company's Annual Report Form
         10-KSB filed with the Securities and Exchange Commission.

NOTE 2 - LONG-TERM OBLIGATION

         In November 1997,  the Company  entered into an agreement with the Iron
         Workers  Local 40, 361, and 417 Joint  Security  Funds (the "Union") in
         order to liquidate  $1,750,000  owed for unpaid union dues and benefits
         previously  recorded as  accounts  payable.  The Company  agreed to pay
         $75,000 by January 1998 and at least $25,000 monthly  commencing  March
         1, 1998 with  interest at 9.5% per annum.  As  collateral,  the Company
         assigned its  retainage  receivable  from a certain  project as well as
         $1,750,000 of its related  mechanic's lien (which was discharged on the
         lien-debtor's  posting of a bond with the court).  Upon any funds being
         released or paid under such bond,  the Union will be repaid any balance
         it is owed, in full, and the Company shall receive the  remainder.  The
         Company  will  receive  credit for any  payments  received by the Union
         related to the assigned portion of the bond. The total remaining due at
         March 31, 1998 is $1,650,000,  with $300,000 classified as current: the
         remaining $1,350,000 is classified as non-current.

NOTE 3 - STOCKHOLDERS' EQUITY

         a) Issuance of common stock

            In February  1998,  the Company  agreed to issue 106,667  restricted
            shares of its common stock to the Company as  consideration to Corp.
            for  issuing  192,000  shares  of its own  common  stock  to RSJJ in
            consideration  for payment in full of the rent due by the Company to
            R.S.J.J.  Realty  Corp.  ("RSJJ") a company  owned by the  Company's
            President  for the period from January 1, 1998 to December 31, 1998.
            The value of the shares  issued by the Company  was  recorded at the
            estimated  market  value at the date of issuance of $2.12 per share,
            with a 50% discount due to the restricted nature of the stock.

                                       8
<PAGE>
         b) In December  1997,  the Company  authorized  the issuance of 290,000
            restricted  shares of its common stock  during the third  quarter of
            its fiscal year pursuant to its Senior Management Incentive Plan. Of
            the 290,000 shares,  150,000 were issued to the Company's President,
            70,000 to the  Company's  Secretary,  and  70,000  to the  Company's
            Treasurer.  These shares vest 50% on June 1, 1998 and 50% on January
            1, 1999. The Company also  authorized  and issued 50,000  restricted
            shares to certain of its  employees  and  consultants:  these shares
            vest   immediately.   The  Company   authorized   the  filing  of  a
            Post-Effective  Amendment  to the Form S-8  Registration  Statement,
            initially  filed  in  February  1997,  to  register  the  resale  of
            management's  shares. In connection with such issuance,  the Company
            recorded   compensation   and   consulting   expense   amounting  to
            approximately  $255,000  which is based on the  average  closing bid
            price of $1.50  per  share  for the  month of March  1998 with a 50%
            discount due to the restricted nature of the stock. The above shares
            which  do not  vest  immediately  have  been  recorded  as  deferred
            compensation and are amortized over the vesting period.

NOTE 4 - COMMITMENT AND CONTINGENCIES

         a) Disclosure of significant estimates - revenue recognition

            The Company's  construction  revenue is recognized on the percentage
            of completion basis.  Consequently,  construction  revenue and gross
            margin for each  reporting  period is  determined  on a contract  by
            contract basis by reference to estimates by the Company's management
            and  engineers  of expected  costs to be  incurred to complete  each
            project.   These   estimates   include   provisions  for  known  and
            anticipated  cost  overruns,  if any exist or are expected to occur.
            These  estimated  may be subject to revision in the normal course of
            business.

        b)  Lease agreement

            The Company  leases its  administrative  offices  and storage  space
            pursuant to a signed lease  agreement with an affiliate owned by the
            Company's  President.   Such  lease  requires  monthly  payments  of
            $20,000.  The lease  originally  expired  on March 31,  1998 but was
            extended to  December  31,  1998.  Under such lease  agreement,  the
            Company  is  required  to make  future  minimum  lease  payments  as
            follows:

                  Year Ending
                   June  30,
                  -----------
                     1998                                   240,000
                     1999                                   120,000
                                                    ---------------
                     Total                          $       360,000
                                                    ===============


            The Company  also leases a yard for storage of material  pursuant to
            an oral  agreement with an unrelated  party which  requires  monthly
            payments  of  $3,500.  As a  result  of the  issuance  of  stock  in
            prepayment of the above lease  agreement,  the Company's  total rent
            under the lease will be $113,067.  Accordingly,  included in general
            and  administrative  expenses  is rent  expense  which  amounted  to
            $38,767 and $70,500  for the three  months  ended March 31, 1998 and
            1997,  respectively,  and  $179,767 and $211,500 for the nine months
            ended  March 31, 1998 and 1997,  respectively.  As of March 31, 1998
            and  June 30,  1997,  $98,000  and  $68,500,  respectively,  of rent
            remains unpaid and is included in accounts payable.

                                       9
<PAGE>
         c) Significant customers and vendors

            For the three months ended March 31, 1998 and 1997,  the Company had
            two and four unrelated customers,  respectively, which accounted for
            approximately  76% and 24%  and  48%,  19%,  12%,  and 10% of  total
            revenues.  As of  March  31,  1998,  approximately  17%  and  55% of
            contracts and retainage receivables are due from two customers

            For the nine months  ended March 31, 1998 and 1997,  the Company had
            three and three unrelated  customers  respectively,  which accounted
            for  approximately  60%,  12%,  and  12%  and  34%,  31%,  and  17%,
            respectively,  of total revenues. As of June 30, 1997, approximately
            22%, 21%, 15%, and 24% of contracts and retainage receivables net of
            allowances for doubtful accounts are due from four customers.

         d) Seasonality

            The Company operates in an industry which may be seasonal, generally
            due  to  inclement  weather  occurring  during  the  winter  months.
            Accordingly,  the Company may  experience a seasonal  pattern in its
            operating  results with lower  revenue in the third  quarter of each
            fiscal year. Quarterly results may also be affected by the timing of
            bid  solicitations  by  governmental  authorities  and the  stage of
            completion of major projects.

         e) Bonding requirements

            The Company is required to provide bid and/or  performance  bonds in
            connection with  governmental  construction  projects.  To date, the
            Company has been able to obtain  bonding  for its private  projects.
            The  Company is  continuously  pursuing  obtaining  bonding  for its
            governmental  construction  projects.  In addition,  new or proposed
            legislation  in various  jurisdictions  may  require  the posting of
            substantial  additional bonds or require other financial  assurances
            for  particular  projects.  The  Company has been unable to bid as a
            general contractor on New York State and New York City projects as a
            result of its  inability to obtain  bonding from a New York licensed
            bonding Company.

         f) Mechanic's liens

            As of June 30, 1997, three actions to foreclose upon mechanics liens
            filed  during the fiscal  year were  commenced.  Such  actions  seek
            relief in the aggregate amount of $3,278,775.  As of March 31, 1998,
            additional  mechanic's  liens were filed,  bringing the total relief
            sought to $16,919,542.

            The  mechanic's  liens have been filed in relation to work completed
            and billed.  As such,  these  amounts are included in contracts  and
            retainage  receivable.  Based upon the  assessment of management and
            legal  counsel,  the Company has recorded on allowance  for doubtful
            account  to adjust the  receivables  to their  estimated  realizable
            amount.

         g) Payroll taxes

            As  of  March  31,  1998  and  June  30,  1997,   the  Company  owed
            approximately  $2,056,351 and $1,514,422,  respectively,  of payroll
            taxes and related estimated interest and penalties.  Although, as of
            March  31,  1998,  the  Company  has not  entered  into  any  formal
            repayment  agreements  with the respective tax  authorities,  it has
            been making payments based on oral agreements.

                                       10
<PAGE>
         h) Legal proceedings

            The  Company  is party  to  various  claims  and  legal  proceedings
            incidental to its business.  In management's opinion, the outcome of
            these claims and proceedings will not have a material adverse effect
            on the financial statements of the Company taken as a whole.

         i) Claims

            The  Company  elected  not to  recognize  any portion of the revenue
            associated  with any contract  claims until the amounts  recoverable
            can be  accurately  estimated.  Claims are  amounts in excess of the
            agreed  contract  price  which  the  Company  seeks to  collect  for
            customer  caused  delays,  errors  in  specifications  and  designs,
            contract terminations, change orders in dispute or unapproved.

NOTE 5 - RELATED PARTY TRANSACTIONS

         a) Purchase of material and labor

            For the three and six  months  ended  March 31,  1998 and 1997,  the
            Company   paid  $0  and   $33,500,   respectively,   to  USA  Bridge
            Construction Corp. (Maryland) ("MD") for certain materials and labor
            necessary  to  perform  steel  erection  services.  Amounts  payable
            related to all of such transactions and included in accounts payable
            total  $47,220 at March 31,  1998.  Such  amounts  are  non-interest
            bearing obligations. MD is under the common control of the Company's
            majority stockholder.

         b) Rent expense

            Included in general and administrative expenses is rent expense paid
            pursuant to a signed  lease  agreement  with a Company  owned by the
            Company's  majority  stockholder.  Such rent amounted to $28,267 and
            $148,267  for the three and nine months,  respectively,  ended March
            31,  1998 and $60,000 and  $180,000  for the three and nine  months,
            respectively,  ended March 31,  1997.  Included  as a  deduction  to
            stockholders' equity as of March 31, 1998 is prepaid rent of $88,400
            representing  rent paid through December 31, 1998 to such affiliated
            entity.

         c) Employment agreement

            On April 4, 1995, the Company  entered into an employment  agreement
            with its  President and Director for a term of  approximately  three
            (3)  years  expiring  on June 30,  1998.  The  employment  agreement
            provides  for  an  annual  salary  of  $300,000  with  a 10%  annual
            escalation. Pursuant to the agreement, the President and Director is
            also entitled to receive a $50,000 per year non-accountable  expense
            allowance  payable in equal weekly  installments.  He also  received
            stock options under the Company's 1994 Senior  Management  Incentive
            Plan to purchase  25,000  shares at $5.50 per share,  vesting at the
            rate of  7,500 in each of April  1996 and 1997 and  10,000  in April
            1998.  The option shall  contain such other terms and  conditions as
            set forth in the stock option  agreement.  The exercise price of the
            options is equal to 110% of the stock  price in the  initial  public
            offering. The foregoing options are intended to qualify as incentive
            stock  options.  The  President  and  Director  is also  entitled to
            receive an annual  bonus of $50,000 if the Company  nets  $1,000,000
            before taxes in any year and an additional $25,000 for each $500,000
            of additional pre-tax profits. Advances against such bonus are equal
            to  $10,000   payable  monthly  until  the  end  of  the  employment
            agreement,  at such time any excess  advances will be re-paid to the
            Company. No advances have been made as of March 31, 1998.

                                       11
<PAGE>
            Also  pursuant to the  employment  agreement,  the Company  will pay
            premiums on a $3,500,000  life  insurance  policy for the benefit of
            individuals  as directed by such  President and  Director.  Any cash
            surrender  value is the  Company's  property  until  the  employment
            agreements ends. The estimated premium on such policy is $80,000 per
            year.

         d) Due to/from related parties

            As of March 31, 1998,  the Company has advanced  $726,360 to related
            companies.  Such  advances are  non-interest  bearing and are due on
            demand.

            As of March 31,  1998 the Company  has  advanced to its  President a
            total of approximately  $5,044.  The remaining  balance amounting to
            $721,316  represents  advances  to  other  related  companies.  Such
            advances are non-interest bearing and are due on demand.

NOTE 6 - SUBSEQUENT EVENTS

         a) In April 1998,  the Company  redeemed its  certificate of deposit of
            approximately $222,000, repaying a loan of approximately $147,000 on
            behalf of Corp.  The  balance of the funds were  deposited  into the
            Company's operating account.

         b) Letter of Intent

            On May 12, 1998,  the Company and Corp.  executed a letter of intent
            whereby the Company shall acquire First Anglo-Swiss  Holdings,  Inc.
            ("FAS").  The letter provides,  among other things, that the Company
            shall acquire 51% of the outstanding shares of common stock from the
            stockholders  of FAS in exchange for 510,000 shares of the Company's
            Common Stock.  Simultaneously  with the closing of the  acquisition,
            Corp.  has agreed to sell all of its shares of Company  Common Stock
            to Amalgamated Resources Management S.A. ("ARM") for an aggregate of
            $10,220,000.  Also at closing,  the holders of FAS  preferred  stock
            shall  exchange  all of  such  shares  for  shares  of a  series  of
            preferred stock in the Company which shall carry the same rights and
            preferences as the shares of FAS preferred stock.

                                       12
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS


           CAUTIONARY STATEMENT REGARDING FORWARD LOOKING INFORMATION

         The Private Securities Litigation Reform Act of 1995 ("Act") provides a
safe harbor for forward-looking  information made on behalf of the Company.  All
statements,  other than  statements  of  historical  facts,  which  address  the
Company's  expectation  of sources of capital  or which  express  the  Company's
expectation  for the future with respect to financial  performance  or operating
strategies  can be identified  as  forward-looking  statements.  Forward-looking
Statements  made by the Company are based on  knowledge  of the  environment  in
which it operates,  but because of the factors previously listed, as well as the
factors beyond the control of the Company,  actual results may differ materially
from the expectations expressed in the forward-looking statements.

General

         USA  Bridge  Construction  of  N.Y.,  Inc.  (the  "Company")  commenced
operations in or about June 1993 to serve primarily as a general  contractor for
construction  projects  sponsored  by  federal,   state,  and  local  government
authorities  in the New York  State and  Metropolitan  areas.  Though  formed to
operate  as a general  contractor,  the  Company  operated  initially  only as a
subcontractor.  The  Company's  goals  were to become a general  contractor  for
municipal projects;  however, it needed financing to enable it to obtain bonding
which is required for all municipal projects.  To date, the Company has provided
steel  erection for building,  roadway,  and bridge repair  projects for general
contractors  who  have  been  engaged  by  private  and   municipal/governmental
customers.  As of March  31,  1998,  the  Company  has  completed  in  excess of
twenty-one  projects  with an  aggregate  project  value of  $40,000,000  and is
currently  engaged in two (2) projects with an aggregate value of  approximately
$10,790,150.  The Company  plans to maintain its  subcontractor  presence in the
steel industry, however, now that it has obtained general contractor bonding, it
intends to focus on obtaining projects as a general contractor.

         In December 1996,  for its general  contracting  projects,  the Company
obtained  a  commitment  for a Surety  Bond Line of Credit  ($10,000,000  single
project limit) from United  American  Guarantee  Company,  Ltd.  ("UAGC").  This
commitment  allows the Company to pursue those general  contracting  projects in
the public and private sectors which require  Performance Bonds. To date, it has
also  allowed the  Company to obtain  Performance  Bonds and Labor and  Material
Bonds for the three  subcontracting  projects  which  have  required  same:  the
EklecCo.,  Grand Central Terminal,  and Korean Mission projects.  Since New York
State and City  agencies  require bonds from bonding  companies  licensed by the
State of New York, however, and UAGC is not a New York licensed bonding company,
the Company is as yet unable to bid as a general  contractor on projects for New
York State and City agencies.

         New York State agencies require bonds from bonding  companies they have
approved.  The Company has received bonding from a company which is not approved
for  state  and city  projects;  therefore,  the  Company  is unable to bid as a
general contractor on projects for New York State and City agencies. The Company
has approached several New York approved bonding companies;  however,  as of the
date hereof, it has not been approved by any such company to receive bonding.

         In determining whether to issue a bond, surety companies perform credit
checks and other due  diligence  disclosure  requirements  and  investigate  the
Company's  capitalization,   working  capital,  past  performance,  management's
expertise,  and other factors.  The surety companies require companies receiving
bonding to maintain  certain  amounts of capital and liquid  assets and base the
amount of  bonding  they will  issue on a  formula,  which is  usually  based on
certain  industry  standards  which take into account such  factors.  The surety
companies also require that the bonds be personally guaranteed by Mr. Polito. In
order for the  Company to obtain and  maintain  bonding,  it must  adhere to the
requirements  stipulated in the bonding  agreements which vary with each bonding
company.  The bonding costs for each bond are incorporated in the contract price
of each job. These costs are carried as a line item in the  requisition and paid
by the customer. Any monies taken from the working capital for this purpose will
be replaced as the monthly requisition  payments are received from the customer.
Bonding  requirements  vary  depending  upon the  nature of the  projects  to be
performed.  The Company anticipates paying a fee to bonding companies of between
11/4% to 31/2% of the amount of the contracts to be performed.  Since these fees
are generally  payable at the beginning of a project,  the Company must maintain
sufficient  working  capital  to  satisfy  the fee prior to  receiving  from the
project.

                                       13
<PAGE>
         In the New  York  City  metropolitan  area,  there is an  abundance  of
subcontractors who have significant  experience and are competitive with respect
to pricing and level of service.  As a general  contractor,  the Company will be
responsible  for  performance of the entire  contract,  including the work to be
performed  by  subcontractors.  Accordingly,  the  Company  may  be  subject  to
substantial  liability  if a  subcontractor  fails to  perform as  required.  In
addition,   unanticipated  difficulties  may  arise  in  hiring  and  overseeing
subcontractors.

         Though the  Company  does not believe its  business  is  seasonal,  its
operations are generally slow in the winter months due to the decrease in worker
productivity  because  of  weather  conditions.  Accordingly,  the  Company  may
experience a seasonal pattern in its operating results with lower revenue in the
third quarter of each fiscal three months.  Interim results may also be affected
by the timing of bid solicitation, the stage of completion of major projects and
revenue recognition policies. For the nine months ended March 31, 1998 and 1997,
the Company only obtained $20,000 and $1,780,000, respectively of new contracts.
The primary  reason for not  obtaining  any material new  contracts for the nine
months  ended March 31, 1998 and 1997 is because the Company did not provide the
lowest bids for the projects on which it was bidding.

         The Company's  operations  are  substantially  controlled by Mr. Polito
since he owns  approximately  66% of the  outstanding  shares  of  USABG  Corp.,
("Corp.") the parent company who owns 48% of the common stock of the Company and
may be considered the beneficial owner of the Company. Mr. Polito is also a 100%
shareholder of RSJJ Realty Corp. ("RSJJ"). RSJJ leases the administrative office
space to the Company at a cost of $20,000 per month  pursuant to a signed  lease
agreement  expiring on December 31, 1998. Mr. Polito also has ownership interest
in Crown Crane, Inc. and Atlas Gem Leasing,  Inc. which provided services to the
Company  during the nine  months  ended  March 31,  1998 and 1997.  Lastly,  the
Company  purchased  from USA Bridge  Construction  Corp.  (Maryland)  ("MD"),  a
wholly-owned  subsidiary of Corp,  certain  materials and labor to perform steel
erection service. MD ceased substantially all of its operations during September
1996 and, accordingly, the Company purchased its steel from unrelated parties.

         The Company  recognizes  revenue and costs for all contracts  under the
percentage of completion  method.  Cost of contract  revenues include all direct
material  and  labor  costs  and  those   indirect  costs  related  to  contract
performance.  General and  administrative  expenses are  accounted for as period
costs and are,  therefore,  not included in the  calculation of the estimates to
complete  construction  contracts  in  progress.  Material  project  losses  are
provided  for  in  their  entirety  without   reference  to  the  percentage  of
completion.  As  contracts  can  extend  over  one or more  accounting  periods,
revision  in costs and  earnings  estimated  during  the  course of the work are
reflected during the accounting period in which the facts become known.

         The current asset,  "costs and estimated earnings in excess of billings
on uncompleted  contracts",  represents revenues recognized in excess of amounts
billed  on  respective  uncompleted  contracts  at the end of each  period.  The
current  liability,  "billings  in  excess of costs and  estimated  earnings  on
uncompleted  contracts," represents billings which exceed revenues recognized on
respective uncompleted contracts at the end of each period.

                                       14
<PAGE>
         An amount equal to the costs  attributable to unapproved  change orders
and claims is  included  in the total  estimated  revenue  when  realization  is
probable  and the  amount can be  estimated.  The  Company  has  elected  not to
recognize  any portion of the revenue  associated  with such  unapproved  change
orders and claims  until the amounts have been  received or awarded.  Claims are
amounts  in excess of the  agreed  contract  price  which the  Company  seeks to
collect for  customer  caused  delays,  errors in  specifications  and  designs,
contract terminations, change orders in dispute or which are unapproved.

Three months ended March 31, 1998 as compared to the
three months ended March 31, 1997

         Contract  revenues  for the three  months ended March 31, 1998 and 1997
amounted to $1,969,865 and $1,915,553, respectively. This net increase amounting
to $54,312 (or  approximately 3%) is partially a result of the Company's backlog
as of June 30, 1997 which amounted to approximately  $7,900,000,  change orders,
and the  termination  of the EklecCo  and Korean  Mission  projects.  The change
orders for the three  months  ended  March 31, 1998  amounted  to  approximately
$175,000  for the  remaining  projects:  Grand  Central and Louis  Vuitton.  The
backlog at March 31, 1998 amounted to approximately $600,000. The backlog amount
represents  the contracts and change orders the Company  entered into during the
latter part of its June 30, 1997 fiscal year during the nine months  ended March
31, 1998.

         During the three months ended March 31,  1998,  approximately  $290,000
(or  17%) of the  revenue  recognized  during  the  period  was  collected.  The
remaining  amounts  uncollected  represent  retainage  expected to be  collected
within the next one to two years or amounts  which the Company is  attempting to
collect under mechanic's liens.  Approximately  $213,000 (or 11%) of the revenue
recognized was not billed at March 31, 1998.

         On October 14, 1997, the Company filed a mechanic's  lien in the amount
of $13,640,767  against EklecCo (f/k/a Pyramid Company of Rockland).  On October
16, 1997, in New York State Supreme Court,  Rockland County,  EklecCo  commenced
suit against the Company  seeking to vacate the mechanic's lien filed against it
and seeking specific  enforcement of the contract,  declaratory relief,  damages
for slander of title, and approximately $500,000,000 in damages from the Company
for breach of contract and intentional  interference with contractual relations.
The lien was not vacated,  however,  and on February 9, 1998,  EklecCo  posted a
bond in the amount of $14,254,730 to secure payment of the Company's $13,640,747
mechanic's  lien,  interest,  and court costs;  accordingly,  the court  granted
EklecCo motion to discharge said lien.

         The  Company's  gross  profit for the three months ended March 31, 1998
and 1997 amounted to 31% and 41%, respectively. The decrease in gross profit for
the three  months  ended March 31, 1998 as compared to three  months ended March
31, 1997 is primarily a result of an overall  different  mix of  contracts  with
lower gross profit percentages. The overall estimated gross profit for the three
months  ended  March 31,  1998 was  approximately  21% as  compared to the three
months ended March 31, 1997 whereby the overall  estimated  average gross profit
was 28%.  Additionally,  the effect of change orders and certain  adjustments to
estimated  costs, as well as the  interruption  and termination of certain jobs,
has resulted in reductions of overall gross profit.

         For the three months ended March 31, 1998 and 1997, the Company paid $0
and $33,500,  respectively,  to MD for  material and labor  necessary to perform
steel erection services.  During September 1996, MD ceased  substantially all of
its  operations  and the  Company  began  purchasing  material  and  labor  from
unrelated third party steel fabricators.  At March 31, 1998, the Company owed MD
$47,220  principally for advances in connection  with the above  services:  such
amounts are non-interest bearing and are due on demand.

                                       15
<PAGE>
         Below is a summary of the Company's  billings and  collections  for the
three months ended March 31, 1998:
<TABLE>
<CAPTION>
                                    Gross contract
                                    and retainage           Allowances for       Net contracts
                                     receivables            uncollectible        receivables
                                     -----------            -------------        -----------
<S>                                  <C>                    <C>                  <C>        
Balances at December 31, 1997        $12,285,003            $(2,159,000)         $10,126,003
Billings                               1,481,683                    -              1,481,683
Collections                              795,068                    -                795,068
                                     -----------            -----------          -----------
Balances at March 31, 1998           $12,471,618            $(2,159,000)         $10,812,618
                                     ===========            ===========          ===========
</TABLE>

         Through May 15, 1998, the Company has collected  approximately $815,000
or 8% of its net  contract  receivables.  As of March 31, 1998,  $5,917,455  (or
approximately 55%) of its net receivables is due from the EklecCo.  project. The
project was to be performed in two phases. The Company commenced work on Phase I
in  June  1996.  The  project  was  terminated  in  October  1997  when  it  was
approximately 98% complete.  On October 14, 1997, the Company filed a mechanic's
lien in the amount of $13,640,767  against  EklecCo  (f/k/a  Pyramid  Company of
Rockland),  for the EklecCo project.  See Part II., Item 2. "Legal  Proceedings"
for additional information.

         In  addition to the above lien,  the  Company has filed  various  other
liens on certain other projects with net receivables  amounting to approximately
$1,877,214. With regards to the remaining receivables amounting to approximately
$3,018,000  (approximately  $795,000 of which  represents  retainage that is not
expected  to be  collected  within one  year),  the  Company  expects to collect
approximately the remaining $2,223,000 by the end of the first quarter of fiscal
1998 and 1999.

         As of March 31, 1998, the Company is engaged in two major projects with
a total contract value amounting to $10,732,750  whereby the backlog  associated
therewith amounted to approximately $600,000. The contract receivable associated
with ongoing projects is approximately $1,244,000.

         General and administrative expenses have increased by $117,877 (or 20%)
to $711,835  for the three  months  ended March 31, 1998 from  $593,958  for the
three months ended March 31, 1997. The increase in general  administration costs
is mainly  attributable to an overall  increase of the Company's  administrative
salaries  associated with the material  increase in contract revenue and certain
general corporate overhead.

         For the three  months  ended March 31,  1998,  the Company  recorded an
estimated  income tax benefit of $111,068  whereby  for the three  months  ended
March 31, 1997, the Company recorded an estimated income tax expense of $76,445.

Nine months ended March 31, 1998 as compared to the nine
months ended March 31, 1997

         Contract  revenues  for the nine  months  ended March 31, 1998 and 1997
amounted  to  $14,239,151  and  $7,691,412,   respectively.  This  net  increase
amounting  to  $6,547,739  (or  approximately  85%) is partially a result of the
Company's   backlog  as  of  June  30,  1997  which  amounted  to  approximately
$7,900,000,  and change orders and the  termination  of the Palisades and Korean
projects. The change orders for the nine months ended March 31, 1998 amounted to
approximately  $2,608,000  for the remaining  projects,  Grand Central and Louis
Vuitton.

                                       16
<PAGE>
         The Company's gross profit for the nine months ended March 31, 1998 and
1997 amounted to 20% and 32%, respectively. The decrease in gross profit for the
nine months ended March 31, 1998 as compared to nine months ended March 31, 1997
is primarily a result of an overall  different mix of contracts with lower gross
profit percentages. The overall estimated gross profit for the nine months ended
March 31, 1998 was  approximately 21% as compared to nine months ended March 31,
1997 whereby the overall estimated  average gross profit was 28%.  Additionally,
the effect of change orders and certain  adjustments to estimated costs, as well
as the  interruption and termination of certain jobs, has resulted in reductions
of overall gross profit.

         For the nine months ended March 31, 1998 and 1997,  the Company paid $0
and $33,500,  respectively,  to MD for  material and labor  necessary to perform
steel erection services.  During September 1996, MD ceased  substantially all of
its  operations  and the  Company  began  purchasing  material  and  labor  from
unrelated third party steel fabricators.  At March 31, 1998, the Company owed MD
$47,220  principally  for advances in  connection  with above  services and such
amounts are non-interest bearing and due on demand.

         Below is a summary of the Company's  billings and  collections  for the
nine months ended March 31, 1998:
<TABLE>
<CAPTION>
                                    Gross contract
                                    and retainage           Allowances for       Net contracts
                                     receivables            uncollectible        receivables
                                     -----------            -------------        -----------
<S>                                  <C>                    <C>                  <C>        
Balances at June 30, 1997            $11,230,147            $(2,287,000)         $ 8,943,147

Billings                              14,489,359                     -            14,489,359
Collections                           12,747,888                128,000              128,000
                                     -----------           -----------          -----------
Balances at December 31, 1997        $12,971,618           $(2,159,000)         $10,812,618
                                     ===========           ===========          ===========
</TABLE>

         General and  administrative  expenses have increased by $304,621 or 18%
to $1,969,818  for the nine months ended March 31, 1998 from  $1,665,197 for the
nine months ended March 31, 1997. The increase in general  administration  costs
are mainly  attributable to an overall increase of the Company's  administrative
salaries  associated with the material  increase in contract revenue and certain
general corporate overhead.

         For the nine months  ended  March 31,  1998,  the  Company  recorded an
estimated income tax expense of $201,492 whereby for the nine months ended March
31, 1997, the Company recorded an estimated income tax expense of $301,000.


Liquidity and Capital Resources

         Of the  $10,812,618  of net contract and  retainage  receivables  as of
March 31,  1998,  the Company has only  collected  approximately  $815,000 or 8%
through  May  15,  1998.  The  timing  of the  collectibility  of  approximately
$7,800,000  which  represents  the  amount of net  receivables  associated  with
mechanic's  liens placed by the Company on certain jobs cannot be  determined by
the  Company  due  to  the  surrounding  circumstances  and  the  legal  process
associated in collecting funds whereby a lien has been placed on a project.  The
remainder of the receivables amounting to approximately  $2,200,000 are expected
to be collected during the first quarter of fiscal 1998.

         As a result of the slow  collection  process  associated with the above
circumstances,  the Company was unable to pay its  payroll tax  obligations  and
rent on a timely basis.  Upon the collection or settlement of a major portion of
contracts  receivable,  the Company's  first priority is to pay down its payroll
tax  obligations  as much as  possible.  The  accrued  and unpaid  rent has been
settled by the Company with the Company  issuing stock to its landlord RSJJ, via
its parent USABG Corp. ("Corp."), as well as the rent through December 1998.

                                       17
<PAGE>
         Although the lack of no new  contracts has an effect on revenue and net
income,  the Company is confident that,  based on its bidding  process,  it will
obtain  new  contracts.  Based  on the  Company's  backlog  at March  31,  1998,
amounting to approximately $600,000, and its vigorous attempts to collect on its
mechanic's liens and a portion of its contract receivables,  the Company expects
to generate  sufficient  cash flow to satisfy its cash  requirements  during the
next twelve months.

         Net cash provided by operating  activities amounted to $469,072 for the
nine months ended March 31, 1998.  The major  components of such use of cash was
directly  attributed to the Company's income amounting to $518,120 and increases
in accounts receivable net of decreases of its payroll taxes payable and accrued
expenses.  For the nine  months  ended  March  31,  1997,  the net cash  used by
operating activities amounted to $97,083 which were principally  attributable to
increases in account  receivables,  decreases in costs and estimated earnings in
excess of billings on uncompleted contracts and increases in accounts payable.

         With regards to investing activities,  the Company used $16,056 of cash
for the nine  months  ended  March  31,  1998.  Such  cash  was used  (advanced)
primarily for purchase of fixed assets and deposits towards restricted funds.

         As of March 31, 1998,  the Company  owes  approximately  $2,056,351  of
payroll taxes and related  estimated  penalties and  interest.  Although,  as of
March 31, 1998, the Company has not entered into any formal repayment agreements
with the respective tax  authorities,  it has been making payments based on oral
arrangements.

         In November 1997,  the Company  entered into an agreement with the Iron
Workers  Local 40, 361 and 417 Joint  Security  Funds (the  "Union") in order to
liquidate  $1,750,000 owed for unpaid union dues previously recorded as accounts
payable.  The Company agreed to pay $75,000 by January 1998 and at least $25,000
monthly commencing March 1, 1998 with interest at 9.5% per annum. As collateral,
the Company assigned its retainage  receivable from a certain project as well as
$1,750,000  of its  related  mechanic's  lien  (which  was  discharged  upon the
lien-debtor's  posting of a bond with the court).  Upon any funds being released
or paid  under such bond,  the Union will be repaid any  balance it is owed,  in
full,  and the Company  shall  receive the  remainder.  The Company will receive
credit for any payments received by the Union related to the assigned portion of
the bond. The total  remaining due at March 31, 1998 is $1,650,000 with $300,000
classified as current and the remainder of $1,350,000 classified as non-current.

         In February  1998,  the Company  agreed to issue 106,667  shares of its
common stock to Corp. as  consideration  to Corp.  for issuing shares of its own
stock to RSJJ in payment in full of the rent due by the  Company to RSJJ for the
period from  January 1, 1998 to December  31,  1998.  The value of the shares is
recorded at their  estimated  market  value at the date of issuance of $2.12 per
share, with a 50% discount due to the restricted nature of the stock.

         In December 1997, the Company authorized the issuance of 290,000 shares
of its common stock during the third  quarter of its fiscal year pursuant to its
Senior Management Incentive Plan. Of the 290,000 shares,  150,000 were issued to
the  Company's  President,  70,000 were issued to the Company's  Secretary,  and
70,000 were issued to the Company's Treasurer.  These shares vest 50% on June 1,
1998 and 50% on January 1, 1999.  The Company also  authorized and issued 50,000
shares  to  certain  of  its  employees  and  consultants:   these  shares  vest
immediately.  The Company authorized the filing of a Post-Effective Amendment to
the Form S-8 Registration Statement initially filed in February 1997 to register
the resale of management's shares. In connection with such issuance, the Company
recorded compensation and consulting expense amounting to approximately $255,000
which is based on 50% of the  average  closing  bid price of $1.50 per share for
the month of March 1998.  Management's  shares,  which do not vest  immediately,
have been recorded as deferred  compensation  and are being  amortized  over the
vesting period.

                                       18
<PAGE>
         On May 12,  1998,  the  Company  and Corp.  executed a letter of intent
whereby the Company shall acquire First Anglo-Swiss Holdings,  Inc. ("FAS"). The
letter provides,  among other things,  that the Company shall acquire 51% of the
outstanding  shares of common stock from the stockholders of FAS in exchange for
510,000 shares of the Company's Common Stock. Simultaneously with the closing of
the  acquisition,  Corp.  has agreed to sell all of its shares of Company Common
Stock to  Amalgamated  Resources  Management  S.A.  ("ARM") for an  aggregate of
$10,220,000.  Also at closing, the holders of FAS preferred stock shall exchange
all of such  shares for  shares of a series of  preferred  stock in the  Company
which shall carry the same rights and preferences as the shares of FAS preferred
stock.


                                     PART II

Item 1.  Legal Proceedings

         In April 1995,  the Company  commenced an Article 78  proceeding in the
Supreme  Court  of the  State of New  York,  County  of New  York,  against  the
Commissioners  of the State  Insurance  Fund and the State  Insurance  Fund.  In
December 1995, in the United States  District  Court,  Southern  District of New
York,  the  Commissioners  of the State  Insurance Fund for and on behalf of the
State Insurance Fund commenced suit against Joseph Polito, Ronald Polito, Steven
Polito,  the Company (f/k/a Metro Steel  Structures,  Ltd.),  One Carnegie,  and
others.  See the Company's Forms 10-QSB for the quarters ended December 31, 1997
and  September  30, 1997 for more  information  concerning  this  matter.  These
actions settled in April 1998 for $750,000.

         On February 25, 1997,  in New York State Supreme  Court,  Kings County,
the Company and Metro Steel  Structures,  Ltd.  commenced  suit  against  Perini
Corporation, Metropolitan Transportation Authority, New York City Transportation
Authority,  and Fidelity and Deposit Company of Maryland.  This action is in the
discovery  phase. See the Company's Forms 10-QSB for the quarters ended December
31, 1997 and September 30, 1997 for more information concerning this matter.

         On February 26, 1997, in New York State Supreme  Court,  Queens County,
the Company, Metro Steel Structures, Ltd., and McKay Enterprises, Inc. commenced
suit against Perini Corporation, Department of Transportation of the City of New
York,  and  Fidelity  and  Deposit  Company of  Maryland.  This action is in the
discovery  phase. See the Company's Forms 10-QSB for the quarters ended December
31, 1997 and September 30, 1997 for more information concerning this matter.

         On February 7, 1997,  in New York State  Supreme  Court,  Kings County,
Perini  Corporation  commenced  an action  against  the  Company and Metro Steel
Structures,  Ltd. This action is in the discovery phase. See the Company's Forms
10-QSB for the quarters  ended December 31, 1997 and September 30, 1997 for more
information concerning this matter.

         On or about  May 13,  1997,  in the New  York  Supreme  Court,  Suffolk
County, the Company commenced suit against Kiska Construction,  the State of New
York,  acting  through  the New  York  State  Comptroller,  the New  York  State
Department of Transportation, and the Seaboard Surety Company. This action is in
the  discovery  phase.  See the  Company's  Forms 10-QSB for the quarters  ended
December 31, 1997 and September 30, 1997 for more  information  concerning  this
matter.

         On October 14, 1997, the Company filed a mechanic's  lien in the amount
of $13,640,767  against EklecCo (f/k/a Pyramid Company of Rockland).  On October
16, 1997, in New York State Supreme Court,  Rockland County,  EklecCo  commenced
suit against the Company.  On February 9, 1998,  the plaintiff  posted a bond in
the  amount  of  $14,254,730  to secure  payment  of the  Company's  $13,640,747
mechanic's lien, interest, and court costs;  accordingly,  the court granted the
plaintiff's  motion to  discharge  said lien.  The court  further  ordered  that
discovery be expedited in this matter.  This action is in the  discovery  phase.
See the  Company's  Forms  10-QSB for the quarters  ended  December 31, 1997 and
September 30, 1997 for more information concerning this matter.

                                       19
<PAGE>
ITEM 2.  Changes In Securities And Use Of Proceeds:

         By Board of  Directors  Resolution  dated April 30,  1998,  the Company
decreased  the exercise  price of its warrants from $3.00 per share to $2.50 per
share.

ITEM 3.  Defaults Upon Senior Securities:   None

ITEM 4.  Submission Of Matters To A Vote Of Security Holders:  None,  except  as
         reported  in the  Company's  Form 10-QSB for the quarter ended December
         31, 1997.

ITEM 5.  Other Information:         None

ITEM 6.  Exhibits And Reports On Form 8-K:

         In January 1998,  the Company filed a Form 8-K, dated January 22, 1998,
wherein it reported  the results of its annual  meeting held on January 7, 1998.
In February 1998, the Company filed a Form 8-K, dated February 12, 1998, wherein
it reported the  resignation of Philip Nielson as a Director and the election of
Ronald Murphy as a Director.

                                       20
<PAGE>
                                   SIGNATURES


         In  accordance  with  Section  13 or 15(d)  of the  Exchange  Act,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned, thereunto duly authorized, this 21st day of May 1998.


                                           USA BRIDGE CONSTRUCTION OF N.Y., INC.



                                            By:      /s/ Joseph M. Polito
                                                --------------------------------
                                                Joseph M. Polito, President


                                                    /s/ Steven J. Polito
                                                --------------------------------
                                                Steven J. Polito, Treasurer