FORM 10-KSB\A1

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

(Mark One)

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

                     For the fiscal year ended June 30, 1998

                                       OR

[ ]  TRANSITION  REPORT  PURSUANT  TO  SECTION  13 OR  15(d)  OF THE  SECURITIES
     EXCHANGE  ACT OF 1934 [NO FEE  REQUIRED]  for the  transition  period  from
     _______________ to __________________

                         Commission file number 0-17449

                               PROCYON CORPORATION
                 (Name of small business issuer in its charter)

           Colorado                                             36-0732690
(State or other jurisdiction of                              (I.R.S. Employer
incorporation or organization)                            Identification Number)

   1150 Cleveland Street, Suite 410
        Clearwater, Florida                                       34615
(Address of principal executive offices)                        (Zip Code)

          Issuer's telephone number, including area code (813) 447-2998

           Securities registered pursuant to Section 12(b) of the Act:

                                      None

           Securities registered pursuant to section 12(g) of the Act:

                                  Common Stock

Check  whether  the  registrant  (1) filed all  reports  required to be filed by
Section 13 or 15(d) of the  Securities  Exchange  Act of 1934 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

Check if disclosure  of delinquent  filers in response to Item 405 of Regulation
S-B is not contained in this form, and no disclosure  will be contained,  to the
best of registrant's  knowledge,  in definitive proxy or information  statements
incorporated  by reference  in Part III of this Form 10-KSB or any  amendment to
this Form 10-KSB [ ]

State Issuer's revenues for its most recent fiscal year: $371,198

The  aggregate  market  value of the  1,176,455  shares of Common  Stock held by
non-affiliates  was $735,284 on September  30, 1998 based on the average bid and
asked price of $.625 on such date. As of September 30, 1998, 4,526,455 shares of
the issuer's Common Stock were outstanding.

                      DOCUMENTS INCORPORATED BY REFERENCE:

                                      None

Transitional Small Business Disclosure Format: Yes    No X

<PAGE>

                                      INDEX


Title                                                                       Page


ITEM  9.     DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL
             PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE
             ACT ...........................................................   3

ITEM 10.     EXECUTIVE COMPENSATION.........................................   4

ITEM 11.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
             MANAGEMENT.....................................................   5

ITEM 12.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.................   6


<PAGE>

                                    PART III

ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
        WITH SECTION 16(a) OF THE EXCHANGE ACT.

     The  directors  and  executive  officers of the  Company are listed  below.
Directors hold office until the next annual meeting of shareholders  and until a
successor is elected and qualified, or until their prior resignation.  Executive
officers are elected by the Board of Directors to serve until their  resignation
or their earlier removal by the Board.

     The following  material contains  information  concerning the directors and
executive  officers,  including  their  recent  employment,  positions  with the
Company, other directorships and age.

                                       Capacities in                   Director
       Name            Age              Which Served                    Since
       ----            ---              ------------                    -----

John C. Anderson        55     President, Chief Executive and            1994
                                Financial Officer, and Director
Chester L. Wallack      57     Director                                  1995
Fred W. Suggs, Jr.      52     Director                                  1995
Alan B. Crane           48     Director                                  1995

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

     John C. Anderson.  Mr. Anderson has served as a director of the Company and
also as its President and Chief Executive and Financial  Officer since November,
1994,  when he purchased a  controlling  interest in the  Company.  From 1989 to
1994, he served as President of Rush-In Mart, Inc., an import-export  firm doing
business  primarily in the former Soviet Union.  From 1978 to 1989, he served as
President of Stuffit Company,  Inc., a print and mail direct marketing firm with
over 300  employees  and  eleven  locations.  From  1970 to 1978,  he  served as
President  of Radius  International,  a firm  engaged  in retail  and  exporting
activities.  Mr. Anderson received a B.S. degree in Business Administration from
Kansas State University.

     Chester L. Wallack. Mr. Wallack serves as Chief Executive Officer of Felton
West,  Inc.,  a real  estate  development  and  construction  company  in Dover,
Delaware. Mr. Wallack is a retired United States Air Force officer having served
as a  pilot  and  in  various  management  capacities.  He  graduated  from  the
University  of Kansas  with a B.S.  degree  in  Industrial  Management  and from
Southern Illinois University with an M.B.A. degree in Finance.

     Fred W. Suggs, Jr. Mr. Suggs has been a practicing  attorney since 1975. He
is a partner in the  Greenville,  South  Carolina  office of Ogletree,  Deakins,
Nash,  Smoak & Stewart,  specializing  in labor and employment  law. He has been
certified as a specialist in labor and  unemployment  law by the South  Carolina
Supreme Court and is a frequent lecturer on labor and employment law issues. Mr.
Suggs graduated from Kansas State  University with a B.S. degree and he received
his J.D. degree from the University of Alabama.

     Alan B. Crane. Mr. Crane is a partner in Crane Farms, a farming partnership
in Larned, Kansas. In 1994, Mr. Crane was appointed by the governor of Kansas to
the Kansas Water Authority to oversee project  expenditures.  He received a B.S.
degree from Kansas State University.

                                       -3-

<PAGE>



Key Employee

     Ronald  L.  Maddix.  Mr.  Maddix  has  served  as the  President  and Chief
Executive Officer of the Company's  wholly-owned  subsidiary,  Amerx Health Care
Corporation, since July 1996. From February 1995 to June 1996, Mr. Maddix served
as President of  SunStates  Medical  Products,  Inc., a  distributor  of medical
capital  equipment.  From July 1993 to February  1995, he served as President of
Granitec  Corporation,  a manufacturer of building materials.  From July 1992 to
July 1993, he served as President of Environmed  International,  Inc., a medical
products  company.  From  March  1987 to July 1992,  Mr.  Maddix  served as Vice
President  of Marketing  for a  microsurgical  laser  manufacturer.  Mr.  Maddix
attended Parsons College majoring in Business Administration.

ITEM 10. EXECUTIVE COMPENSATION.

     Summary  Compensation  Table. The following table sets forth the annual and
long-term  compensation  for services in all  capacities  to the Company for the
three  fiscal years ended June 30, 1998,  1997 and 1996 of the  Company's  Chief
Executive  Officer  (the  "Named  Officer").  No other  officer  of the  Company
received  total  annual  salary and bonus in excess of $100,000  during the year
ended June 30, 1998.

<TABLE>
<CAPTION>
                                                            Long Term Compensation
                                                            ----------------------
                                                                    Awards
                                        Annual Compensation         ------
                               Fiscal   -------------------  Securities Underlying     All Other
Name and Principal Position     Year    Salary($)  Bonus($)     Options/SARs(#)     Compensation($)
---------------------------     ----    ---------  --------     ---------------     ---------------

<S>                             <C>     <C>         <C>              <C>                <C>  
John C. Anderson,               1998    $144,000    $  -0-            --                $ -0-
 President, Chief Executive     1997     144,000       -0-            --                  -0-
 and Financial Officer and      1996     144,000       -0-            --                  -0-
 Director
</TABLE>

     Option Grants Table. No grants of stock options were made during the fiscal
year ended June 30, 1998.

     Fiscal  Year-End  Options/Option  Values Table.  The Named Officer does not
have any options to purchase the Company's securities.

Compensation of Directors

     No employee of the Company  receives any  additional  compensation  for his
services as a director.  No non-employee  director receives any compensation for
his  service;  however,  the  Board  of  Directors  has  authorized  payment  of
reasonable  travel or other  out-of-pocket  expenses  incurred by non-management
directors  in  attending  meetings  of the  Board  of  Directors.  The  Board of
Directors may consider alternative director compensation  arrangements from time
to time.

Option Plan

     In 1987,  the Company  adopted an Incentive  Stock Option Plan  pursuant to
which  1,000,000  Common  Shares  were  available  for  issuance.  This plan was
designed to comply with  Section 422 of the Internal  Revenue  Code of 1986,  as
amended (the "Code"),  which  provides  that no incentive  option may be granted
more than ten  years  after  effectiveness  of the plan.  No  options  were ever
granted under this plan.

                                       -4-

<PAGE>



Board and Committee Attendance

     In fiscal year 1998, the Board of Directors held one formal meeting and all
directors  attended that board meeting.  There are no committees of the Board of
Directors.

Section 16(a) Beneficial Ownership Reporting Compliance

     Under the securities  laws of the United States,  the Company's  directors,
its  executive  officers,  and any persons  holding more than ten percent of the
Company's  Common Stock are required to report  their  initial  ownership of the
Company's  Common  Stock and any  subsequent  changes in that  ownership  to the
Securities and Exchange Commission and the Company. Specific due dates for these
reports  have been  established  and the Company is  required  to  disclose  any
failure to file, or late filing, of such reports.  Based solely on the Company's
review of Forms 3, 4 and 5 and amendments  thereto  furnished to the Company and
written representations with respect to filing of such Forms, the Company is not
aware of any failure to file,  or late filing,  of any such  reports  during the
1998 fiscal year.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     The following  table sets forth certain  information  regarding  beneficial
ownership of Common Stock as of October 27, 1998 by (i) each person known by the
Company to own beneficially  more than 5% of the outstanding  Common Stock, (ii)
each director or nominee,  and (iii) all  executive  officers and directors as a
group. Each person has sole voting and sole investment or dispositive power with
respect to the shares shown except as noted.  The address of each person  listed
is 1150 Cleveland Street, #410, Clearwater, Florida 54615.

                                               Shareholdings on October 27, 1998
                                               ---------------------------------
                                                   Number of       Percent of
     Name and Address                              Shares(1)          Class
     ----------------                              ---------          -----

John C. Anderson..............................     3,386,000           74.8%
Chester L. Wallack............................        60,000            1.3
Fred W. Suggs.................................       100,000            2.2
Alan B. Crane.................................        86,000            1.9
All directors and officers
  as a group (four persons)...................     3,632,000           80.2%

----------

(1)  Consists of 36,000, 60,000, 100,000 and 86,000 shares of Series A Preferred
     Stock owned by Messrs.  Anderson,  Wallack,  Suggs and Crane  respectively,
     which  Preferred  Stock is  convertible  into an equal  number of shares of
     Common Stock of the Company.  Such  conversion  occurs (i) at the option of
     the holder,  or (ii)  automatically,  effective as of the close of a public
     offering of Common Stock if such public offering satisfies certain size and
     price per share requirements.

                                       -5-

<PAGE>



ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     On January 31, 1996,  The Company  entered  into an  Agreement  and Plan of
Exchange (the  "Agreement") with Amerx Health Care Corp., a corporation based in
Clearwater,  Florida  ("Amerx").  The Agreement  provided that the Company would
acquire  Amerx  through  a  share  exchange  in  which  all  of the  issued  and
outstanding  common stock of Amerx would be  exchanged  for a total of 3,000,000
(post-split)  shares  of  Common  Stock of the  Company  (the  "Exchange").  The
Agreement  provided  that as a condition  to the  Exchange,  the  Company  would
complete a five for one reverse  split of its issued and  outstanding  shares of
Common Stock. The reverse stock split was approved by the Company's shareholders
on April 15, 1996.  The reverse stock split became  effective on May 8, 1996 and
the Exchange was completed as of May 9, 1996.  Prior to the Exchange,  Amerx was
wholly-owned by John C. Anderson.

     During fiscal 1995, Mr. Anderson advanced $348,363 to the Company which was
used to fund  operations  and an  investment in a  certificate  of deposit.  The
certificate  of deposit  was  pledged to  guaranty a letter of credit  which was
obtained  by  the  Company  in  order  to  finance  certain  proposed  inventory
purchases.  The anticipated inventory purchases were not made, and the letter of
credit was not used.  Effective July 1, 1995, Mr. Anderson converted $117,500 of
the advance  plus accrued  interest of $15,500  into paid in capital,  which was
accounted for as part of the Exchange. The remainder of the advances were repaid
during fiscal 1996  following  liquidation of the  certificate  of deposit.  Mr.
Anderson has continued to advance funds to the Company.  During fiscal 1998, Mr.
Anderson  advanced  $266,316 to the Company to fund  operations  and at June 30,
1998,  the Company owed him $213,316 on these advances which is represented by a
non-interest bearing note due June 30, 1999, collateralized by all of the assets
of the Company.

     At June 30, 1998, the Company had  outstanding a total of 1,341,000  shares
of its Preferred Stock. The Company's directors, consisting of Messrs. Anderson,
Wallack,  Suggs and Crane, have purchased a total of 297,000 shares of Preferred
Stock  at a price  of $1 per  share.  Such  purchases  were  made on  terms  and
conditions  which were  identical  to the  purchases  made by all other  private
investors.


                                       -6-

<PAGE>


                                   SIGNATURES

     Pursuant  to the  requirements  of  Section  13 or 15(d) 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.

                                          PROCYON CORPORATION


                                          By: /s/ John C. Anderson
                                             -----------------------------------
                                             John C. Anderson, President and 
                                             acting Principal Executive,
                                             Financial and Accounting Officer

Date: October 27, 1998

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

       Signature                       Title                         Date
       ---------                       -----                         ----


                              President and Acting           
                              Principal Executive, Financial 
/s/ John C. Anderson          and Accounting Officer            October 27, 1998
-------------------------     
John C. Anderson


/s/ Chester L. Wallack        Director                          October 27, 1998
-------------------------
Chester L. Wallack


/s/ Fred W. Suggs, Jr.        Director                          October 27, 1998
-------------------------
Fred W. Suggs, Jr.


/s/ Alan B. Crane             Director                          October 27, 1998
-------------------------
Alan B. Crane


                                       -7-