SECURITIES AND EXCHANGE COMMISSION
                               Washington, D.C. 20549





                                        FORM 10-Q

              (X)     Quarterly Report Pursuant to Section 13 or 15(d)
                        of the Securities Exchange Act of 1934

                      For the quarterly period ended   December 31, 1996

                                                        or

              ( )     Transition Report Pursuant to Section 13 or 15(d) of the
                        Securities Exchange Act of 1939

                      For the transition period from              to


Commission File Number:  0-18711




                            ACTRADE INTERNATIONAL, LTD.
      (Exact name of small business issuer as specified in its charter)




          Delaware                              13-3437739
(State or other jurisdiction of            (I.R.S. Employer
incorporation or organization)             Identification Number)


                       7 Penn Plaza, New York, NY  10001

                    (Address of principal executive offices)


Issuer's telephone number, including area code:       (212) 563-1036
                                                     -----------------


Check  whether the issuer (1) 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 X   No


Indicate the number of Shares  outstanding  of each of the  Issuer's  classes of
common stock, as of the latest practicable date.


            Class                          Outstanding at January 17, 1997

Common Stock, par value $0.0001
 per share                                               6,330,681




<PAGE>























                            INDEX



Part I.  Financial information


  Item 1.  Consolidated condensed financial statements:


                 Balance sheet as of December 31, 1996 and June
                  30, 1996                                            F-2

                 Statement of operations for six and three
                  months ended December 31, 1996 and 1995             F-3

                 Statement of changes in shareholders' equity         F-4

                 Statement of cash flows for the six months
                  ended December 31, 1996 and 1995                    F-5

                 Notes to consolidated condensed financial statements F-6- F-10



  Item 2.  Management's discussion and analysis of financial
            condition                                               F-11 - F-15


Part II.  Other information


Signatures

















                                                                         F-1


<PAGE>



                ACTRADE INTERNATIONAL, LTD. AND SUBSIDIARIES

                   CONDENSED CONSOLIDATED BALANCE SHEET

                    DECEMBER 31, 1996 AND JUNE 30, 1996
                               (Unaudited)



                               ASSETS

                                                   December 31,      June 30,
                                                      1996             1996
                                                      ----             ----

Current assets:
 Cash, including time deposits at June 30, 1996  $  528,559         $1,924,805
 Accounts receivable, less allowance for
  doubtful accounts of $25,000                    6,337,196          3,361,821
 Trade acceptance draft receivable, bank
  (Note 7)                                        2,814,330          2,578,015
 Accounts receivable, other                          17,379             77,164
 Prepaid expenses                                    35,053             24,815
 Interest receivable                                    443              3,162
                                                  ----------         ----------
     Total current assets                         9,732,960          7,969,782
                                                  ----------         ----------

Property and equipment:
  Furniture and fixtures                            206,325            161,829
  Leasehold improvements                            122,177            113,902
                                                  ----------         ----------
                                                    328,502            275,731
  Less accumulated depreciation                     187,654            172,026
                                                  ----------         ----------
                                                    140,848            103,705
                                                  ----------         ----------

Other asset, security deposits                       15,984             15,034
                                                  ----------         ----------

                                                 $9,889,792         $8,088,521
                                                 ==========         ==========



                                       LIABILITIES AND SHAREHOLDERS' EQUITY


Current liabilities:
  Cash advance from bank (Note 7)                $  675,705         $1,178,551
  Accounts payable                                1,546,414          1,872,880
  Consumer deposits                                                     55,954
  Accrued expenses                                    6,322             11,041
  Due to affiliates                                   3,126              3,126
  Income taxes payable (Note 6)                      46,735             21,302
                                                 ----------         ----------
    Total current liabilities                     2,278,302          3,142,854
                                                 ----------         ----------

Commitments (Note 5)

Deferred rent liability (Note 5)                     50,929             55,960
                                                 ----------         ----------

Shareholders' equity:
  Common stock, $.0001 par value;
   authorized 100,000,000 shares, issued and
   outstanding 6,330,681 at December 31, 1996
   and 5,683,181 at June 30, 1996                      633                568
  Common stock purchase warrants (Note 8)           87,500
  Additional paid in capital                     5,058,372          3,107,137
  Retained earnings                              2,414,056          1,782,002
                                                ----------         ----------
                                                 7,560,561          4,889,707
                                                ----------         ----------

                                                $9,889,792         $8,088,521
                                                ==========         ==========



     See notes to condensed consolidated financial statements.
                                                                          F-2


<PAGE>



                   ACTRADE INTERNATIONAL, LTD. AND SUBSIDIARIES

                  CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS

          FOR THE SIX AND THREE MONTHS ENDED DECEMBER 31, 1996 AND 1995
                                 (Unaudited)










                      Six Months Ended                  Three Months Ended
                         December 31,                       December 31,
                           1996         1995              1996         1995
                           ----         ----              ----         ----


Net sales              $16,458,567    $11,192,070      $8,880,533    $5,710,294

Cost of sales           14,860,738     10,228,629       7,956,924     5,189,983
                        -----------   -----------      ----------    ----------

Gross profit             1,597,829        963,441         923,609       520,311

Selling, general and
 administrative expenses   903,359        600,252         517,997       313,400
                        -----------   -----------      ----------    ----------

Income from operations     694,470        363,189         405,612       206,911
                        -----------   -----------      ----------    ----------

Other income (charges):
  Interest income           15,881         58,382           5,382        29,284
  Interest expense    (     31,562)      ( 63,928)       (  6,050)     ( 39,119)
                        -----------   -----------      ----------    ----------
                      (     15,681)      (  5,546)       (    668)      ( 9,835)
                        -----------   -----------      ----------    ----------

Income before income
 taxes                     678,789        357,643         404,944       197,076

Income tax expense
 (Note 6)                   46,735         18,681          32,765         1,910
                        -----------   -----------      ----------    ----------

Net income             $   632,054    $   338,962      $  372,179    $  195,166
                        ===========   ===========       ==========   ==========

Earnings per common share:
  Primary              $      0.11    $      0.06      $     0.06$         0.04
                        ===========   ===========       ==========   ==========
  Fully diluted        $      0.10    $      0.06       $     0.06      $  0.04
                        ===========   ===========       ==========   ==========

Weighted average common
 shares outstanding
 (Note 9):
   Primary               5,985,337      5,330,681        6,330,153    5,330,681
                        ===========   ===========        ==========  ==========
   Fully diluted         6,120,337      5,330,681        6,465,153    5,330,681
                        ===========   ===========        ==========  ==========













     See notes to condensed consolidated financial statements.
                                                                          F-3

<PAGE>



                           ACTRADE INTERNATIONAL, LTD. AND SUBSIDIARIES

                   CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY

                         FOR THE PERIOD JULY 1, 1994 TO DECEMBER 31, 1996
                                         (Unaudited)





<TABLE>
<CAPTION>
                             Common Stock                           Additional
                          $.0001 Par Value          Common Stock     Paid in      Retained
                            Shares    Amount     Warrants   Amount   Capital      Earnings      Total
                            ---------    ------  --------  ------    -------      --------      -----

<S>                         <C>        <C>      <C>       <C>       <C>           <C>         <C>
 

Balance at June 30, 1994    5,006,354  $ 501                        $1,474,331    $ 616,835   $2,091,667

Exercise of warrants          324,327     32                           567,542                   567,574

Net income for the year
 ended June 30, 1995                                                                407,793      407,793
                             ---------   ----      ------   -------  ----------  ----------   ----------

Balance at June 30, 1995    5,330,681     533                        2,041,873    1,024,628    3,067,034

Issuance of common stock      352,500      35                        1,065,264                 1,065,299

Net income for the year
 ended June 30, 1996                                                                757,374      757,374
                            ---------    ----      ------   -------  ----------  ----------    ----------

Balance at June 30, 1996    5,683,181      568                       3,107,137   1,782,002     4,889,707

Issuance of common stock      647,500       65                       1,951,235                 1,951,300

Exercise of common stock
 purchase warrants                                50,000    $87,500                               87,500

Net income for the six
 months ended December 31,
 1996                                                                             632,054        632,054
                             ---------     ----   ------  -------   ----------  ----------    ----------

Balance at December 31,      6,330,681     $633    50,000  $87,500   $5,058,372  $2,414,056    $7,560,561
1996                         =========     ====    ======  =======   ==========  ==========    ==========

</TABLE>






       See notes to condensed consolidated financial statements.
                                                                            F-4
<PAGE>



                     ACTRADE INTERNATIONAL, LTD. AND SUBSIDIARIES

                     CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

                       SIX MONTHS ENDED DECEMBER 31, 1996 AND 1995
                                        (Unaudited)




                                                         1996            1995
                                                         ----            ----

Cash flow from operating activities:
  Net income                                        $  632,054      $  338,962
  Adjustments to reconcile net income
   to cash provided from operating
   activities:
     Depreciation                                                       11,487
  Changes in operating assets and liabilities:
    Increase in accounts receivable                ( 3,211,690)    ( 1,660,030)
    Decrease in accounts receivable, other              59,785
    Increase in prepaid expenses                   (    10,238)    (    10,917)
    Increase (decrease) in interest receivable           2,719     (    58,335)
    Increase (decrease) in accounts payable        (   310,838)      1,018,461
    Decrease in accrued expenses                   (     4,719)    (     5,341)
    Increase in payroll taxes payable                                   25,880
    Increase in income taxes payable                    25,433          17,981
    Decrease in customer deposits                  (    55,954)
    Increase in security deposits                  (       950)
    Increase in deferred rent                      (     5,031)    (     3,618)
    Decrease in deferred taxes                                          13,439
                                                     ----------      ----------

    Net cash used in operating activities          ( 2,879,429)    (   312,031)
                                                     ----------      ----------

Investing activities:
  Use of cash:
    Purchase of property and equipment             (    52,771)    (    14,352)
                                                     ----------      ----------

    Net cash used in investing activities          (    52,771)    (    14,352)
                                                     ----------      ----------

Financing activities:
  Sources of cash:
    Proceeds from issuance of common stock           2,038,800
    Increase in cash advances from bank                               415,727
    Decrease in loans receivable, affiliates                          105,722
  Use of cash:
    Decrease in long-term debt                                    (    90,000)
    Decrease in cash advances, bank                (   502,846)
                                                     ----------      ----------

    Net cash provided from financing activities      1,535,954        431,449
                                                     ----------      ----------

Net increase (decrease) in cash                    ( 1,396,246)       105,066

Cash, beginning of period                            1,924,805      1,769,049
                                                     ----------    ----------

Cash, end of period                                 $  528,559     $1,874,115
                                                     ==========    ==========

Supplemental disclosures from cash flow information:
   Cash paid during the year for:
     Interest                                       $   37,251     $   25,109
                                                     ==========    ==========
     Income taxes                                   $   15,973     $      700
                                                     ==========    ==========





     See notes to condensed consolidated financial statements.
                                                                           F-5


<PAGE>



                        ACTRADE INTERNATIONAL, LTD. AND SUBSIDIARIES

                     NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                              SIX MONTHS ENDED DECEMBER 31, 1996
                                       (Unaudited)



     1. The accompanying  unaudited  financial  statements have been prepared in
accordance with generally accepted  accounting  principles for interim financial
information  and with the  instructions to Form 10-Q.  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,  all adjustments  considered  necessary for a fair presentation have
been  included.  The  results  of  operations  for the six  months  ended is not
necessarily  indicative  of the  results to be expected  for the full year.  For
further  information,   refer  to  the  consolidated  financial  statements  and
footnotes  thereto  included in the  Company's  annual report for the year ended
June 30, 1996, included in its Annual Report filed on Form 10-KSB. All reference
to  Actrade  in these  footnotes,  relate to Actrade  International,  Inc.,  the
Company's wholly owned subsidiary.  Actrade International,  Ltd., "The Company,"
is referred to as ACI.

2.  Organization of the Company:

     The Company, formerly Acquisition Capability, Inc., was incorporated in the
State of Delaware on April 3, 1987. On September 2, 1988,  the Company  acquired
100% of the issued and  outstanding  shares of Allstate Travel Corp., a New York
corporation incorporated on August 13, 1985 and Actrade International,  Corp., a
New York  corporation  incorporated  on July 18,  1985.  Allstate  operates as a
travel agency.  Actrade  represents various U. S. manufacturers and distributors
by buying and exporting their products overseas. Actrade Capital, Inc., a wholly
owned subsidiary of Actrade International, Ltd., was incorporated in Delaware in
May of  1991.  Amworld  offers  alternatives  to  existing  accounts  receivable
financing to both domestic and foreign companies. Standard Corporation, a wholly
owned foreign  corporation and subsidiary of Actrade  International,  Corp., was
incorporated  in Antigua and Bermuda on  February  12, 1988 and was  acquired in
January 1990. On December 22, 1991,  Standard  Corporation changed its corporate
name to Actrade South America. American Cooling, Inc., a wholly owned subsidiary
of Actrade  International,  Ltd.  was  incorporated  in Delaware in 1992 and was
inactive.  American Care Industries,  was incorporated in 1993 and was inactive.
American  Care  Industries,  Inc.  is  a  wholly  owned  subsidiary  of  Actrade
International,  Ltd.  Amworld  Credit,  Inc.  was  incorporated  in 1994 and was
inactive at September 1994.

     The Company sells  predominantly  in the foreign  market through its wholly
owned foreign subsidiary,  Actrade South America. There is no guarantee that the
foreign  market will  continue to develop since the  possibility  of foreign and
domestic government  intervention,  economic conditions world wide and any other
unforeseen situations may occur.

3.  Principles of consolidation:

     The consolidated  financial statements of Actrade  International,  Ltd. and
subsidiaries  include the accounts of all significant wholly owned subsidiaries,
after elimination of all significant intercompany transactions and accounts. The
accounts of Allstate Travel Corp., Actrade South America, a foreign corporation,
Actrade  Capital,   Inc.  and  American  Cooling,   Inc.  are  included  as  the
subsidiaries of Actrade International, Ltd.

                                                                           F-6


<PAGE>



                        ACTRADE INTERNATIONAL, LTD. AND SUBSIDIARIES

                     NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                              SIX MONTHS ENDED DECEMBER 31, 1996
                                      (Unaudited)



4.  Related party transactions:

    During each of the three years ended December 31, 1996, the Company and its
subsidiaries have advanced and received funds to and from related parties.  Such
receivable and payables are non-interest bearing and are due on demand.

  The Company  has  entered  into  several  employment  agreements  with its
    officers and shareholders.


5.  Leases:

     In February  1990,  the Company agreed with the lessor and sublessor of its
facilities  to  discontinue  its  sublease.  In the year ended June 30, 1991 the
Company  received $12,750 in settlement of the lease. The amount was recorded as
a reduction in selling,  general and administrative  expenses. In February 1990,
the Company  executed a lease  agreement with a related  corporation who was the
lessor of the facility from an unrelated  third party.  The lease in August 1991
was assigned to the Company from the related party.  The Company  simultaneously
assigned  said lease to Actrade in accordance  with the terms of the lease.  The
agreement  provides for monthly rentals of $4,200  (commencing June 1, 1991) and
annual increases of 4.5% and expires February 28, 2000.


     In lieu of rent for the first  fifteen  (15) months,  the Company  incurred
costs totaling approximately $87,000 for leasehold  improvements.  The leasehold
improvements  and the  total  rent  concessions  are being  amortized  using the
straight  line method over the entire term of the lease.  The  resulting  unpaid
rent over the abatement period is included in deferred rent liability.

   In December 1991,  Actrade entered into a non-cancelable  36 month operating
lease to house its Florida  office.  The lease provides for monthly  payments of
$653 plus cost of living  increases  annually,  capped @ 5% per annum. The lease
was renewed on December 24, 1994 for a three year period under the above terms.

     In August 1996,  Actrade  entered into a 12 month lease expiring August 31,
1997 with an Illinois  office  suite.  Both parties have the option to terminate
the lease with 30 days written  notice to either party on November 30, 1996. The
lease provides for monthly payments of $1,100 on the first day of each month.

     Future  minimum lease  payments  required  under  non-cancelable  operating
leases by fiscal year are as follows:

                        December 31, 1997                             $83,979
                        December 31, 1998                             $70,902
                        December 31, 1999                             $74,095
                        December 31, 2000                             $12,483


     Lease expense  amounted  to $41,713  and $37,780 for the six months  ended
       December 31, 1996 and 1995 respectively.



                                                                           F-7


<PAGE>



                      ACTRADE INTERNATIONAL, LTD. AND SUBSIDIARIES

                  NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                           SIX MONTHS ENDED DECEMBER 31, 1996
                                     (Unaudited)





6.  Income taxes:

    The components of income tax expense are:
                                                  Six months        Six months
                                                    Ended             Ended
                                                  December 31       December 31
                                                    1996              1995
                                                    ----              ----
    Income taxes currently payable:
      Federal                                    $ 33,134          $ 12,828
      State                                        17,006             4,773
                                                 --------           --------
                                                   50,140            17,601
                                                 --------           --------

    Deferred tax expense arising from:
      Excess of Financial accounting
       depreciation over tax                    (   1,443)        (     220)

      Excess of tax deductible rent over rent
       expense for financial accounting purposes(   1,962)            1,300
                                                  --------          --------
                                                (   3,405)            1,080
                                                 --------           --------

    Total income tax expense                     $ 46,735          $ 18,681
                                                 ========           ========


   Deferred income tax provisions resulting from differences between accounting
      for financial  statement  purposes and  accounting  for tax purposes are
        reflected above.

    A  reconciliation of income tax expense at the statutory rate to income tax
       expenses at the Company's effective rate is as follows:

                                                 Six months        Six months
                                                   Ended             Ended
                                                December 31        December 31
                                                    1996               1995
                                                   ----               ----
      Computed tax at the expected
       statutory rate                            $259,351           $137,620

      Surtax exemption                          (  16,750)         (  15,863)

      State income taxes, net of federal
          tax benefit                              17,006             18,304

      Foreign income                            ( 209,467)         ( 119,074)

      Tax benefit from utilization of net
       operating loss carryover                                    (   3,386)

      Other                                     (   3,405)             1,080
                                                 --------            --------

      Income tax expense                         $ 46,735           $ 18,681
                                                 ========           ========







                                                                           F-8


<PAGE>



                      ACTRADE INTERNATIONAL, LTD. AND SUBSIDIARIES

                 NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                         SIX MONTHS ENDED DECEMBER 31, 1996
                                 (Unaudited)






6.  Income taxes (continued):

    The effective statutory rate for 1996 was 39% for federal tax purposes.

     The  Company has made  adjustments  to  eliminate  the tax  provisions  for
foreign earnings since said earnings are  undistributed  and will be permanently
invested.   The  cumulative  amounts  of  foreign  undistributed   earnings  are
$2,495,444 at December 31, 1996 and $1,683,200 at December 31, 1995.

     The  Company has adopted  SFAS 109 for the fiscal  year  beginning  July 1,
1993.  SFAS 109 changes  accounting  for income taxes from the deferred  method,
required by APB-11 to the  asset/liability  method,  commonly referred to as the
liability method. The deferred method places primary emphasis on the matching of
revenues and expenses.  The  liability  method  places  primary  emphasis on the
valuation of current and deferred tax assets and  liabilities.  The significance
of the impact that SFAS 109 will have on the financial statements is expected to
be immaterial  and will have no impact on any other  significant  matters of the
Company.  The effect of  initially  adopting  SFAS 109 will be  reported  as the
cumulative effect of a change in accounting principle in accordance with APB-20.

7.  Trade Acceptance Drafts receivable, bank:

     As of December 31, 1996, Actrade Capital,  Inc., formerly Amworld Commerce,
Inc., a wholly owned  subsidiary of Actrade  International,  Ltd.,  had sold and
assigned all outstanding  Trade Acceptance  Drafts (TAD's) to Banco Portugues De
Atlantico  (Bank).  The total TAD amounts due from the banks were  $2,814,330 at
December 31, 1996.  The bank  purchases the TAD's at the face value and advances
these  amounts to Actrade  Capital,  Inc. The bank  purchases  the TAD's without
recourse and Actrade Capital,  Inc. has granted a security interest in all TAD's
purchased by the bank and all accounts  represented  by the TAD's  together with
all  guaranties  and  collateral,  and all proceeds of the above.  The bank will
purchase each TAD by advancing to Actrade  Capital,  Inc. 75% of the face amount
of each TAD assigned and  delivered  by overdraft on the Actrade  Capital,  Inc.
account.  At December 31, 1996 the advances on the overdraft account amounted to
$675,705. As each TAD is collateralized, the face amount will be credited to the
Actrade account to reduce the advanced overdraft. Interest is payable at 1% over
prime per annum on the outstanding advances,  which will be charged on the first
day of each month.












                                                                           F-9


<PAGE>



                      ACTRADE INTERNATIONAL, LTD. AND SUBSIDIARIES

                  NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

                           SIX MONTHS ENDED DECEMBER 31, 1996
                                   (Unaudited)






8.  Outstanding warrants to purchase common stock:

     At December  31,  1996,  the Company had  outstanding  warrants to purchase
135,000  shares of the  Company's  common stock at prices  ranging from $1.75 to
$2.25 per share. The warrants became  exercisable in 1996 and expire in 2001. At
December  31,  1996,  135,000  shares of common  stock  were  reserved  for that
purpose.

     In  December of 1996,  50,000  warrants  were  exercised  with  proceeds of
$87,500 to the Company. The common shares were issued in 1997.


9.  Reconciliation of shares used in computation of earnings per share:


                                                         1996            1995
                                                         ----            ----

         Primary weighted average of shares
           actually outstanding                       5,985,337       5,330,681

         Common stock purchase warrants                 135,000
                                                        -------

         Fully diluted weighted average common
           shares outstanding                         6,120,337       5,330,681
                                                      =========       =========






























                                                                        F-10


<PAGE>






ITEM 2.        MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
               CONDITION AND RESULTS OF OPERATIONS






I.      Results of Operations

During the first three  months of fiscal 1997,  ended  September  30, 1996,  the
Company has combined gross revenues of $7,578,034, as compared to $5,481,776 for
the first three  months of fiscal  1996.  During this  period,  cost of revenues
totaled  $6,903,814  (approximately  91% of  total  revenues),  as  compared  to
$5,038,646 (921% of total revenues).  This represented a slight decrease in cost
of revenues  when  expressed as a percentage  of total  revenues,  reversing the
trend  experienced  during fiscal 1995 and early 1996, when cost of revenues for
the 1996  first  quarter  rose from  88.3% of total  revenues  during  the first
quarter of fiscal  1995.  This  resulted in gross  profits  from  operations  of
$674,220 for the first  quarter of fiscal 1997,  an increase of almost  $231,090
(or approximately 52% higher than the first quarter of fiscal 1996). with income
from  operations  of $288,858 for this  period,  as compared to $156,278 for the
same period last year, an increase of approximately 84.8% over last year.

As discussed in the Company's 10-KSB for the year ended December 31, 1996, there
were two basic  reasons for the  escalating  higher cost of goods,  particularly
when expressed as a percentage of total revenues.  Essentially the nature of the
profit  margins  typical for the  operation  of both  Actrade  S.A.  and Actrade
Capital,  Inc.  ("Capital") have been significantly lower than those experienced
by the Company's other operating  divisions.  Consequently,  management believes
that escalation in cost of revenues experienced throughout fiscal 1995 and early
1996 was due to the changing "mix" in the Company's  revenues resulting from the
higher  percentage of total  revenues  represented  by Actrade S.S. and Capital.
During the first three months of fiscal 1997, in  combination,  Actrade S.A. and
Capital  represented  $5,566,459 of the Company's total revenues for the period,
or over 73%. Although,  in management's opinion, this percentage may continue to
show a further modest increase as Capital  accelerates its marketing  initiative
(see discussion below), management believes that the prior trend of accelerating
costs of revenues has now stabilized  and should not be a significant  factor in
the future.

As in the past,  management is unable to predict  whether or not the  relatively
low profit margins will persist with respect to revenues from Actrade S.A.
during the balance of fiscal 1997.

As a result of  management's  decision  to  substantially  accelerate  marketing
activities by Capital during fiscal 1997,  management  does not believe that the
comparison  of the first  quarter of fiscal 1997 to fiscal 1996 is indicative of
the results to be expected for all of fiscal 1997.  based upon the first quarter
of fiscal 1997,  and  management's  expected  results from its newly  introduced
marketing incentive for Capital, no estimate of operating results can be made at
this time, although management believes that the Company will, on a consolidated
basis,  continue  reflect net  operating  profits  above the levels  experienced
during fiscal 1996.










                                                                         F-11


<PAGE>








The  increase in gross  revenues  during  this period  (over 38% above the first
three months of fiscal  1996) was  primarily  due to the  expansion of Actrade's
operations  through (I) the continued  growth of Capital,  discussed  separately
below (see "III Actrade Capital,  Inc. And The Trade Acceptance Draft Program"),
and (ii) the continued growth within Actrade's existing product lines, including
Actrade S.A. As was the case during fiscal 1996, the increase in revenues during
this  period  resulted  from  increased  product  sales  rather  than from price
increases  for the  Company's  products  and  operating  revenues  derived  from
Capital.

As a result of foregoing  factors,  the Company's net operating income expressed
as a percentage of gross  revenues  increased  from 2.6% at the end of the first
quarter of fiscal 1996 to 3.4% at the end of the first  quarter of fiscal  1997.
For the reasons discussed above, management believes that this ratio will remain
stable  during  fiscal  1997.  Further,   management  believes  the  results  of
operations  for the first quarter of fiscal 1997 show the  continued  success of
the Company's expansion program and its cost cutting measures.

After  interest  income of $10,499 and interest  expense of $25,512  during this
period (compared to $29,098 and $24,809 respectively during the first quarter of
fiscal 1996),  and all allowance for income tax expense,  the Company realized a
net profit for the period of  $259,875  as  compared  to  $143,796  for the same
period last year, an increase of approximately 80.7%. Management attributes this
substantial  increase  principally  to the higher  revenues  from  Capital  (see
"Actrade Capital, Inc. And The Trade Acceptance Draft Program") below.

During the first  quarter of fiscal 1997,  Allstate  had, and continues to have,
extremely  limited  operations,   a  situation  expected  to  continue  for  the
foreseeable  future.  During the first three months of fiscal  1997,  Allstate's
total sales have aggregated only $4,253, which continue to account for less than
1/10 of 1% of the Company's total revenues for this period.


II.     Discussion of Financial Condition

On a consolidated  basis,  at September 30, 1996 the Company had total assets of
$8,980,608  (compared with  $8,088,521 at June 30, 1996, the end of fiscal 1996)
with total  liabilities  of  $2,223,021  (compared  with  $3,198,814 at June 30,
1996). Of the Company's assets at September 30, 1996, $1,920,876 was in the form
of cash  and  cash  equivalents  (compared  to  $1,924,805  at June  30,  1996),
$3,886,019  represents accounts  receivable  (compared to $3,361,821 at June 30,
1996),  and $2,884,817 was in the form of trade  acceptance  drafts  receivable,
bank (compared to $2,578,015 at June 30, 1996). The very slight decrease in cash
on hand at September 30, 1996 was  principally  due to routine  fluctuations  in
cash on hand  from the  Company's  operations..  The  increase  of  $520,565  in
accounts receivables  outstanding at September 30, 1996, as well as the decrease
in accounts payable  ($1,580,983 at September 30, 1996 compared to $1,872,880 at
June 30, 1996) was  principally  due to the normal effects of increased sales by
Actrade S.A.,  coupled with the Company's  election to pay down its  outstanding
payables  with a  portion  of the funds  received  from the  Company's  recently
completed  private  placement  of its  securities.  Similarly,  the  substantial
decrease in cash  advanced from bank,  which  represents  the Company's  advance
payment  from the sale of the  trade  acceptance  drafts  to its bank  under its
credit  agreements,  ($547,615 at September  30, 1996  compared to $1,178,551 at
June 30, 1996) also  represents  the election by the Company not to draw against
its available  credit lines with its bank but,  rather,  to utilize a portion of
the funds raised in its recently completed private placement.




                                                                         F-12


<PAGE>













The Company's accounts payable are all current.

At September 30, 1996 the Company had Retained Earnings of $2,041,877 with total
Shareholders'  Equity of $6,757,587,  compared with  $1,782,002 and  $4,889,707,
respectively,  at June 30, 1996. The principal source of funds for the Company's
operations are revenues earned by the Company's operating subsidiaries. However,
during the first quarter of fiscal 1997, the Company completed a further portion
of its recently  completed  private  placement of its securities and received an
additional  $1,658,250,  gross proceeds,  which also accounts,  in part, for the
substantial increase in Stockholders' Equity.

At September 30, 1996 the Company had property and equipment,  less  accumulated
depreciation,  of $104,864  (compared to $103,705 at June 30, 1996) and deferred
taxes and deposits of $13,970, compared to $21,302 at the end of fiscal 1996. In
connection with the Company's  relocation  during fiscal 1990, it received an 18
month rent abatement.  In conformity with  accounting  procedures,  the value of
this  abatement  is  amortized  over the  life of the  lease.  Consequently,  at
September  30,  1996 the Company  continued  to show  $53,444 in  deferred  rent
liability.

Based upon  available  cash on hand,  and  expected  revenues  from  operations,
management is of the opinion that it will have adequate  available funds to meet
its capital  expenditures  for the balance of fiscal  1997.  Thereafter,  future
capital  expenditures  will be decided  based  upon  operating  results  and net
revenues  from  operations.   At  present,  the  Company's  principal  expansion
activities involve the net revenues from operations.  At present,  the Company's
principal  expansion  activities involve the marketing of Capital's TAD Program,
which activities involve no significant capital expenditures.

Management  continues  to  investigate  new  product  lines for  addition to its
existing product offerings through its international trade division.

With respect to the Company's  working capital needs,  management  believes that
operating  revenues from its subsidiaries will continue to reflect a profit on a
consolidated  basis  during the  balance of fiscal 1997 and  management  expects
revenues  will be  adequate to meet the  Company's  operating  cash  needs.  The
Company plans to draw working  capital from cash on hand and operating  revenues
which are  expected to be adequate to meet the  Company's  requirements  for the
foreseeable future.

As of the date of this report,  of the Company's  total  accounts  receivable at
June 30, 1996, in the amount of $3,361,821 approximately 95% have been collected
and, of the balance, approximately $168,000 is secured by commercial documentary
drafts.














                                                                         F-13


<PAGE>










III.    Impact of Financial Service Division

During  fiscal  1994,  the first full year of  operations  for the TAD  Program,
although still in its  development  stage,  Capital  generated gross revenues of
$927,757 (as compared to $247,809  during  fiscal 1993)  resulting in a net loss
from  operations  for  Capital  of  $50,390.  Although  showing  a modest  loss,
Capital's operating results for fiscal 1994 exceeded management's  expectations.
During fiscal 1995, management  implemented an aggressive new marketing plan for
the TAD  Program,  principally  in  response  to the  perceived  need to educate
potential  participants in the TAD Program about how trade  acceptances work and
how they could benefit from the TAD Program.

As a result,  during  fiscal 1995,  Capital  generated  total gross  revenues of
$3,703,493,  almost  300%  higher  than  fiscal  1994,  which  resulted in a net
operating profit for fiscal 1995 of $7,153 - however, had management not elected
to make a year-end  allocation of indirect general and administrative  over-head
costs in the amount of $208,000,  net  operating  profits for Capital would have
been approximately $215,153.

Capital's  operating  revenues  during the first  quarter of fiscal 1997 totaled
$3,046,421,  or  approximately  40% of the Company's  total revenues during this
period as compared to total revenues of $1,522,564,  or  approximately  27.8% of
total revenues,  during the first quarter of fiscal 1996. Revenues for the first
quarter of fiscal 1997  represented an increase of  approximately  100% over the
same period last year.  During this period,  Capital also had interest income of
$10,499,  incurred selling,  general and administrative expenses of $158,986 and
interest expense of $25,479, which resulted in net operating income before taxes
of $22,620.


IV.     Trends Affecting Operations

Over the years  management  has  observed a  substantial  increase in demand for
American  made  products.  In  management's  opinion,  this is due to a  renewed
confidence  in quality of  American  products  and the  relative  weakness of US
dollar as compared to other major foreign currencies.  This has formed the basis
of the Company's operating  philosophy since 1989 and, in management's  opinion,
continues to favor continued growth over the foreseeable  future.  Combined with
the  recent  changes  in world  political  structures,  particularly  in Eastern
Europe,  management  believes  that world  demand  for  American  products  will
continue to increase at least over the foreseeable future.

Economic conditions in the United States have caused many American manufacturers
to seek new markets for their  product  and, in  particular,  to turn to foreign
markets to boost domestic sales.  Management  believes that this trend,  coupled
with renewed demand for American  products and improved  buying power of foreign
currencies,  has been  beneficial  to the Company and has been a major factor in
its growth over the past three years. This trend, although expected to continued
for the foreseeable  future,  is now being affected by a number of other factors
which could  adversely  affect  future  growth rates for the  Company's  present
operations.










                                                                           F-14


<PAGE>









Recently,  management  has  observed  that,  with the  collapse  of  traditional
political and  ideological  barriers,  the demand for products from all parts of
the world has increased perceptibly with many developing and third world nations
now  looking  for  products  from  many  different  countries.   This  has  been
particularly  true of countries  with "soft"  currencies  (i.e.  currencies  not
readily  exchangeable  into  established  currencies such as British pounds,  US
dollars,  etc.),  such as the  emerging  countries of Eastern  Europe,  which at
present are unable to pay for their purchases in US dollars. Management believes
that the greatest demand for all kinds of foreign products (including those from
US and other industrial  nations) will be seen from these newly developing third
world  countries over the next few years.  To meet this changing  market demand,
the Company initiated an expansion of Actrade's  operations by providing foreign
sources for products.

Over the  long-term,  as the US  economy  continued  to  improve  and the dollar
strengthens with respect to other currencies,  foreign buying power for American
products may decrease  causing foreign buyers to look for  comparable,  but less
expensive,  products from other sources. Although it is impossible to predict at
this time the  extent to which this  trend may  affect  the  competitiveness  of
American products overseas,  it is likely that any significant decline in buying
power of foreign  currencies  will have an  adverse  impact  upon the  Company's
present  operations.  Although no assurances can be given,  management  believes
that by  utilizing  its  foreign  network  both to promote new sales of American
products and as a source of comparable,  less  expensive  foreign made products,
the Company will gain the  flexibility  needed to meet changing  product demands
over the coming years.

Management  knows of no other  trends  reasonably  expected  to have a  material
impact upon the Company's operations or liquidity in the foreseeable future.


Part II.  Other information


Item 6. Exhibits and Reports on Form 8-K

        None during this report






ITEM 2.           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

I.  Results of Operations

During the first six months of fiscal 1997, ended December 31, 1996, the Company
had combined gross revenues of  $16,458,587,  as compared to $11,192,070 for the
first  six  months  of  fiscal  1995,  which  represented  an  increase  of over
$5,260,000 in gross revenues  (almost 47%) above the same period in fiscal 1996.
During the current period, the Company reported gross profits from operations of
$1,597,829,  an increase of $634,388 (or approximately  66%) from the first half
of fiscal 1996,  with incomes from  operations  of $694,470 for this period,  as
compared to $363,189 for the same period last year.  After  interest  income and
expenses and provisions for income taxes,  the Company  experienced net earnings
of  $632,054,  as  compared  to  $338,962  for the first half of fiscal 1996 (an
increase of over 86%), or $0.10 per share for the six months ended  December 31,
1996 as compared to $0.06 for the same period last year.

Total cost of  revenues  from  operations  during the first half of fiscal  1996
reached $14,860,738, an increase of slightly more than $4,630,000 from the first
half of fiscal 1996.  Although  cost of revenues  continued at the higher levels
experienced  during  fiscal  1996,  cost of revenues  continued  to level off, a
process begun during the first quarter of fiscal 1997,  and when  expressed as a
percentage  of total  revenues  dropped to 90.3%,  as compared to  approximately
91.3% for the first six months of fiscal 1996,  and slightly  lower than the 91%
reported for the first quarter of fiscal 1997.

As  previously  reported,  the basic  reasons  for the higher  costs of revenues
experienced  during  fiscal 1996 relate to the changing  "mix" of the  Company's
revenues  resulting from the higher percentage of total revenues  represented by
Actrade S.A. and Actrade Capital, inc. ("Capital"), and the fact that the profit
margins  typical for the  operations of both Actrade S.A. and Capital have been,
and are expected to continue to be,  significantly  lower than those experienced
by the Company's other operating  division.  However,  in management's  opinion,
although this ratio may continue to show modest future  fluctuations  as Capital
accelerates  its marketing  initiative  for the TAD Program,  the prior trend of
accelerating  costs  of  revenues  has  now  stabilized  and  should  not  be  a
significant factor in the future.

With respect to the three months ended December 31, 1996, gross revenues reached
$8,880,533 (up over 55.5% from the second quarter of fiscal 1996); gross profits
climbed to $923,609 (an  increase of just over 77.5% from the second  quarter of
fiscal 1996); income from operations totaled $405,612 (up over 96% from the same
period in fiscal 1996);  and net earnings after interest income and expenses and
allowances  for income  taxes  reached  $372,179 (an increase of over 90.6% from
fiscal  1996),  or $0.06 per share for the quarter  ended  December  31, 1996 as
compared  to $0.04  per share  for the  second  quarter  of  fiscal  1996.  Most
importantly,  however,  the results for this three month  period  shows that the
cost of revenues  dipped to 89.6% for the three months ended  December 31, 1996.
As discussed  above,  management  believes that this indicates a leveling off of
the increased  costs  associated  with the TAD Program which should  continue at
least for the balance of fiscal 1997.

As previously reported, due to management's decision to substantially accelerate
marketing  activities by Capital during the current fiscal year, no estimates of
operating results can be made at this time.  However,  management  believes that
the Company  will, on a  consolidated  basis,  continue to reflect  revenues and
operating profits for the balance of fiscal 1997 at levels above those reflected
for the first six months.

The increase in gross revenues during this period  continues to be due primarily
to the expansion of Actrade's  operations  through (i) the  continued  growth of
Capital's TAD Program,  discussed  separately  below (see "III.  Actrade Capital
Inc. And The Trade  Acceptance  Draft  Program"),  and (ii) the continued growth
within Actrade's existing product lines,  including Actrade S.A. As was the case
during fiscal 1996,  the increase in revenues  during this period  resulted from
increased  product  sales  rather than from price  increases  for the  Company's
products and operating revenues derived from Capital.





<PAGE>



As a result of the foregoing factors,  the Company's  operating income expressed
as a percentage of gross revenues continued its rise and reached 4.2% at the end
of the first half of fiscal 1997,  compared to slightly  over 3.0% at the end of
the first half of fiscal 1996. For the reasons discussed above,  management does
not expect this ratio to decrease  during the balance of fiscal  1997.  Further,
management  believes  that the  result of  operations  during  the first half of
fiscal  1997  clearly  demonstrates  the  continued  success  of  the  Company's
expansion program and its cost cutting measures.

Allstate had, and continues to have,  extremely limited operations,  a situation
expected to continue for the foreseeable future. During the first half of fiscal
1997,  Allstate's  total sales have  aggregated  only $7,937,  which continue to
account  for less  than  1/20 of 1% of the  Company's  total  revenues  for this
period.

II.  Discussion of Financial Condition

On a  consolidated  basis,  at December 31, 1996 the Company had total assets of
$9,889,792  (compared with  $8,088,521 at June 30, 1996, the end of fiscal 1996)
with total  liabilities  of  $2,329,231  (compared  with  $3,198,814 at June 30,
1996).  Of the Company's  assets at December 31, 1996, $ 528,559 was in the form
of  cash  and  cash  equivalent  (compared  to  $1,924,805  at June  30,  1996),
$6,337,196   represents  accounts  receivable,   excluding  TADs,  (compared  to
$3,361,821  at  June  30,  1996)  and  $2,814,330  in  Trade  Acceptance  Drafts
receivable  (with  a  corresponding  liability  of  $675,705  representing  cash
advanced from Capital's  bank,  which  represents the Company's  advance payment
from  the  sale  of  trade  acceptance  drafts  to its  bank  under  its  credit
agreements).  The  decrease in cash on hand,  accounts  payable and cash advance
from bank at December 31, 1996 was  principally  due to utilization of available
cash on hand in connection with Capital's TAD Program and to reduce,  and/or not
to further utilize,  the Company's  available credit lines and related payables,
as reflected in the  significantly  lower  liabilities at December 31, 1996. The
increase of $2,975,375 in accounts receivables  outstanding at December 31, 1996
was  principally  due to the  increased  revenues  generated  by Actrade and the
effects of increased  sales by Actrade S.A. As  previously  reported,  the funds
utilized by the Company during this period for the purposes discussed above were
primarily derived from the Company's recently concluded private placement of its
common stock.

The Company's accounts payable are all current.

At December 31, 1996 the Company had Retained  Earnings of $2,414,056 with total
Stockholder's  Equity of $7,560,561,  compared with  $1,782,002 and  $4,889,707,
respectively,  at June 30, 1996. The principal source of funds for the Company's
operations are revenues earned by its operating  subsidiaries.  However,  during
the first quarter of fiscal 1997 the Company  completed a further portion of its
recently  completed private placement of its securities and received  additional
gross  proceeds of  $1,658,250.  In addition,  in December 1996 the Company also
received  $87,500  from a  consultant  to the  Company  who  elected to exercise
certain  outstanding  warrants to purchase 50,000 shares of the Company's common
stock.  These items  contributed  significantly to the increase in Stockholders'
Equity at December 31, 1996.

At December 31, 1996 the Company had property, less accumulated depreciation, of
$140,848,  (compared to $103,705 at June 30, 1996) and other assets and deposits
of $15,984,  compared to $15,034 at the end of fiscal 1996. In  connection  with
the  Company's  relocation  during  fiscal  1990,  it  received an 18 month rent
abatement. In conformity with accounting procedures, the value of this abatement
is amortized over the life of the lease. Consequently,  at December 31, 1996 the
Company continued to show $50,929 in deferred rent liability.

Based upon  available  cash on hand,  and  expected  revenues  from  operations,
management is of the opinion that it will have adequate  available funds to meet
its capital  expenditures  for the balance of fiscal  1997.  Thereafter,  future
capital  expenditures  will be decided  based  upon  operating  results  and net
revenues from operations.  The Company's principal expansion  activities involve
marketing Capital's accounts receivable financing program,  which activities are
expected to involve significant capital expenditures.





<PAGE>



With respect to the Company's  working capital needs,  management  believes that
operating  revenues from its subsidiaries will continue to reflect a profit on a
consolidated  basis  during the  balance of fiscal 1997 and  management  expects
revenues  will be  adequate to meet the  Company's  operating  cash  needs.  The
Company plans to draw working  capital from cash on hand and operating  revenues
which are  expected to be adequate to meet the  Company's  requirements  for the
foreseeable future.

As of the date of this Report, all of the Company's total accounts receivable at
June 30,  1996,  in the  amount  of  $3,361,821,  approximately  99%  have  been
collected  and of the  balance  approximately  $35,000 is secured by  commercial
documentary drafts.


III.  Actrade Capital Inc. And The Trade Acceptance Draft Program.

During  fiscal  1994,  the first full year of  operations  for the TAD  Program,
although still in its  development  stage,  Capital  generated gross revenues of
$927,757 (as compared to $247,809  during  fiscal 1993)  resulting in a net loss
from  operations  for  Capital  of  $50,390.  Although  showing  a modest  loss,
Capital's operating results for fiscal 1994 exceeded management's  expectations.
During fiscal 1995, management  implemented an aggressive new marketing plan for
the TAD  Program,  principally  in  response  to the  perceived  need to educate
potential  participants in the TAD Program about how trade  acceptances work and
how they could benefit from the TAD Program.

As a result,  during  fiscal 1995,  Capital  generated  total gross  revenues of
$3,703,493,  almost  300%  higher  than  fiscal  1994,  which  resulted in a net
operating profit for fiscal 1995 of $7,153 - however, had management not elected
to make a year-end  allocation of indirect general and administrative  over-head
costs in the amount of $208,000,  net  operating  profits for Capital would have
been approximately $215,153.

Capital's  operating  revenues  during  the first  half of fiscal  1997  totaled
$7,312,871,  or approximately  44.4% of the Company's total revenues during this
period, as compared to total revenues of $3,598,931,  or approximately  32.2% of
the  Company's  total  revenues  during  the  first  half  of  fiscal  1996  and
$1,509,065,  or approximately 19.2% of total revenues,  during the first half of
fiscal 1995. Perhaps most importantly  however,  Capital's gross revenues during
this period were more than 103% higher than the same period in fiscal  1996.  In
addition, confirming management's expectations, revenues during the three months
ended December 31, 1996 were $4,266,450,  an increase of approximately  40% over
gross revenues reported for the first three months of fiscal 1997.

During this  period,  Capital  also had  interest  income of  $15,881,  interest
expenses of $31,322 and incurred selling, general and administrative expenses of
$340,021 which resulted in operating  income from  operations,  before taxes, of
$118,922,  as  compared  to $77,080  for the first six months of fiscal 1996 (an
increase of over 54%).  After a provision  for income taxes of $12,417,  Capital
had net income from  operations of $91,064 for the six months ended December 31,
1996


 IV.  Trends Affecting Operations

Over the years  management  has  observed a  substantial  increase in demand for
American  made  products.  In  management's  opinion,  this is due to a  renewed
confidence in the quality of American  products and the relative weakness of the
US dollar as  compared to other major  foreign  currencies.  This has formed the
basis of the  Company's  operating  philosophy  since 1989 and, in  management's
opinion,  continue's  to favor  continued  growth over the  foreseeable  future.
Combined with the recent changes in world political structures,  particularly in
Eastern Europe, management believes that world demand for American products will
continue to increase at least over the foreseeable future.





<PAGE>



Economic conditions in the United States have caused many American manufacturers
to seek new markets for their  products and, in  particular,  to turn to foreign
markets to boost domestic sales.  Management  believes that this trend,  coupled
with renewed demand for American  products and improved  buying power of foreign
currencies,  has been  beneficial  to the Company and has been a major factor in
its growth over the past three years. This trend,  although expected to continue
for the foreseeable  future,  is now being affected by a number of other factors
which could  adversely  affect  future  growth rates for the  Company's  present
operations.

Recently,  management  has  observed  that,  with the  collapse  of  traditional
political and  ideological  barriers,  the demand for products from all parts of
the world has increased perceptibly with many developing and third world nations
now  looking  for  products  from  many  different  countries.   This  has  been
particularly  true of countries  with "soft"  currencies  (i.e.  currencies  not
readily  exchangeable  into  established  currencies such as British pounds,  US
dollars,  etc.),  such as the  emerging  countries of Eastern  Europe,  which at
present are unable to pay for their purchases in US dollars. Management believes
that the greatest demand for all kinds of foreign products (including those from
the US and other  industrial  nations) will be seen from these newly  developing
third world  countries  over the next few years.  To meet this  changing  market
demand,  the Company initiated an expansion of Actrade's  operations through the
establishment  of  Actrade  S.A.,  which  is  intended  to  compliment   current
operations by providing foreign sources for products.

Over the long  term,  as the US  economy  continues  to  improve  and the dollar
strengthens with respect to other currencies,  foreign buying power for American
products may decrease  causing foreign buyers to look for  comparable,  but less
expensive,  products from other sources. Although it is impossible to predict at
this time the  extent to which this  trend may  affect  the  competitiveness  of
American products overseas,  it is likely that any significant decline in buying
power of foreign  currencies  will have an  adverse  impact  upon the  Company's
present  operations.  Although no assurances can be given,  management  believes
that by  utilizing  its  foreign  network  both to promote new sales of American
products and as a source of comparable,  less  expensive  foreign made products,
the Company will gain the  flexibility  needed to meet changing  product demands
over the coming years.

Management  knows of no other  trends  reasonably  expected  to have a  material
impact upon the Company's operations or liquidity in the foreseeable future.


Part II.  OTHER INFORMATION


Item 6.  Exhibits and Reports on Form 8-K

None during this period.









<PAGE>






                                              SIGNATURES




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



Dated: January 22, 1997



ACTRADE INTERNATIONAL, LTD.



BY:_/s/Amos Aharoni________________
   Amos Aharoni,
   Chief Executive Officer