<PAGE>   1
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                    FORM 10-K
(Mark One)
[X]       ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
          EXCHANGE ACT OF 1934 [FEE REQUIRED]

                    FOR THE FISCAL YEAR ENDED APRIL 30, 2001

                                       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: 0-17168

                       FASTCOMM COMMUNICATIONS CORPORATION
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


         VIRGINIA                                           54-1289115
-----------------------------------------       --------------------------------
(State or other jurisdiction of                         (I.R.S. Employer
 incorporation or organization)                      Identification Number)

     45472 HOLIDAY DRIVE
      DULLES, VIRGINIA                                       20166
-----------------------------------------       --------------------------------
(Address of principal executive offices)                   (Zip Code)


        Registrant's Telephone Number, including area code: 703/318-7750
        Securities registered pursuant to Section 12(b) of the Act: None.
          Securities registered pursuant to Section 12(g) of the Act:

                     COMMON STOCK, PAR VALUE $.01 PER SHARE
--------------------------------------------------------------------------------
                                (Title of Class)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.
Yes   X       No
    -----

APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities a plan
confirmed by a court.   Yes   X       No
                            -----

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

The aggregate market value of the Common Stock of the registrant held by
non-affiliates of the registrant, computed by reference to the last sale price
of such shares as of the close of trading on July 26, 2001 was $11,153,302
(24,785,116 shares times $0.45). As of July 26, 2001, there were 29,066,624
shares of the Common Stock of the registrant outstanding.

Documents Incorporated By Reference: None
<PAGE>   2


                       FASTCOMM COMMUNICATIONS CORPORATION

                                    FORM 10 K

                        FOR THE YEAR ENDED APRIL 30, 2001

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                          PART I.                                          PAGE

<S>              <C>                                                                  <C>
Item 1.            Description of Business.                                                   3
Item 2.            Description of Properties.                                                10
Item 3.            Legal Proceedings.                                                        10
Item 4.            Submission of Matters to Vote of Security Holders.                        11
</TABLE>

<TABLE>
<CAPTION>
                                         PART II.                                          PAGE

<S>              <C>                                                                     <C>
Item 5.            Market for Registrant's Common Equity and Related Stockholder Matters.    12
Item 6.            Selected Financial Data.                                                  13
Item 7.            Management's Discussion and Analysis of Financial Condition and
                   Results of operations.                                                    14
Item 7A            Market Risk                                                               26
Item 8.            Financial Statements and Supplementary Data.                              27
Item 9.            Changes in and Disagreements with Accountants on Accounting               28
                   and Financial Disclosure
</TABLE>

<TABLE>
<CAPTION>
                                         PART III.                                         PAGE

<S>              <C>                                                                     <C>
Item 10.           Directors and Executive Officers of the Registrant.                       29
Item 11.           Executive Compensation.                                                   31
Item 12.           Security Ownership of Certain Beneficial Owners and Management.           34
Item 13.           Certain Relationships and Related Transactions.                           36
</TABLE>


<TABLE>
<CAPTION>
                                         PART IV.                                          PAGE

<S>              <C>                                                                    <C>
Item 14.           Exhibits, Financial Statement Schedules, and Reports on
                   Form 8-K.                                                                 37
</TABLE>



                                       2
<PAGE>   3


                   SPECIAL NOTE ON FORWARD-LOOKING STATEMENTS

THIS ANNUAL REPORT ON FORM 10-K CONTAINS "FORWARD-LOOKING STATEMENTS" WITHIN THE
MEANING OF AND MADE UNDER THE SAFE HARBOR PROVISIONS OF SECTION 27A OF THE
SECURITIES ACT OF 1933 (THE "SECURITIES ACT") AND SECTION 21E OF THE SECURITIES
EXCHANGE ACT OF 1934 (THE "EXCHANGE ACT"). FROM TIME TO TIME, WE MAY PUBLISH OR
OTHERWISE MAKE AVAILABLE FORWARD-LOOKING STATEMENTS OF THIS NATURE.
FORWARD-LOOKING STATEMENTS INCLUDE STATEMENTS CONCERNING PLANS, OBJECTIVES,
GOALS, STRATEGIES, FUTURE EVENTS OR PERFORMANCE, AND UNDERLYING ASSUMPTIONS AND
OTHER STATEMENTS, WHICH ARE NOT HISTORICAL FACTS. THE WORDS "MAY", "COULD",
"SHOULD", "WILL", "PROJECT", "INTEND", "CONTINUE", "BELIEVE", "ANTICIPATE",
"ESTIMATE", "EXPECT", "PLAN", "INTEND" AND SIMILAR EXPRESSIONS ARE INTENDED TO
IDENTIFY FORWARD LOOKING STATEMENTS. EXAMPLES OF FORWARD-LOOKING STATEMENTS
INCLUDE STATEMENTS REGARDING, AMONG OTHER MATTERS, OUR PLANS, INTENTIONS,
BELIEFS AND EXPECTATIONS ABOUT THE FOLLOWING:

OUR FUTURE PROSPECTS, INCLUDING OUR REVENUES, INCOME, MARGINS, PROFITABILITY,
CASH FLOW, LIQUIDITY, FINANCIAL CONDITION AND RESULTS OF OPERATIONS;

OUR BUSINESS PLANS AND STRATEGIES;

THE RISKS AND UNCERTAINTIES RELATED TO OUR BUSINESS;

OUR PRODUCTS AND SERVICES, MARKET POSITION, MARKET SHARE, BUSINESS, GROWTH
STRATEGIES AND STRATEGIC RELATIONSHIPS;

INDUSTRY TRENDS, COMPETITIVE CONDITIONS AND MARKET CONDITIONS, SEGMENTS AND
TRENDS;

THE SUFFICIENCY OF FUNDS FROM OPERATIONS AND AVAILABLE BORROWINGS TO MEET OUR
FUTURE WORKING CAPITAL AND CAPITAL EXPENDITURE NEEDS;

THESE FORWARD-LOOKING STATEMENTS ARE BASED ON THE CURRENT PLANS, INTENTIONS,
BELIEFS AND EXPECTATIONS OF MANAGEMENT AS WELL AS ASSUMPTIONS MADE BY AND
INFORMATION CURRENTLY AVAILABLE TO MANAGEMENT. YOU ARE CAUTIONED NOT TO PLACE
UNDUE RELIANCE ON THESE FORWARD-LOOKING STATEMENTS. FORWARD-LOOKING STATEMENTS
ARE SUBJECT TO SUBSTANTIAL RISKS AND UNCERTAINTIES. ANY OR ALL OF THESE
FORWARD-LOOKING STATEMENTS COULD TURN OUT TO BE WRONG. FORWARD-LOOKING
STATEMENTS WILL BE AFFECTED BY INACCURATE ASSUMPTIONS WE MIGHT MAKE OR BY KNOWN
OR UNKNOWN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THOSE EXPRESSED OR IMPLIED BY THE FORWARD-LOOKING STATEMENTS.
THESE RISKS AND UNCERTAINTIES INCLUDE, BUT ARE NOT LIMITED TO, THE FACTORS
DESCRIBED UNDER "ADDITIONAL FACTORS THAT MAY AFFECT OUR BUSINESS AND FUTURE
RESULTS" IN ITEM 5 BELOW, AS WELL AS OTHER RISKS AND UNCERTAINTIES DISCUSSED
ELSEWHERE IN THIS REPORT, IN DOCUMENTS INCORPORATED BY REFERENCE IN THIS REPORT
AND IN OUR OTHER REPORTS AND FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION
("SEC"). WE UNDERTAKE NO DUTY OR OBLIGATION TO UPDATE OR REVISE ANY
FORWARD-LOOKING STATEMENTS FOR ANY REASON, WHETHER AS A RESULT OF NEW
INFORMATION, FUTURE EVENTS OR OTHERWISE.


                                     PART I.

ITEM 1.   DESCRIPTION OF BUSINESS

INTRODUCTION

FastComm Communications Corporation (the "Company" or "FastComm") designs,
develops and manufactures signaling protocol conversion products that bridge the
gaps that exist between incompatible communications networks, integrated access
devices that serve as advanced voice/data/video/data convergence routers for
enterprise and carrier users and protocol converters specifically designed for
Unisys environments. FastComm also provides advanced internet protocol (IP) and
data solutions over Frame Relay as well as voice/data integrated access devices
(IAD's) and data routers.

The Company's goal is to provide customers with leading edge technology and a
cost-effective means of

                                       3
<PAGE>   4

incorporating these technologies into existing or new networks. FastComm is
positioning itself in the evolving converged networks with a customer base that
includes domestic and international corporations, carriers, internet service
providers, competitive local exchange carriers, State and Federal government
agencies as well as other telecommunications manufacturers.

The Company targets business customers and designs its products for volume sales
through third party resellers such as network product and service dealers,
systems integrators, telephone carriers and original equipment manufacturers.
These resellers form a primary distribution channel for the Company and also
provide installation and maintenance support services.

The Company was incorporated as MicroTel, Inc. under the laws of the
Commonwealth of Virginia in May 1983. The Company changed its name to Data Safe
Incorporated in February 1984; to Electronic Vaults, Inc., in August 1984; and
to FastComm Communications Corporation, in October 1987.

During the fiscal year ended April 30, 1997, the Company acquired Comstat
Datacomm Corporation, ("CDC or Comstat"), a Georgia corporation engaged in the
data communications business.

On March 31, 2000, the Company completed its acquisition of substantially all of
the assets and certain liabilities of Cronus Technology, Inc., ("Cronus") a
privately held Illinois corporation that designs, manufactures and sells
signaling protocol conversion solutions to the telecommunications industry.

The Company's shares are quoted on the OTC Bulletin Board under the symbol
FSCX.OB.

FASTCOMM'S PRODUCTS

FastComm's suite of products include:

SIGNALING GATEWAY PRODUCT FAMILY
The FastComm line of signaling gateways bridges the gap between incompatible
communications networks, enabling seamless communication between in-band to
in-band, in-band and out-of-band networks and out-of-band to out-of-band SS7,
ISDN, and xGCP networks. There are 5 products in the signaling gateway product
line:

- SIGNALPATH(TM) 230 (SP-230) is a 52 T1/E1 signaling gateway allowing
communication between in-band and out-of-band networks or between networks
supporting different out-of-band protocols. As a signaling gateway supporting
multiple national SS7 and in-band variants, the SP-230 could extend the
softswitch architecture to foreign markets immediately.
- SP-201 is a 4 T1/E1 variant of the SP-230.
- R2 ADAPTER is a new low cost signaling appliance designed to enable PABX and
IP/PABX vendors to penetrate international markets where the need for protocol
conversion is the greatest.
- TSC-100 is a 24 T1/E1 signaling gateway allowing communication between
different variants of in-band signaling.
- MUX-100 is an analog to digital converter. Protocol conversion is an available
option.

INTEGRATED ACCESS DEVICES (IAD'S) PRODUCT FAMILY
Integrated Access Devices aggregate multiple traffic types (i.e. voice/fax, IP,
video, etc.) onto a single access port or circuit. The FastComm IADs consist of
the following two products:

-METROLAN(TM) family of IADs is ideal for remote office/branch office
environments. Supports up to 3 analog voice/fax ports, Ethernet, and up to 3
physical ports with extensive IP/legacy support.
-GLOBALSTACK(TM) is a modular IAD that complements the MetroLAN(TM) for medium
to large and central site environments. Supports up to 60 compressed digital
voice/fax channels or 6 voice interfaces, Ethernet and a variety of serial data
interfaces (i.e. V.35, X.21, V.24, T1/FT1, E1/Nx64kbps, and/or 56/64kbps
CSU/DSUs).

ROUTER/FRAD PRODUCT FAMILY
This product family is geared toward providing data routing capability for IP
and legacy communications.

- QUICK II(TM) is an integrated router, protocol converter and terminal
server all in one easy to manage compact

                                       4
<PAGE>   5

chassis, for attaching Unisys Poll Select devices into IP networks.
-MONOFRAD(TM) is a data router supporting a Network and a single User port.
-RINGFRAD(TM) is a data router supporting a Token Ring, a Network port and
up to 4 User ports.
-WEBROUTER(TM) is a compact, low cost Internet/Intranet router supporting
Ethernet and a single Network port.
-ETHERFRAD(TM) is a family of integrated IP and legacy data routers supporting
Ethernet, a Network port and up to 5 User ports.

SIGNALPATH 230
The SignalPath 230 (SP 230) is an advanced signaling protocol converter designed
to solve signaling compatibility problems that exist between communications
networks. Different types of communications protocols, both in-band and
out-of-band, exist globally making communications between such networks
impossible. The SP 230 breaks down the communications barriers presented by
these different protocols and enables a seamless flow of signaling information
across any network. The SP 230 can interface with switches and gateways provided
by Cisco, Lucent, Nortel, Siemens, Ericsson, Alcatel and others. As a signaling
gateway supporting multiple national SS7 and in-band variants, the SP-230 could
extend the softswitch architecture to foreign markets immediately.

In May, 2001, FastComm announced the SignalPath Release 7 software which
significantly increases performance and system availability in its SignalPath
Signaling Gateway product line. Release 7 has more capacity and supports higher
calling volumes which in turn means more revenues for carriers who use the
Signaling Gateway product in their networks. This release lays the foundation
for future products aimed at supporting large capacity switch vendors who are
looking to replace entirely the circuit-switch technology used by incumbent
telecom providers with packet network technologies.

R2 ADAPTER
In June 2001, the Company introduced the R2 Adapter, a small low cost signaling
appliance designed for PABX and IP/PABX vendors, small carriers and specific
application providers (such as video conferencing) who want to quickly penetrate
international markets where signaling conversion is required. Using existing
FastComm technology, the R2 Adapter is equipped to handle multiple
country-specific R2 variants that are deployed throughout the world. The R2
Adapter architecture positions the product for future Internet Protocol (IP), R2
to ISDN signaling conversion and IP based PABX applications.

METROLAN
The MetroLAN router combines analog voice from switches, PBXs, key systems,
telephones, and the public telephone network with LAN/legacy data & multimedia
and transports it over switched or dedicated digital networks. MetroLAN
satisfies the needs of small office/branch offices that require optimum phone
line performance. With FastComm's routing software, three analog voice ports,
two data equipment serial interfaces and an Ethernet port, the MetroLAN is the
perfect solution for voice/fax/data and video applications. The MetroLAN is
compliant with FRF.11, supporting voice compression (with silence suppression)
which allows up to 3 compressed voice channels to be transported in less than
30Kbps. Bandwidth is dynamically allocated between voice/video/data so that LAN
traffic may continually adapt to fill the unused bandwidth.

GLOBALSTACK
The GlobalStack-EX voice/fax/data/video router combines digital and analog voice
from switches, PBXs, key systems, and remote telephones with LAN/legacy data and
transports it over switched or dedicated digital networks. With digital T1, E1,
ISDN BRI and PRI interfaces, frame relay interfaces for data equipment, an
Ethernet port, and FastComm's routing software, the GlobalStack-EX is the
perfect solution for integrating voice/fax/data and multimedia throughout the
enterprise network. The GlobalStack-EX satisfies large regional and central site
office and POP locations where a confluence of communication mediums converge.
The GlobalStack-EX is compliant with FRF.11, supporting voice compression (with
silence suppression) and allows up to 30 voice channels to be transported in
less than 300Kbps. Bandwidth is dynamically allocated between voice/video/data
so that LAN traffic may continually adapt to fill the unused bandwidth.

QUICK PRODUCT LINE
The Quick II targets Unisys A and C-series mainframe customers who have been
using legacy CP2000 equipment. Unisys sells and supports the Quick II to
customers who require cost-effective network solutions for communication between
legacy mainframe, peripheral and LAN applications. FastComm supports over 100
protocol variations which legacy equipment users depend on for seamless
operations.

                                       5
<PAGE>   6

NEW PRODUCT DEVELOPMENT

The Company invests heavily in research and development and expects such
investment to continue.

Recorded expenses for research and development have been as follows:

<TABLE>
<S>                         <C>                  <C>
          Fiscal year 2001   $5,684,000            51%  of revenue
          Fiscal year 2000   $2,966,000            46%  of revenue
          Fiscal year 1999   $2,388,000            52%  of revenue
</TABLE>

The Company's ability to anticipate changes in technology, industry standards
and communications service provider offerings, and its ability to develop and
introduce new and enhanced products on a timely basis that are successful in the
market will be a significant factor in the Company's competitive position and in
its prospects for growth. Management believes that the future success of the
Company depends on its ability to continue to enhance its products, improve
product performance and functionality and to develop new products that address
emerging markets. Management believes that significant expenditures for research
and development will continue to be required.

To bring a product to market quickly, any design may be done entirely
internally, externally, jointly with another firm, or from licensed technology.
Larger companies, with greater engineering resources and more internal
expertise, may be able to develop a larger portion of their products without
outside technology. Elimination of licensing fees or royalties could provide
them a cost advantage.

Research and development project schedules for high technology products are
inherently difficult to predict, and there can be no assurance that the Company
will achieve its expected initial shipment dates of products in development. The
timely availability of new and enhanced products is critical to the success of
the Company. Delays in availability of these new products, or lack of market
acceptance of such products, could adversely affect the Company.

BACKLOG

Because of its quarterly design and build cycle, the Company builds and fills to
the extent possible all of its customer orders within the fiscal quarter of
receipt. Backlog of undeliverable orders is usually not significant. Management
believes that the Company's backlog as of any given date is not necessarily
indicative of actual revenues for any succeeding period.

Management knows of no material effect from non-compliance with environmental
laws or regulations.

SEASONALITY AND INFLATION

The Company's operations have not proven to be seasonal, although quarterly
revenue and net income may vary. Although the Company cannot accurately
determine the amounts attributable thereto, the Company has been affected by
inflation through increased costs of employee compensation and other operating
expenses. The Company believes that inflation has not had a material effect on
the Company's results of operation or financial condition.

MARKETING AND SALES

DOMESTIC
The Company targets its signaling gateway products and its IAD product line to
business customers and designs its products for volume sales through third party
resellers such as network product and service dealers, systems integrators,
telephone carriers and original equipment manufacturers. The Company has
existing relationships and contracts with several large companies such as
Nortel, Siemens, ECI. These resellers form a distribution channel for the
Company and, in some instances, provide installation and maintenance support
services.

During fiscal year 2001, sales to Nortel, Lucent and Ceicer accounted for 14%,
11% and 10% of total sales. During fiscal year 2000, sales to Amadeus, Pacific
Access Technology, and Anicom accounted for 18%, 15% and 12% of total sales.
During fiscal year 1999, sales to Alcatel Data Networks accounted for 28% of
total sales.

There were no Government contracts during the fiscal year that were subject to
renegotiation of profits or termination.

                                       6
<PAGE>   7

INTERNATIONAL
In the international marketplace, independent distributors represent the Company
in more than 35 countries. These firms are most often locally owned and managed,
which gives them an important presence in their markets. Terms of international
distribution agreements are similar to domestic agreements and grant to the
distributor similar stock adjustment/rotation and stock update rights. In most
instances, payment terms are cash in advance or confirmed documentary letter of
credit. In most cases, a distributor obtains non-exclusive rights to all
FastComm products for a specific geographic area. In fiscal years 2001, 2000 and
1999, the Company had export sales to foreign customers totaling $2,213,000,
$616,000 and $1,800,000, respectively. The majority of the sales were made in
Latin America and Europe.

The Company's protocol library includes signaling variants for over 80
countries. Accordingly, the Company places significant emphasis on international
selling opportunities. The Company employs an international sales force and has
executed reseller contracts with distributors throughout the world. The Company
is in discussions, of various stages, with other significant international
customers as well as domestic customers who will purchase FastComm products for
export. Since contracts have not yet been executed, no assurance can be made as
to the outcome of these discussions.

The Company's export sales may be subject to restrictions on foreign operations,
including restrictions imposed by foreign governments on imports as well as U.S.
Government originated restrictions, and are subject to risks associated with
fluctuations in foreign exchange rates. Although substantially all foreign
contracts are denominated, and revenues are paid, in United States dollars, to
the extent the Company receives payments in foreign currencies, it may incur
gains or losses because of exchange fluctuations between currencies. Moreover,
fluctuations in currency exchange rates may cause the Company's established
prices to be relatively more or less expensive in terms of local currencies.

CUSTOMER SUPPORT AND SERVICE

The Company maintains a technical support staff. Their work primarily supports
resellers, but end users are periodically given technical information and
assistance by telephone. For new products or features, including beta tests,
Company personnel will visit end user sites to participate in installation and
training.

PROMOTION

The Company places advertisements in trade publications that stress the unique
product benefits. Most publications in which the Company advertises have
international circulation, aiding the Company's selling efforts outside the U.S.

The Company participates in industry trade shows in order to meet prospective
customers, generate sales leads, communicate with the press, and to do market
research. The Company exhibits under its own name and also takes opportunities
to exhibit with its dealers and distributors who show FastComm products.

COMPETITION

The communications industry is highly competitive. Rapid technological change,
evolving standards and regulatory developments characterize the market for the
Company's products. Many of the Company's competitors and potential competitors
have greater financial, technological, manufacturing, marketing and personnel
resources than the Company. The Company's success depends to a large extent on
the insight, experience, and energy of its people, and therefore on its ability
to attract and retain experienced professionals.

The primary competition for each of the Company's major products is as follows:

SIGNALING GATEWAY PRODUCT FAMILY: The Company believes that there is a distinct
market for signaling gateways and that the SignalPath product family is well
positioned to take advantage of this trend. Competitors include TEKELEC,
Acculabs, Natural Microsystems, Performance Technologies and Telesoft Design
Ltd. Although, Sun Microsystems and Hewlett Packard have SS7 interfaces, they
focus on their server market without much emphasis on the multitude of
international signaling variants.

                                       7
<PAGE>   8

The complexity and lack of interworking standards represent high barriers to
entry. Accordingly, very few companies concentrate on this market. Those
companies that have demonstrated development of signaling products have
typically become acquisition targets of larger telecommunications companies.

INTEGRATED ACCESS DEVICES (IAD'S) PRODUCT FAMILY: Competition is extensive in
this marketplace. The major competitor is Cisco Systems' 2520-2523, 3800 and
other product lines.

ROUTER/FRAD PRODUCT FAMILY: The users of the Quick II product are those with
older Unisys mainframe computers that were designed to communicate using the
Poll/Select protocol on leased lines. Progress in computers and communications
technologies will force these networks to a more modern transmission format,
typically frame relay or Internet Protocol (IP). FastComm supports both
migration strategies with the Quick II, which replaces the CP 2000. The Quick II
is sold and supported by Unisys personnel as well as certain other FastComm
resellers. The major competitor to this product family is Cisco Systems.

LICENSES, PATENTS, AND TRADEMARKS

The communications industry traditionally relies more on trade secrets and rapid
obsolescence than patents. None of the Company's current products is protected
by patent.

On November 12, 1998, the Company entered into a 20-year licensing agreement
with Telogy Networks, Inc. to deliver their Golden Gateway Voice Over Packet
software and documentation service. The total committed cost was $281,000.
Payments are spread over a 24-month period. Deliverables include DSP unit
licenses and developer's kit and MCU unit licenses and developer's kit.

On November 24, 1998, the Company obtained a worldwide non-exclusive royalty
bearing license from Alcatel Data Networks, Inc. ("Alcatel") to use and further
develop Alcatel owned technology and intellectural property. The terms and
conditions of this agreement call for a one-time fee of $50,000 payable in four
equal installments plus royalty payments based on unit sales. The initial term
of this agreement is twenty years and is renewable subject to negotiation of
terms and conditions agreeable to both parties 30 days prior to its expiration.

Effective with the acquisition of Cronus, the Company assumed a perpetual
software license agreement that was originally into between Cronus and Trillium
Digital Systems, Inc. in July 1996. The terms and conditions of this agreement
allow the Company to utilize Trillium source code and documentation for further
development and subsequent resale to end-users. The Company is required to pay
annual maintenance fees of $39,324.

The Company licenses outside technology for its product development. The cost to
license software from commercial vendors is less than the loaded cost of
internal developments. Licensing also speeds product delivery. All of the
software licenses currently owned by the Company are perpetual. The Company
expects to license additional software, particularly in areas that are highly
standardized and have multiple sources to minimize costs.

Software related to the ISDN, X.25, voice compression and SNA interfaces is
licensed to the Company and has been integrated into its IAD / router product
line.

MANUFACTURING

Over the past several years, the Company has outsourced the manufacturing of its
circuit board assemblies to third party manufacturers. The Company believes that
the outsourcing of manufacturing preserves capital for other business purposes.
The Company's in house manufacturing process is limited to that of planning,
purchasing, material management, final assembly and testing. The Company will
continue this outsourcing activity for the foreseeable future.

Most of the components used in the Company's manufacturing process are available
from multiple sources. Single-source items are all from large vendors with
stable histories of supplying material as needed. FastComm and its third party
manufacturers have established strong relationships with key vendors to reduce
the risk of significant shortages or delays relating to availability of
materials. Shortages or delays in the supply of components could adversely
affect the Company's ability to meet scheduled product shipments in any
particular fiscal quarter, which could materially affect the Company's near term
operating results. Management believes the loss of any supplier would not be
materially detrimental to the Company's business in the long term.

                                       8
<PAGE>   9

EMPLOYEES

At July 5, 2001, the Company had 63 full-time employees. None of the Company's
employees is covered by a collective bargaining agreement. The Company believes
that its employee relations are satisfactory.

FUTURE PROSPECTS

RECENT FUNDING
In May 2001, the Company raised $3,000,000 through the sale of a 10% senior
secured convertible debenture ("Debenture") to Wesley Clover Corporation. All or
any portion of this Debenture may be converted into shares of common stock of
the Company by dividing the aggregate principle amount converted together with
all accrued but unpaid interest to the date of conversion by $0.446. The entire
debenture plus accrued interest is due and payable in a single installment on
June 8, 2006, unless sooner accelerated or converted into shares of common stock
of the Company. In connection with this investment, the Company also issued
warrants entitling Wesley Clover to purchase 3,363,229 shares of common stock of
the Company for $0.5575 per share. The warrants expire on June 8, 2006 and may
be called for redemption, by the Company, at such time as the bid price of the
Company's shares of common stock remains above $1.12 for 30 consecutive trading
days.

When and if exercised, the unexercised warrants associated with this offering
and other prior offerings and agreements would generate a maximum of $13,000,000
in additional cash for the Company. The Company can give no assurance as to
whether any warrants will be exercised, nor to the amount of cash that will be
generated, if any of these securities are exercised. (See Item 7. Liquidity and
Capital Resources)

SIGNALING OPPORTUNITIES
The Company is using the proceeds from this offering to develop new products and
to add new features to its existing product line. In May 2001, FastComm
announced the SignalPath Release 7 software which significantly increases
performance and system availability in its SignalPath Signaling Gateway product
line. Release 7 software has more capacity and supports higher calling volumes
which in turn means more revenues for carriers who use the Signaling Gateway
product in their networks. This release lays the foundation for future products
aimed at supporting large capacity switch vendors who are looking to replace
entirely the circuit-switch technology used by incumbent telecom providers with
packet networks.

The competitive environment that exists in the telecommunications marketplace
today dictates that the telecommunications carriers and Internet Service
Providers must seek additional revenue sources. Voice over internet protocol
(VoIP) offers unparalleled scalability, flexibility and economy. For this
reason, telecommunications carriers are reselling carrier grade IP telephony
services purchased from business to business outsource providers. A problem
exists in that the VoIP vendors are often limited in terms of supporting
traditional signaling protocols. The Company's SignalPath 230 Signaling Gateway
resolves this issue by providing a new level of interoperability with global
networks that employ protocols not directly supported by the VoIP network.
Worldwide, VoIP networks carried less than 1% of the number of calls made during
calendar year 2000, however it has been estimated that 40% of large corporations
have some sort of VoIP testing underway. Based on this market data, the Company
believes that VoIP will continue to offer revenue opportunities in the future.

PABX OPPORTUNITIES
In June 2001, the Company introduced the R2 Adapter, a small low cost signaling
appliance designed to enable PABX vendors to penetrate international markets
where signaling conversion is required. Next generation IP based PABX's are
software driven and far more flexible and cheaper to administer than traditional
PABX's. According to an independent research report, the market for the IP based
PABX's is significant and is expected to grow from $200 million today to
$4 billion over the next four years. Currently, some PABX vendors, due to
signaling incompatibilities, cannot sell IP based PABX's in parts of the world
that employ an R2 signaling variant. The R2 Adapter resolves this
incompatibility issue and opens large marketplaces that deploy R2, such as Latin
America, the Middle East, Africa and parts of Southeast Asia, to these vendors.
The IP/PABX vendors will generally sell one R2 Adapter for every IP based PABX
sold. There is a very limited number of suppliers with competing products in the
marketplace and accordingly, the Company anticipates significant future revenue
from this product.

RESTRUCTURING
The Company commenced a broad restructuring aimed at achieving profitability and
positive cash flow in its fiscal year 2002 by reducing costs and focusing on
market opportunities which offer the greatest revenue potential.

                                       9
<PAGE>   10

The Company discontinued its ChanlComm product line that was designed by KG Data
and closed its Connecticut facility. Until recently, the Company had been
actively marketing the technology associated with this division. The Company has
reduced its headcount from 103 to 63 fulltime employees and consolidated its two
Virginia facilities into one. As a result of these and other cost saving
activities, operating expenses have declined by approximately $1 million per
quarter effective in the first quarter of fiscal year 2002. One time charges for
these restructuring activities are reflected in the Company's operating results
for its fourth fiscal quarter for the year ended April 30, 2001.

The Company anticipates that it will require additional funding to meet future
working capital needs and research and development expenses. It is anticipated
that such funding will be generated by way of additional placements of
convertible debt or equity, through investments made by strategic partners and
through the exercise of in the money common stock warrants and options. The
Company can give no assurance as to whether it will be able to conclude such
financing arrangements, or that, if concluded, they will be on terms favorable
to the Company.

There can be no assurance that the required increased sales and improved
operating efficiencies necessary to return to profitability will materialize.

As part of a program to retain its employees, the Company adopted a program to
re-price the options of its current employees. The Company also re-priced the
options issued to its board of directors and to its chairman of the board. Under
the program, the exercise price of current stock options was changed to $0.51
per share. Although each employee could elect not to participate in this
program, the exercise price of approximately 2.5 million options was changed to
the lower price. Under applicable accounting rules, the Company will have to
account for future variations in the price of its common stock above $0.51 per
share as compensation expense until the repriced options are either exercised,
cancelled or expire. This calculation will be made each quarter based upon the
performance of the Company's common stock in that quarter. Accordingly,
operating results and earnings per share will be subjected to potentially
significant fluctuations based upon changes in the market price of the Company's
common stock. For the year ended April 30, 2001, operating results and earnings
per share were not impacted by this repricing because the price of the common
stock at April 30, 2001 was below $0.51 per share.


ITEM 2.    DESCRIPTION OF PROPERTIES

The Company's executive, administrative and marketing operations are located in
a leased 17,000 square foot facility in Dulles, Virginia. Aggregate base rent
and common charges for this facility approximated $293,000 for the fiscal year
ended April 30, 2001. This lease expires April 30, 2003. The Company's research
and development, technical support and manufacturing operations are located in a
leased 17,250 square foot facility located in Chantilly Virginia. Aggregate base
rent and common charges for this facility approximated $183,000 on an annual
basis. This lease, which was assumed as part of the Company's acquisition of
Cronus, expires on September 30, 2002. In June 2001, the Company vacated these
premises and consolidated all its operations at the Dulles facility.

As part of the KG Data in acquisition in April 1999, the Company assumed a three
year lease for a 3,700 square foot facility in Norwalk, Connecticut.
Expenditures under this lease agreement approximated $49,000 for the fiscal year
ended April 30, 2001. This lease expired on June 30, 2001. In fiscal 2001, the
Company discontinued the ChanlComm product line that was designed by KG Data and
accordingly did not renew this lease.

Management believes that its leased facilities adequately serve the Company's
present needs.


ITEM 3.     LEGAL PROCEEDINGS


A supplier of parts for the Company's integrated access device product line has
filed an action against the Company. The Plaintiff seeks $96,580.56 for goods
and sold and delivered, $261,113.87 and $19,548.56 for goods allegedly
manufactured but not yet delivered and $380,015 for parts allegedly ordered by
Plaintiff to fulfill anticipated orders. The Company filed its answer to the
complaint on June 15, 2001 and intends to vigorously defend this case.

On January 29, 2001, two individuals holding subordinated senior notes totaling
$1,000,000 commenced an action in the Circuit Court, Cook County, Illinois
against the Company, Cronus, certain former principal shareholders of

                                       10
<PAGE>   11

Cronus and a liquidating trust established by Cronus and its trustees seeking
repayment of the notes, together with accrued interest. FastComm has filed an
answer, motion to dismiss and counterclaim, which are pending. In connection
with this lawsuit, two co-defendants have filed cross-claims for indemnification
against the Company. The Company has denied liability for indemnification in the
circumstances of the lawsuit.

The Company was recently sued in Federal District Court N.D. Illinois by Richard
L. Abrahams, as Trustee of the R.L.A. 1993 Trust (the "Trust"). The action is
for an alleged breach of contract entered into by the Company and the Trust in
March, 2000 in connection with the Cronus acquisition. The trust seeks a
declaratory judgment stating that the Company must issue to it, approximately
628,000 shares of common stock, which it contends, are due under the agreement,
together with unspecified damages and costs. The Company has yet to answer the
complaint but intends to vigorously deny all allegations.

No other material legal proceeding to which the Company is party or to which the
Company is subject is pending and no such proceeding is known by the Company to
be contemplated.

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

None.



                                       11
<PAGE>   12

                                    PART II.


ITEM 5.   MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

Prior to June 9, 1998, FastComm shares of common stock were traded publicly on
the NASDAQ National Market under the symbol FSCX. On June 9, 1998, the Company's
shares of common stock were delisted from the National Market System. Effective
June 16, 1998, the Company's shares of common stock have been quoted on the OTC
Bulletin Board under the same symbol.

The following table sets forth the range of high and low closing bid prices or
sales prices, as applicable, of the Company's shares of common stock for each
fiscal quarter during the two most recent fiscal years, as furnished by NASDAQ.
The bid prices represent prices between dealers, do not include retail markups,
markdowns or commissions and do not necessarily represent actual transactions.


<TABLE>
<CAPTION>
                                                                      High         Low
                                                                      ----         ---

Fiscal Year Ended April 30, 2001:

<S>                                                                 <C>         <C>
            First Quarter.........................................   $3.56       $1.94
            Second Quarter........................................    2.91        1.34
            Third Quarter.........................................    2.19         .66
            Fourth Quarter .......................................     .84         .29
</TABLE>



<TABLE>
<CAPTION>
                                                                      High        Low
                                                                      ----        ---
Fiscal Year Ended April 30, 2000:

<S>                                                                  <C>         <C>
            First Quarter.........................................   $1.34       $.80
            Second Quarter .......................................    1.03        .69
            Third Quarter.........................................    6.06        .77
            Fourth Quarter .......................................    5.31       2.69
</TABLE>



As of July 20, 2001, there were 414 registered holders of record of the common
stock and the closing sales price on such date for the Common Stock as reported
by NASDAQ was $0.22 per share.

DIVIDEND POLICY

The Company has not paid dividends on its common stock. The Company anticipates
that it will retain all earnings to finance the operation and growth of its
business and does not anticipate paying cash dividends on the common stock in
the foreseeable future.



                                       12
<PAGE>   13




ITEM 6.     SELECTED FINANCIAL DATA

The following sets forth certain selected financial data for the five fiscal
years in the period ended April 30, 2001. The statement of operations data for
the fiscal years ended April 30, 2001, 2000 and 1999 and the balance sheet data
at April 30, 2001 and 2000 are derived from and are qualified by reference to
the financial statements of the Company audited by BDO Seidman, LLP, the
Company's independent certified public accountants, whose opinion contains an
explanatory paragraph related to substantial doubt about the Company's ability
to continue as a going concern and is included elsewhere, herein. The statement
of operations data for the fiscal years ended April 30, 1998 and 1997 and the
balance sheet data at April 30, 1999, 1998 and 1997 are derived from financial
statements of the Company also audited by BDO Seidman, LLP, but not included in
this Annual Report. The financial data should be read in conjunction with the
financial statements and related notes and other financial information and
Management's Discussion and Analysis of Financial Condition and Results of
Operations included elsewhere in this Annual Report.


<TABLE>
<CAPTION>
                                                                       FISCAL YEAR ENDED APRIL 30,
                                              ---------------------------------------------------------------------------
                                                 2001                 2000          1999         1998           1997
                                                 ----                 ----          ----         ----           ----
STATEMENT OF OPERATIONS DATA:                                               ($000'S EXCEPT PER SHARE DATE)

<S>                                            <C>                   <C>           <C>           <C>          <C>
   Total revenues                                $10,918               $6,415        $4,653        $8,907       $11,163

   Operating costs and expenses
      Costs of goods sold                          4,798                4,074         2,679         5,441         4,737
      Other operating expenses                    18,841                9,043         7,610        11,684         7,202
                                              ---------------------------------------------------------------------------
   Total operating costs and expenses             23,639               13,117        10,289        17,125        11,939
   Operating loss                                (12,721)              (6,702)       (5,636)       (8,218)         (776)

   Other income (expense), net                       (94)                (115)         (104)         (871)          181
   Reorganizational items, net                         -                    -          (643)            -             -

   Loss before extraordinary item                (12,815)              (6,817)       (6,383)       (9,089)         (595)

   Extraordinary gain                                  -                    -           833             -             -
                                              ---------------------------------------------------------------------------
   Net loss                                     ($12,815)             ($6,817)      ($5,550)      ($9,089)        ($595)
                                              ===========================================================================

   Basic and diluted loss before
      extraordinary item                          ($0.48)              ($0.35)       ($0.49)       ($0.87)       ($0.06)

   Extraordinary item                                  -                    -          0.06             -             -

   Basic and diluted loss per share               ($0.48)              ($0.35)       ($0.43)       ($0.87)       ($0.06)

   Weighted average number of shares
   outstanding during each period                 26,569               19,277        12,917        10,391         9,961

BALANCE SHEET DATA:

   Total assets                                  $14,222              $21,199        $5,581        $9,226       $12,622
   Total long term liabilities                      $733                 $771        $2,690        $1,205        $3,000
   Shareholders' equity                           $6,412              $13,770        $1,036        $3,246        $7,759
</TABLE>



                                       13
<PAGE>   14



ITEM 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATIONS


THE FOLLOWING DISCUSSION SHOULD BE READ IN CONJUNCTION WITH THE CONSOLIDATED
FINANCIAL STATEMENTS AND NOTES THERETO INCLUDED IN THIS ANNUAL REPORT. IN
ADDITION, THE COMPANY DESIRES TO TAKE ADVANTAGE OF THE "SAFE HARBOR" PROVISIONS
OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. SPECIFICALLY, THE
COMPANY WISHES TO ALERT READERS THAT THE FACTORS SET FORTH IN ITEM 5, "MARKET
FOR REGISTRANTS COMMON STOCK AND RELATED STOCKHOLDER MATTERS - ADDITIONAL
FACTORS THAT MAY AFFECT OUR BUSINESS AND FUTURE RESULTS", AS WELL AS OTHER
FACTORS, IN THE PAST HAVE AFFECTED AND IN THE FUTURE COULD AFFECT THE COMPANY'S
ACTUAL RESULTS, AND COULD CAUSE THE COMPANY'S RESULTS FOR FUTURE QUARTERS TO
DIFFER MATERIALLY FROM THOSE EXPRESSED IN ANY FORWARD LOOKING STATEMENTS MADE BY
OR ON BEHALF OF THE COMPANY.

FUTURE PROSPECTS

RECENT FUNDING
In May 2001, the Company raised an additional $3,000,000 through the sale of a
10% senior secured convertible debenture to Wesley Clover Corporation. All or
any portion of this Debenture may be converted into shares of common stock of
the Company by dividing the aggregate principle amount converted together with
all accrued but unpaid interest to the date of conversion by $0.446. The entire
debenture plus accrued interest is due and payable in a single installment on
June 8, 2006, unless sooner accelerated or converted into shares of common stock
of the Company. In connection with this investment, the Company also issued
warrants entitling Wesley Clover to purchase 3,363,229 shares of common stock of
the Company for $0.5575 per share. The warrants expire on June 8, 2006 and may
be called for redemption, by the Company, at such time as the bid price of the
Company's shares of common stock remains above $1.12 for 30 consecutive trading
days.

When and if exercised, the unexercised warrants associated with this offering
and other prior offerings and agreements would generate a maximum of $13,000,000
in additional cash for the Company. The Company can give no assurance as to
whether any warrants will be exercised, nor to the amount of cash that will be
generated, if any of these securities are exercised. (See Item 7. Liquidity and
Capital Resources)

SIGNALING OPPORTUNITIES
The Company is using the proceeds from this recent offering to develop new
products and to add new features to its existing product line. In May, 2001,
FastComm announced the SignalPath Release 7 software which significantly
increases performance and system availability in its SignalPath Signaling
Gateway product line. Release 7 software has more capacity and supports higher
calling volumes which in turn means more revenues for carriers who use the
Signaling Gateway product in their networks. This release lays the foundation
for future products aimed at supporting large capacity switch vendors who are
looking to replace entirely the circuit-switch technology used by incumbent
telecom providers with packet networks.

The competitive environment that exists in the telecommunications marketplace
today dictates that the telecommunications carriers and Internet Service
Providers must seek additional revenue sources. Voice over I Internet protocol
(VoIP) offers unparalleled scalability, flexibility and economy. For this
reason, telecommunications carriers are reselling carrier grade IP telephony
services purchased from business to business outsource providers. A problem
exists in that the VoIP vendors are often limited in terms of supporting
traditional signaling protocols. The Company's SignalPath 230 Signaling Gateway
resolves this issue by providing a new level of interoperability with global
networks that employ protocols not directly supported by the VoIP network.
Worldwide, VoIP networks carried less than 1% of the number of calls made during
calendar year 2000, however it has been estimated that 40% of large corporations
have some sort of VoIP testing underway. Based on this market data, the Company
believes that VoIP will continue to offer revenue opportunities in the future.

PABX OPPORTUNITIES
In June 2001, the Company introduced the R2 Adapter, a small low cost signaling
appliance designed to enable PABX vendors to penetrate international markets
where signaling conversion is required. Next generation IP based PABX's are
software driven and far more flexible and cheaper to administer than traditional
PABX's. According to an independent research report, the market for the IP based
PABX's is significant and is expected to grow from $200 million today to
$4 billion over the next four years. Currently, some PABX vendors, due to
signaling


                                       14
<PAGE>   15

incompatibilities, cannot sell IP based PABX's in parts of the world that employ
an R2 signaling variant. The R2 Adapter resolves this incompatibility issue and
opens large marketplaces that deploy R2, such as Latin America, the Middle East,
Africa and parts of Southeast Asia, to these vendors. The IP/PABX vendors will
generally sell one R2 Adapter for every IP based PABX sold. There is a very
limited number of suppliers with competing products in the marketplace and
accordingly, the Company anticipates significant future revenue from this
product.

RESTRUCTURING
The Company commenced a broad restructuring aimed at achieving profitability and
positive cash flow in its fiscal year 2002 by reducing costs and focusing on
market opportunities which offer the greatest revenue potential.

The Company discontinued the ChanlComm product line that was designed by KG Data
and closed its Connecticut facility. Until recently, the Company had been
actively marketing the technology associated with this division. The Company has
reduced its headcount from 103 to 63 fulltime employees and consolidated its two
Virginia facilities into one. As a result of these and other cost saving
activities, quarterly operating expenses have declined by approximately
$1 million effective in the first quarter of fiscal year 2002. One time charges
associated with these restructuring activities totaling $1,588,000 are reflected
in the Company's operating results for its fourth fiscal quarter for the year
ended April 30, 2001.

During the fiscal year ended April 30, 2001, the Company recorded $1,364,000 in
costs associated with the discontinuance of its ChanlComm product line. These
costs were as follows:

<TABLE>
<S>                                     <C>
        Inventory writeoff                  $554,000
        Goodwill writeoff                    347,000
        Workforce reduction                  337,000
        Other                                126,000
                                           ---------
               Total                      $1,364,000
</TABLE>

Also during the current fiscal year, the Company recorded $224,000 in costs
associated with the consolidation of excess operating facilities. Such costs are
primarily associated with a reserve for non-cancelable lease costs. Remaining
cash expenditures relating to workforce reductions and termination of agreements
will be substantially paid in the first and second quarters of fiscal 2002.

As part of a program to retain its employees, the Company adopted a program to
re-price the options of its current employees. The Company also re-priced the
options issued to its board of directors and to its chairman of the board. Under
the program, the exercise price of current stock options was changed to $0.51
per share. Although each employee could elect not to participate in this
program, the exercise price of approximately 2.5 million options was changed to
the lower price. Under applicable accounting rules, the Company will have to
account for future variations in the price of its common stock above $0.51 per
share as compensation expense until the repriced options are either exercised,
cancelled or expire. This calculation will be made each quarter based upon the
performance of the Company's common stock in that quarter. Accordingly,
operating results and earnings per share will be subjected to potentially
significant fluctuations based upon changes in the market price of the Company's
common stock. For the year ended April 30, 2001, operating results and earnings
per share were not impacted by this repricing because the price of the common
stock at April 30, 2001 was below $0.51 per share.

The Company anticipates that it will require additional funding to meet future
working capital needs and research and development expenses. It is anticipated
that such funding will be generated by way of additional placements of
convertible debt or equity, through investments made by strategic partners and
through the exercise of in the money common stock warrants and options. The
Company can give no assurance as to whether it will be able to conclude such
financing arrangements, or that, if concluded, they will be on terms favorable
to the Company.

There can be no assurance that the required increased sales and improved
operating efficiencies necessary to return to profitability will materialize.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As explained in the succeeding
paragraphs, the Company has sustained recurring operating losses and cash flow
deficits in fiscal years 2001, 2000 and 1999. In addition, the Company must
obtain funds from outside sources in fiscal year 2002 to successfully implement
its business plan. Presently, the Company has no firm commitments from outside
sources to provide these funds. These factors raise substantial doubt about the
Company's ability to

                                       15
<PAGE>   16

continue as a going concern. The financial statements do not contain any
adjustments that might result from the outcome of these uncertainties.

BUSINESS ACQUISITION
On March 31, 2000, the Company acquired substantially all of the assets and
assumed certain liabilities of Cronus Technology, Inc. ("Cronus") for
approximately $9,600,000, plus the assumption of liabilities of approximately
$6,700,000 subject to adjustment as set forth in the agreement. The acquisition
was accounted for as a purchase and, accordingly, the acquired assets and
liabilities were recorded at their estimated fair market values at the date of
acquisition. The Company recorded goodwill of approximately $12,000,000 related
to this transaction. The goodwill is being amortized on a straight line basis
over four years.

The terms and conditions of the purchase and debt assumption agreements related
to this transaction obligated the Company to issue additional common shares if
the fair market value of the Company's common stock did not reach $7.30 prior to
the one year anniversary date of these agreements. This target was not met.
Accordingly, the Company issued an additional 2,035,730 shares and increased the
goodwill associated with this transaction by $763,399.

The results of operations for the current fiscal year includes revenue and
expenses generated by Cronus. The results of operations for the fiscal year
ended April 30, 2000 include one months worth of such items. To facilitate
comparability, the analysis of revenue and expense items includes information
presented on a proforma basis assuming the inclusion of Cronus revenues and
expenses as if the acquisition occurred on May 1, 1999.


RESULTS OF OPERATIONS

The following table sets forth, for the fiscal years indicated, the percentage
of revenues represented by certain items in the Company's consolidated
statements of income.



<TABLE>
<CAPTION>
                                                         FISCAL YEAR ENDED APRIL 30,
 STATEMENT OF OPERATIONS DATA:                         2001        2000         1999
                                                       ----        ----         ----

<S>                                                  <C>          <C>          <C>
   Total revenues                                       100%         100%         100%

   Operating costs and expenses
      Costs of goods sold                                44%          64%          58%
      Selling, general and administrative                70%          78%         102%
      Research and development                           52%          46%          51%
      Restructuring costs                                15%            -            -
      Depreciation and amortization                      36%          16%          10%
                                                   -----------------------------------
                                                        217%         204%         221%
                                                   -----------------------------------

   Operating loss                                     (117%)       (104%)       (121%)

   Other income (expense), net                          (1%)         (2%)         (2%)

   Reorganizational items                                  -            -        (14%)
                                                   -----------------------------------

   Loss before extraordinary gain                     (118%)       (106%)       (137%)

   Extraordinary gain                                      -            -          18%
                                                   -----------------------------------

   Net loss                                           (118%)       (106%)       (119%)
                                                   ===================================
</TABLE>





FISCAL 2001 COMPARED TO FISCAL 2000
Total revenues increased from $6,415,000 to $10,918,000 or by 70% during fiscal
2001 as compared to fiscal 2000. On a proforma basis, assuming the inclusion of
Cronus sales, revenues totaled $12,932,000 for the fiscal year ended April 30,
2000. The $2,014,000 proforma decrease is primarily attributable to a decline in
unit sales of voice and

                                       16
<PAGE>   17

data access products ($1,792,000). The Company did not make any significant
price adjustments during the current fiscal year.

During the fiscal year ended April 30, 2001, three customers accounted for 14%,
11% and 10% of total sales.

A significant portion of the Company's sales are derived from products shipped
against firm purchase orders received in each fiscal quarter and from products
shipped against firm purchase orders released in that quarter. Unforeseen delays
in product deliveries or the closing of sales, introduction of new products by
the Company or its competitors, fluctuations in customer capital expenditures or
other conditions affecting the networking industry or the economy during any
fiscal quarter could cause quarterly revenue and net earnings to vary greatly.

Gross margins, as a percentage of total revenues, increased from 36% to 56%
during fiscal 2001 as compared to fiscal 2000. On a proforma basis, gross
margins for both periods were 56%. During fiscal 2001, the Company wrote off,
against its existing reserves $774,000 in inventory made obsolete by new product
developments and the discontinuation of the ChanlComm product line. Accordingly,
after this inventory writedown, the Company increased its reserve for inventory
obsolescence by $774,000. The increase in the reserve adversely affected the
fiscal year 2001 gross margin by approximately 7%. The Company's gross margin
was positively impacted by sales of its signaling product lines which produce
gross margins significantly greater than products offered by the Company in the
previous fiscal year. As of April 30, 2001, the Company has recorded a $600,000
reserve for inventory obsolescence, which management believes is adequate.

The Company expects gross margins may be adversely affected by increases in
material or labor costs, heightened price competition, increasing levels of
services, higher inventory balances, inventory financing, introduction of new
products for new high growth markets and changes in channels of distribution or
in the mix of products sold. Management also believes that gross margins may be
additionally impacted due to constraints relating to certain component shortages
that may exist in the supply chain.

Selling, general and administrative expenses increased from $4,984,000 in fiscal
2000 to $7,662,000 in fiscal 2001. On a proforma basis, fiscal year 2000
selling, general and administrative expenses totaled $7,175,000. This 7%
increase is primarily attributable to a $1.3 million increase in bad debt
expense offset by reduced employee related costs associated with headcount
reductions and reduced advertising and marketing expenses.

Research and development expenditures consist primarily of hardware and software
engineering, personnel expenses, subcontracting costs and, to a lesser degree,
equipment and facilities. Research and development expenses increased from
$2,966,000 in fiscal 2000 to $5,684,000 in fiscal 2001. On a proforma basis
research and developmemt expenses for fiscal 2000 totaled $4,786,000. This 19%
proforma increase is primarily attributable to increased labor and material
costs associated with new product development and new product prototypes. The
markets for the Company's products are characterized by continuous technological
change. Management believes that significant expenditures for research and
development will continue to be required.

Depreciation and amortization expenses increased from $1,093,000 in fiscal 2000
to $3,907,000 in fiscal 2001. This increase is primarily attributable to the
full year effect of the amortization of goodwill associated with the Cronus
acquisition.

FISCAL 2000 COMPARED TO FISCAL 1999
Total revenues increased from $4,653,000 to $6,415,000 or by 38% during fiscal
2000 as compared to fiscal 1999. The $1,762,000 increase was primarily
attributable to $1,218,000 associated with the introduction of the GlobalStack
and MetroLan product lines and $856,000 in sales of the Cronus product line. The
Company acquired Cronus effective March 31, 2000 and accordingly included one
month of Cronus sales in fiscal 2000.

During the fiscal year ended April 30, 2000, three customers accounted for 18%,
15% and 12% of total sales.

Gross margins, as a percentage of total revenues, decreased from 42% to 36%
during fiscal 2000 as compared to fiscal 1999. During fiscal 2000, the Company
wrote off, against its existing reserve, inventory made obsolete by new product
developments, the acquisition of Cronus and a change in overall product focus.
Accordingly, after the significant inventory writedown, the Company also
increased its reserve for inventory obsolescence by $815,000. The increase in
the reserve reduced gross margin by approximately 13%. The Company's gross
margin was positively impacted by the introduction of the GlobalStack and
MetroLan product lines.

                                       17
<PAGE>   18

Selling, general and administrative expenses increased from $4,747,000 in fiscal
1999 to $4,984,000 in fiscal 2000. This 5% increase is primarily attributable to
expenses incurred by Cronus in April 2000 ($429,000) and increased marketing
costs ($246,000) offset by reduced employee related costs ($192,000) and reduced
equipment rental expense resulting from terminated and renegotiated leases
($210,000).

Research and development expenditures consist primarily of hardware and software
engineering, personnel expenses, subcontracting costs and, to a lesser degree,
equipment and facilities. Research and development expenses increased from
$2,388,000 in fiscal 1999 to $2,966,000 in fiscal 2000. This 24% increase is
primarily attributable to one months worth of expenses incurred by Cronus
($278,000) and increased labor and material costs associated with new product
development and new product prototypes associated with the GlobalStack, MetroLan
and ChanlComm product lines.

Depreciation and amortization expenses increased from $475,000 in fiscal 1999 to
$1,093,000 in fiscal 2000. This increase is primarily attributable to one months
amortization of goodwill associated with the Cronus acquisition ($323,000); the
full year effect of the amortization of goodwill associated with the acquisition
of KG Data and to a lesser degree, depreciation associated with Cronus fixed
assets and other recent capital expenditures.

LIQUIDITY AND CAPITAL RESOURCES

During fiscal year 2001, the Company used approximately $5,244,000 in cash to
fund its operating activities. The increase in the amount of cash used in
operations is primarily due to the $6,000,000 increase in the net loss that was
partially offset by non-cash expenses, primarily depreciation, amortization,
inventory write-offs, impairment of goodwill and adjustments to inventory and
receivable valuation accounts. Accounts receivable and other current assets
declined by $698,000 while accounts payable and other current assets increased
$1,535,000 providing additional liquidity.

Accounts receivable decreased $393,000 during fiscal year 2001. Globally,
telecommunications equipment vendors and resellers have experienced a
significant decline in the demand for their products over the past nine month
period. As a result of this slowdown in demand, the Company encountered
significant difficulties in collecting accounts receivable from certain
resellers of its products. At the end of the third quarter of fiscal 2001, the
Company evaluated the collectability of its accounts receivable based on
information available at the time. The Company increased its collection efforts
in the fourth quarter, however, such efforts proved unsuccessful. Accordingly,
the Company increased its allowance for doubtful accounts to $1.4 million at
April 30, 2001, which management believes is adequate.

Inventory levels increased $354,000 during fiscal year 2001. Inventory increased
due to a buildup of inventory in anticipation of demand that did not materialize
in the second half of fiscal 2001. The Company wrote off, against its existing
reserve, inventory $773,000 in product made obsolete by new product developments
and a change in overall product focus. The Company has a $600,000 reserve for
inventory obsolescence, which management believes is adequate.

At April 30, 2001, the Company had a cash balance of $69,000, a working capital
deficit of $2.4 million and a current ratio of 0.66 to 1. All of the Company's
assets are collateralized under the accounts receivable financing agreement with
Alliance Financial Capital, Inc. ( See Item 7. Cash Requirements)

FISCAL 2001 COMPARED TO FISCAL 2000
Cash used in operating activities increased from $4,568,000 in fiscal 2000 to
$5,244,000 in fiscal 2001. The $676,000 increase in cash used in operating
activities is primarily attributable to the 5,998,000 increase in the net loss
for the current fiscal year offset by a $5,158,000 net increase in other non
cash expenses, primarily depreciation and amortization accounts, asset valuation
accounts and by changes in working capital items in fiscal 2001 compared to
fiscal 2000. Such changes include a $1,249,000 decrease in cash used to fund
accounts receivable, a $2,570,000 increase in cash invested in inventory and a
$1,361,000 increase in current liability balances.

Cash used by investing activities totaled $190,000 in fiscal 2001 as compared
$345,000 in fiscal 2000. The Company purchased $235,000 in fixed assets during
the current fiscal year. Investing activities in the previous fiscal year were
partially offset by $182,000 assumed as part of the Cronus acquisition.

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<PAGE>   19

Cash provided by financing activities is primarily attributable to $3,845,000 in
net proceeds received from the private placement of prepaid warrants and
$1,188,000 in net proceeds received from the issuance of common stock offset by
repayments on the revolving line of credit. The Company also received $400,000
from the exercise of stock options and warrants during the current fiscal year.

FISCAL 2000 COMPARED TO FISCAL 1999
Cash used in operating activities increased from $2,329,000 in fiscal 1999 to
$4,568,000 in fiscal 2000. The $2,329,000 increase in cash used in operating
activities is primarily attributable to the $1,518,000 increase in the net loss
for the year and by changes in working capital items in fiscal 2000 compared to
fiscal 1999. Such changes included a $3,311,000 increase in cash used to fund
accounts receivable, a $1,617,000 reduction in cash invested in inventory and
increases in other non cash expenses, primarily depreciation and amortization
accounts, asset valuation accounts.

Cash used by investing activities totaled $345,000 in fiscal 2000 as compared
$62,000 in fiscal 1999. The Company purchased $527,000 in fixed assets during
the current fiscal. This was partially offset by $182,000 assumed as part of the
Cronus acquisition.

Cash provided by financing activities totaled $5,370,000 during fiscal 2000. The
Company issued $1,087,000 in common stock during the fiscal year. Of this
amount, $152,000 remains in escrow as restricted cash. The Company received
$4,392,000 from the exercise of common stock warrants and $313,000 from the
exercise of stock options during its fiscal year 2000.

CASH REQUIREMENTS
In fiscal 2002, the Company's cash commitments include minimum payments of
$441,000 under its operating lease arrangements. Management believes that
expenditures for research and development in fiscal 2002 will continue to be
significant. The Company anticipates additional capital spending for software,
computer and test equipment and furniture and fixtures in fiscal 2002. Where
possible, such capital requirements are expected to be met through lease
financing arrangements.

REVOLVING LINE OF CREDIT
In connection with the acquisition of Cronus, the Company assumed liabilities
under a revolving line of credit and term loan agreement with LaSalle National
Bank. Under the revolving line of credit the Company could borrow up to the
lesser of $3,000,000 or 80% of eligible accounts receivable and 35% of eligible
inventory, as defined in the agreement. The revolving line of credit bore
interest at the bank's prime rate of interest plus 1.0% and was scheduled to
mature on May 1, 2001. The term loan was payable in equal monthly principle
payments of $9,875, bears interest at the bank's prime rate of interest plus
1.0% and was schedule to mature on May 1, 2001. In April 2000, the Company
placed $250,000 in escrow to further collateralize the revolving line of credit
and term loan. In July 2000, the bank informed the Company that the revolving
line of credit and term loan would mature on September 30, 2000. On September
12, 2000, the bank agreed to a further extension until December 31, 2000.

On February 6, 2001, the Company entered into an accounts receivable financing
agreement with Alliance Financial Capital, Inc. that replaced the revolving line
of credit and term loan agreement with LaSalle National Bank. All debt
associated with the LaSalle agreement was satisfied. Under the new accounts
receivable financing agreement, the Company can borrow up to the lesser of
$3,000,000 or up to 85% of eligible accounts receivable, as defined in the
agreement. The accounts receivable financing agreement bears interest at the
prime rate plus 1.0% plus an additional 1.5% per invoice funded. The debt
associated with this financing arrangement is senior to all other debt of the
Company. The initial term of this agreement is for twelve months with a minimum
average daily account balance of $750,000.

In connection with the acquisition of Cronus, the Company assumed $1,000,000 in
debt to two individuals, which is subordinated in priority and payment to all
senior debt. This debt matured on December 10, 2000. The Company is currently in
default on the repayment of this debt and the individuals have commenced a
lawsuit against the Company. (See Part 2, Item 1. Legal Proceedings)

The Company anticipates that it may require additional funding to meet future
expansion and research and development expenses. It is anticipated that such
funding will be generated by way of additional placements of equity, through
research and development arrangements funded by third parties, by investments by
strategic partners and through the exercise of in the money common stock
warrants and options. The Company can give no assurance

                                       19
<PAGE>   20

as to whether it will be able to conclude such financing arrangements, or that,
if concluded, they will be on terms favorable to the Company.

PRIVATE PLACEMENTS
In July 2000, the Company raised $1,170,000 in a private placement of 616,000
unregistered common shares to a group of accredited investors. In connection
with this placement, the investors were granted warrants to purchase 308,000 of
common stock for $3.00 per share. These warrants have expired.

In September 2000, the Company sold 3,500 units at $1,000 per unit to a group of
accredited investors. Each unit consists of a prepaid common stock purchase
warrant ("Prepaid Warrant") and an incentive warrant ("Incentive Warrant") to
acquire additional shares of common stock in the Company. The Prepaid Warrant is
convertible at the option of the holder into common stock at a conversion price
equal to the lesser of $2.00 or the average of the five lowest closing bid
prices for the ten trading day period prior to conversion. The Prepaid Warrant
earns interest at a rate of 4% payable in common stock. The Incentive Warrants
allow the holder to purchase one half of one share at a $2.50 per share. The
Incentive Warrants have a five year term and are exercisable immediately. The
Company recorded the proceeds from the issuance of the Prepaid Warrants as paid
in capital. The interest earned on these warrants will be reflected as a
dividend. The Company paid a placement fee of $350,000 plus other associated
costs of $71,000 and issued to the placement agent warrants to purchase 438,000
shares of stock at an exercise price of $2.50 per share. The fee paid and the
fair value of the warrants issued were recorded as a reduction in paid in
capital. The placement agent for this transaction was The Zanett Securities
Corporation.

In February 2001, the Company sold an additional 850 units at $1,000 per unit to
the same investment group. The Prepaid Warrant is convertible at the option of
the holder into common stock at a conversion price equal to the lesser of $.85
or the average of the lowest five closing bid prices for the ten trading day
period prior to conversion. The Prepaid Warrant earns interest at a rate of 6%
payable in common stock. The Incentive Warrants allow the holder to purchase one
half of one share at a $1.0625 per share. The Incentive Warrants have a five
year term and are exercisable immediately. The Company paid a placement fee of
$85,000 plus other associated costs totaling $15,000 and issued the placement
agent warrants to purchase 212,500 shares of stock at price of $1.0625 per
share.

In April 2001, the Company raised $102,000 in a private placement of 329,000
unregistered common shares to a group of accredited investors. In connection
with this placement, the investors were granted warrants to purchase 164,500
shares at common stock for $0.41 per share. These warrants are exercisable for a
period of two years after the closing date.

In May 2001, the Company raised $3,000,000 through the sale of a 10% senior
secured convertible debenture to Wesley Clover Corporation. All or any portion
of this Debenture may be converted into shares of common stock of the Company by
dividing the aggregate principle amount converted together with all accrued but
unpaid interest to the date of conversion by $0.446. The entire debenture plus
accrued interest is due and payable in a single installment on June 8, 2006,
unless sooner accelerated or converted into shares of common stock. In
connection with this investment, the Company also issued warrants entitling
Wesley Clover to purchase 3,363,229 shares of common stock of the Company for
$0.5575 per share. The warrants expire on June 8, 2006 and may be called for
redemption, by the Company, at such time as the bid price of the Company's
shares of common stock remains above $1.12 for 30 (thirty) consecutive trading
days.

UNEXERCISED WARRANTS
When and if exercised, the unexercised warrants associated with these offerings
and other prior offerings and agreements would generate a maximum of $13,000,000
in additional cash for the Company. The Company can give no assurance as to
whether any warrants will be exercised, nor to the amount of cash that will be
generated, if any of these securities are exercised.

INFLATION
Management believes that inflation did not have a material effect on operations
during the fiscal year ended April 30, 2001.

CREDIT TERMS
The Company extends credit to its customers. Accordingly, the Company may have
significant risk in collecting accounts receivable from its customers. The
Company has credit policies and procedures that it uses to minimize exposure to
credit losses. The Company's collection personnel regularly contact customers
with receivable balances

                                       20
<PAGE>   21

outstanding to expedite collection. If these collection efforts are
unsuccessful, the Company may discontinue product shipments until the
outstanding balance is paid.

In many instances, the Company requires that international sales be paid in
advance by wire transfer or confirmed letter of credit. This practice ensures
against bad debts while improving cash flow.

Certain Resellers may request a stock adjustment/rotation twice annually and a
stock update at any time. "Stock adjustment/rotation" and "stock update" are
agreements whereby FastComm permits a reseller, at FastComm's sole discretion,
to return already purchased but unused and still current products to FastComm.
Stock adjustments/rotations and stock updates, which require the approval of an
officer of FastComm, are granted for specific purposes:

-   Stock adjustment/rotation allows an exchange for other FastComm products of
    equal value. At the sole discretion of FastComm, stock adjustments may be
    limited to 10% or 20% of the value of product ordered and accepted and paid
    for by the reseller during the prior six-month period.

-   Stock updates may be approved for either warranty revalidation and/or
    software revision level changes on products that are then returned to the
    dealer. At FastComm's sole discretion, returned products may be exchanged
    for the same types of equipment from inventory.

FastComm, at its sole discretion, may charge a reseller a "restocking charge" of
up to 20% to execute a stock adjustment or stock update. Stock
adjustment/rotation and stock update do not permit distributors to return
purchased merchandise for a refund.

The Company's practices concerning stock adjustment/rotation and stock updates
are believed to be consistent with those of the communications manufacturing
industry, based on management's experiences and its analysis of similar
companies. Accordingly, the Company believes that its policy of recognizing
revenue at time of shipment is in accordance with generally accepted accounting
principles.

Normally, payment in full is due within thirty days from date of shipment to the
reseller. The Company offers extended payment terms in certain situations. The
Company also offers prompt payment discounts. Although normal payment terms are
net 30 days from date of shipment, as a practical matter, the Company normally
receives payments on accounts receivable beyond thirty (30) days, even from its
most credit-worthy customers. Management does not believe that its credit and
collection history is substantially different from other companies in the
communications industry, based on management's experiences with similar
companies.

With the exception of the stock adjustment/rotation policies as discussed above
and product warranty, the Company is not contractually obligated to accept
returned merchandise.

The Company's reserve for doubtful accounts totals $1,400,000, which management
believes is adequate.

RECENT ACCOUNTING PRONOUNCEMENTS

In July 2001, the Financial Accounting Standards Board ("FASB") issued Statement
of Accounting Standards No. 142, "Accounting for Goodwill" ("SFAS 142"). SFAS
142 establishes accounting standards for existing goodwill related to purchase
business combinations. Under the Statement, the Company would discontinue the
periodic amortization of goodwill effective with adoption of the Statement.
Also, the Company would have to test any remaining goodwill for possible
impairment within the first six months of adopting the Statement based on new
valuation criteria set forth in the Statement. Based on information available,
the Company estimates that annual amortization expense will be reduced
approximately $920,000 excluding any potential impairment charge which may
result from the implementation of the new impairment test criteria or
reclassification of goodwill to other intangible assets. The Statement becomes
effective in 2003 and the Company is considering early adoption in fiscal 2002.

In June 1998, the FASB issued Statement of Financial Accounting Standards No.
133, "Accounting for Derivative Instruments" ("SFAS 133"). SFAS 133 establishes
accounting and reporting standards for derivative instruments and for hedging
activities. SFAS 133 requires that an entity recognize all derivatives as either
assets or liabilities and measure those instruments at fair market value. Under
certain circumstances, a portion of the derivative's gain or loss is initially
reported as a component of other comprehensive income and subsequently
reclassified into income when the transaction affects earnings. For a derivative
not designated as a hedging instrument, the gain or loss is recognized in income
in the period of change. SFAS 133 is effective for fiscal quarters of years
beginning after June

                                       21
<PAGE>   22

15, 2000 and requires application prospectively. Presently, the Company does not
use derivative instruments either in hedging activities or as investments.
Accordingly, the adoption of SFAS 133 had no impact on the financial position or
results of operations.

In March 2000, the FASB issued interpretation No.44 ("FIN 44"), "Accounting for
Certain Transactions Involving Stock Compensation, an Interpretation of APB
Opinion No. 25". FIN 44 clarifies the application of APB Opinion No. 25 for (a)
the definition of employee for purposes of applying APB Opinion No. 25, (b) the
criteria for determining whether a plan qualifies as a noncompensatory plan, (c)
the accounting consequences of various modifications to the previously fixed
stock option or award, and (d) the accounting for an exchange of stock
compensation awards in a business combination. FIN 44 is effective July 2, 2000
but certain conclusions cover specific events that occur after either December
15, 1998 or January 12, 2000. The adoption of FIN 44 did not have an affect on
the Company's financial statements.

In December 1999, the Securities and Exchange Commission ("SEC") issued Staff
Accounting Bulletin No. 101 which summarizes certain of the SEC staff's views in
applying generally accepted accounting principles to revenue recognition in
financial statements. The company adopted Staff Accounting Bulletin No. 101
effective October 1, 2000. The adoption of this guidance did not have a material
impact on the Company's results of operations or financial position; however,
the guidance may impact the way in which the company will account for future
transactions.

ADDITIONAL FACTORS THAT MAY AFFECT OUR BUSINESS AND FUTURE RESULTS

THE COMPANY CAUTIONS THAT CERTAIN STATEMENTS IN THIS REPORT AND IN THE COMPANY'S
OTHER PERIODIC REPORTS FILED PURSUANT TO THE UNITED STATES SECURITIES AND
EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT"), IN MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS" AND
ELSEWHERE , MAY BE FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION 27A
OF THE SECURITIES ACT AND SECTION 21E OF THE EXCHANGE ACT, THE "SAFE HARBOR" FOR
FORWARD LOOKING STATEMENTS ENACTED IN THE PRIVATE SECURITIES LITIGATION REFORM
ACT OF 1995. THE FORWARD LOOKING STATEMENTS THAT MAY BE CONTAINED IN THE
COMPANY'S REPORTS UNDER THE EXCHANGE ACT AND IN OTHER ORAL OR WRITTEN STATEMENTS
MADE BY THE COMPANY OR BY ITS AUTHORIZED REPRESENTATIVES INVOLVE A NUMBER OF
RISKS AND UNCERTAINTIES. AS A CONSEQUENCE, ACTUAL RESULTS MIGHT DIFFER
MATERIALLY FROM RESULTS FORECAST OR SUGGESTED IN THESE FORWARD LOOKING
STATEMENTS. SOME OF THESE RISKS AND UNCERTAINTIES ARE IDENTIFIED IN THE
DISCUSSION TO FOLLOW. ADDITIONAL INFORMATION REGARDING THESE FACTORS AND OTHER
IMPORTANT FACTORS THAT COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY MAY BE
REFERRED TO AS PART OF PARTICULAR FORWARD LOOKING STATEMENTS. THE
FORWARD-LOOKING STATEMENTS MADE BY THE COMPANY OR ON ITS BEHALF ARE QUALIFIED IN
THEIR ENTIRETY BY REFERENCE TO THE IMPORTANT FACTORS DISCUSSED BELOW AND TO
THOSE THAT MAY BE DISCUSSED AS PART OF PARTICULAR FORWARD-LOOKING STATEMENTS.

The Company cautions that the following important risk factors, among others,
could cause actual results for the fiscal year ended April 30, 2002 and for
subsequent financial reporting periods to differ materially from those forecast
or suggested in any forward-looking statement made by the Company or on its
behalf, in this report and otherwise. A number of these important factors have
been discussed in this Annual Report on Form 10-K for the fiscal year ended
April 30, 2001 and its quarterly reports on Form 10-Q previously filed with the
United States Securities and Exchange Commission.

WE HAVE A HISTORY OF  LOSSES AND MAY EXPERIENCE FUTURE LOSSES

We have incurred net losses of $12,815,000, $5,550,000 and $9,089,000 for the
years ended April 30, 2001, 2000 and 1999, respectively. These losses are
primarily attributable to sales levels insufficient to meet the costs associated
with the development and marketing of new products in an emerging technology and
to litigation costs and costs associated with the Chapter 11 bankruptcy
described below. Sales levels have been negatively impacted due to the broad
based decline in demand for telecommunications equipment. There can be no
assurance that the Company will generate sufficient revenues to meet expenses or
to operate profitably in the future. These losses present a significant risk to
our stockholders. If we cannot achieve profitability or positive cash flows from
operating activities, we may be unable to meet our working capital and other
payment obligations, which would have a material adverse effect on our business,
financial condition and results of operation and the price of our common stock.
In addition, if we cannot return to sustained profitability we will be forced to
sell all or part of our business, liquidate or seek to reorganize.

                                       22
<PAGE>   23

WE RECENTLY EMERGED FROM BANKRUPTCY

On June 2, 1998, the Company filed a voluntary petition for reorganization under
Chapter 11 of the federal bankruptcy laws in the United States Bankruptcy Court
for the Eastern District of Virginia. This filing was a direct result of
enforcement activities by a judgment creditor. All litigation related to this
matter has now been settled. On March 30, 1999, the Company's Plan of
Reorganization was approved by the Bankruptcy Court and the Company emerged from
Chapter 11. The Plan of Reorganization became effective on April 12, 1999. The
Plan provides for cash and debenture payments equal to 100% of each allowed
claim plus interest. The positions of all common shareholders were preserved.
The Chapter 11 bankruptcy filing had a negative impact on the Company's sales,
its relationships with vendors and its ability to hire and retain qualified
employees, among other areas.

WE ARE ENGAGED IN A HIGHLY COMPETITIVE BUSINESS.

The market for networking systems is extremely competitive. In most of the
markets in which we compete our competitors are more established, benefit from
greater market recognition and have greater financial, technological, production
and marketing resources than we do. Competition could become even more intense
if new companies enter the market or if our existing competitors expand their
product lines. We compete on the basis of product features and capabilities,
performance and price. An increase in competition could have an adverse effect
on our operating results, both in terms of decreased market share and revenues
and increased investments in research and development and sales and marketing in
order to remain competitive. There can be no assurance that we will be able to
make technological advances or that we will have sufficient resources to fund
the necessary research and development and marketing and sales efforts that will
enable us to profitably compete in our markets.

WE RELY ON A LIMITED NUMBER OF KEY EMPLOYEES .

Our success depends to a significant degree upon the continued contributions of
our management, marketing, engineering and technical personnel, many of whom
would be difficult to replace. There is intense competition for qualified
personnel in our industry, and there can be no assurance that we will be able to
attract and retain the qualified personnel necessary for the development of our
business. Loss of the services of any of our key employees would be detrimental
to our development. We do not have "key man" life insurance on any of our
officers or directors..

WE MUST BE ABLE TO ADAPT TO CHANGES IN PROTOCOL AND OTHER TECHNOLOGY.

New data signaling protocols may be developed that could displace the protocols
currently supported in Company products, requiring additional software
development to sustain the viability of those products. An announcement of such
new protocols could have a negative effect on sales of older designs, as users
hesitate to install equipment based on existing designs until they have
evaluated the new ones. There can be no assurance that the Company would have
the necessary resources, particularly the knowledgeable employees, to implement
new protocols in a timely manner. Such failure to develop adequate products in
response to new technology could adversely affect the Company's profitability.

WE MUST INTRODUCE NEW PRODUCTS TO COMPETE

The Company's future revenue is dependent on its ability to successfully
develop, manufacture and market products. In this regard, future growth is
dependent on the Company's ability to timely and successfully develop and
introduce new products, establish new distribution channels, develop
affiliations with leading market participants which facilitate product
development and distribution, and market existing and new products with service
providers, resellers, channel partners, and others. The introduction of new or
enhanced products requires the Company to manage the transition from older
products in order to minimize disruption in customer ordering patterns, avoid
excessive levels of older product inventories and ensure that adequate supplies
of new products can be delivered to meet customer demand. In addition, as the
technical complexity of new products increases, it may become increasingly
difficult to introduce new products quickly and according to schedule. There can
be no assurance that the Company will successfully manage the transition to new
products or that the Company's research and development efforts will result in
commercially successful new technology and products in the future.

WE REQUIRE ADDITIONAL CAPITAL TO CONTINUE OUR OPERATIONS AND WE CANNOT BE
CERTAIN THAT THE NECESSARY FUNDS WILL BE AVAILABLE

                                       23
<PAGE>   24

Our ability to return to and maintain profitability is largely dependent upon
our ability to introduce new products and technologies and expand our sales
efforts in new geographic and product markets. These activities require
substantial capital, and if we do not have access to sufficient funds, either
from our own operations or through third party financing, our ability to make
these necessary expenditures will be limited. Our current available cash and our
anticipated cash from operations are insufficient to fund our operations until
we are able to attain profitability, and the audit report of our independent
public accountants reflects this contingency. Accordingly, we will require third
party financing in order to continue our operations. We cannot assure you that
we will be able to obtain financing on terms favorable to us, or at all. If we
obtain additional funds by selling any of our equity securities, the percentage
ownership of our stockholders will be reduced, stockholders may experience
additional dilution, or the equity securities may have rights, preferences or
privileges senior to the common stock. If we obtain additional funds by selling
assets, there can be no assurance that we will be able to negotiate a favorable
price for those assets or that the loss of those assets will not affect our
future business prospects. If adequate funds are not available to us or
available to us on satisfactory terms, we may be required to limit our marketing
and product development activities or other operations, or otherwise modify our
business strategy. These actions, if taken, could increase the difficulties we
face in returning to sustained profitability.

SOME COMPONENTS OF OUR PRODUCTS ARE AVAILABLE TO US ONLY FROM A LIMITED NUMBER
OF SUPPLIERS

Certain components used in our products are currently available from only one
source and other of the components are available from only a limited number of
suppliers. Although we have generally been able to obtain adequate supplies of
components to date, our inability to develop alternative sources if and as
required in the future, or to obtain sufficient sole source or limited source
components as required, could result in delays or reductions in product
shipments. Certain products that are or may in the future be marketed with or
incorporated into our products are supplied by or are under development by third
parties. These third parties may be the sole suppliers of such products. While
the Company believes there are a number of suitable manufacturers, there can be
no assurance that current or alternative sources will be able to supply all of
our demands on a timely basis. Also, an unanticipated interruption in supply
could have a short-term effect on our business. It will not be economically
practical for the Company to develop its own manufacturing capacity in the
foreseeable future.

WE ARE DEPENDENT ON INTELLECTUAL PROPERTY RIGHTS TO PROTECT OUR POSITION IN THE
INDUSTRY

The Company's success depends in part upon its technological expertise and
proprietary product designs. The Company relies upon its trade secret protection
efforts and, to a lesser extent, copyrights to protect its proprietary
technologies. There can be no assurance that these steps will be adequate to
deter misappropriation or infringement of its proprietary technologies or that
the Company's competitors will not independently develop technologies that are
substantially equivalent or superior to the Company's technology. In addition,
the laws of some foreign countries do not protect the Company's proprietary
rights to the same extent as do the laws of the United States. Further, given
the rapid evolution of technology and uncertainties in intellectual property
law, there can be no assurance that the Company's current or future products
will not be determined to infringe proprietary rights of others. Should the
Company be sued for patent infringement, there can be no assurance that the
Company will prevail, or, if required by such litigation, that it will be able
to obtain the requisite licenses or rights to use such technology on
commercially reasonable terms. In addition, any litigation, regardless of the
outcome, could result in substantial costs to the Company.

WE COULD BE AFFECTED BY GOVERNMENTAL RESTRAINTS OR CHANGES IN GOVERNMENTAL
POLICY

The Company's products are subject to regulation by the Federal Communications
Commission (the "FCC"), and each of the Company's products must typically be
tested before it can be introduced into the market. Any inability of the
Company's products to conform to FCC regulations or any failure of the Company's
products to meet FCC testing requirements could delay the introduction of the
Company's products into the market, impact the Company's relationships with its
OEMs and otherwise adversely affect the Company. Foreign authorities often
establish telecommunications standards different from those in the United
States, making it difficult and more time-consuming to obtain the required
regulatory approvals. Any significant delay in obtaining such regulatory
approvals could have an adverse effect on the Company's operating results.
Furthermore, changes in such laws, regulations, policies or requirements could
affect the demand for the Company's products or result in the need to modify
products, which may involve substantial costs or delays in sales and could have
an adverse effect on the Company's future operating results.

                                       24
<PAGE>   25

OUR OUTSTANDING SHARES MAY BE DILUTED

A substantial number of shares of Common Stock are or will be issuable by the
Company upon the exercise of warrants and options which the Company has issued,
which could result in dilution to a Shareholder's percentage ownership interest
in the Company and could adversely affect the market price of the Common Stock.

On July 20, 2001, there were issued and outstanding a total of 29,066,624 shares
of Common Stock. If all convertible debentures, warrants and stock options which
the Company has issued were deemed converted and exercised, as the case may be,
as of that date, there would be issuable approximately 20,851,763 shares of
Common Stock. Upon such conversion and exercise, there would be outstanding
49,912.721 shares of Common Stock. The sale or availability for sale of a
significant number of shares of Common Stock in the public market could
adversely affect the market price of the Common Stock. The availability to the
Company of additional equity financing, and the terms of any such financing, may
also be adversely affected by the foregoing.

WE RECENTLY RE-PRICED SUBSTANTIALLY ALL OF OUR STOCK OPTIONS TO A LOWER EXERCISE
PRICE AND THE RESULTING ACCOUNTING CHARGES MAY CAUSE OUR FUTURE EARNINGS TO
FLUCTUATE WIDELY

As part of a program to retain its employees, the Company adopted a program to
re-price the options of its current employees. The Company also re-priced the
options issued to its board of directors and to its chairman of the board. Under
the program, the exercise price of current stock options was changed to $0.51
per share. Although each employee could elect not to participate in this
program, the exercise price of approximately 2.5 million options was changed to
the lower price. Under applicable accounting rules, the Company will have to
account for future variations in the price of its common stock above $0.51 per
share as compensation expense until the repriced options are either exercised,
cancelled or expire. This calculation will be made each quarter based upon the
performance of the Company's common stock in that quarter. Accordingly,
operating results and earnings per share will be subjected to potentially
significant fluctuations based upon changes in the market price of the Company's
common stock.

POTENTIAL FLUCTUATIONS IN QUARTERLY RESULTS AND GROWTH RATE

A significant portion of the Company's sales are derived from products shipped
against firm purchase orders received in each fiscal quarter and from products
shipped against firm purchase orders released in that quarter. Unforeseen delays
in product deliveries or the closing of sales, introduction of new products by
the Company or its competitors, fluctuations in customer capital expenditures or
other conditions affecting the networking industry or the economy during any
fiscal quarter could cause quarterly revenue and net earnings to vary greatly.
Further, the Company schedules some production of its products and budgets
expenses based on forecasts of sales, which are difficult to predict. The
Company's manufacturing procedures are designed to assure rapid response to
customer demand, but may, in certain circumstances, create risk of excess or
inadequate inventory if orders do not match forecast. Moreover, shortages or
delays in the supply of manufacturing components or shipments at acceptable
prices could adversely affect the Company's ability to meet scheduled product
shipments in any particular quarter, which could materially affect the Company's
operating results. Because a substantial portion of customer orders are filled
within the fiscal quarter of receipt, and because of the ability of customers to
revise or cancel orders and change delivery schedules without significant
penalty, quarter to quarter revenues and, to a greater degree, net earnings, may
be subject to greater variability and less predictability.

TECHNOLOGICAL CHANGES

The markets for the Company's products are characterized by continuous
technological change, evolving industry standards and frequent product
introductions. Such changes in the market may adversely affect the Company's
ability to sell its products. The Company's ability to anticipate changes in
technology, industry standards and to develop and introduce new and enhanced
products on a timely basis that are successful in the market, will be
significant factors in the Company's competitive position and its prospects for
growth. Moreover, if technologies or standards supported by the Company's
products or carrier service offerings based on the Company's products become
obsolete or fail to gain widespread commercial acceptance, the Company's
business may be adversely affected. As a result, Management believes that
significant expenditures for research and development will be required in the
future. Research and development project schedules for high technology products
are inherently difficult to predict and there can be no assurance that the
Company will achieve its expected initial shipment dates

                                       25
<PAGE>   26

for products in development. Because timely availability of new and enhanced
products is critical to the success of the Company, delays in availability of
these products, or lack of market acceptance of such products, could adversely
affect the Company.

MARKET PRICE VOLATILITY OF SHARES OF COMMON STOCK

The Company's shares of common stock have been subject to substantial market
price volatility, some of which has occurred when there have been variations
between the Company's actual or anticipated financial results and the
expectations of that of the financial community and in the aftermath of public
announcements by the Company and its competitors. Further, the stock market has
experienced extreme price and volume fluctuations from time to time which have
affected the market price of many technology companies in particular and which
have often been unrelated to the operating performance of these companies. These
broad market fluctuations, as well as general economic conditions, may adversely
affect the market price of the Company's shares of common stock. The Company's
shares of common stock are currently quoted on the NASDAQ OTC Bulletin Board.

OTHER FACTORS

THE COMPANY FURTHER CAUTIONS THAT THE FACTORS REFERRED TO ABOVE AND THOSE
REFERRED TO AS PART OF PARTICULAR FORWARD LOOKING STATEMENTS MAY NOT BE
EXHAUSTIVE, AND THAT NEW RISK FACTORS EMERGE FROM TIME TO TIME IN ITS RAPIDLY
CHANGING BUSINESS. FURTHER, THE COMPANY'S INDEPENDENT AUDITORS HAVE INCLUDED A
PARAGRAPH IN THEIR OPINION WHICH INDICATES THAT, BASED ON RECENT OPERATING
LOSSES, ALONG WITH EXISTING WORKING CAPITAL AND ACCUMULATED DEFICITS, THERE IS
SUBSTANTIAL DOUBT ABOUT THE COMPANY'S ABILITY TO CONTINUE AS A GOING CONCERN.
THE COMPANY DOES NOT UNDERTAKE TO UPDATE ANY FORWARD LOOKING STATEMENTS IT MAY
MAKE OR HAS MADE ON ITS BEHALF TO REFLECT CHANGES IN ITS EXPECTATIONS OR
ASSUMPTIONS OR THE RISKS AND UNCERTAINTIES REFERRED TO.


ITEM 7A.  MARKET RISK

In the normal course of business, operations of the Company may be exposed to
fluctuations in currency values and interest rates. These fluctuations can vary
the costs of financing, investing, and operating transactions. Because the
Company has only fixed rate long term convertible debentures and no foreign
currency transactions, there is no material impact on earnings by fluctuations
in interest and currency exchange rates.


                                       26
<PAGE>   27



ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The following financial statements and financial statement schedules are filed
as part of this Report:

<TABLE>
<CAPTION>
                                                                                         Page
                                                                                         ----

<S>                                                                                    <C>
Report of Independent Certified Public Accountants                                         F-1

Balance Sheets at April 30, 2001 and 2000                                                  F-2

Statements of Operations for the Years Ended April 30, 2001, 2000 and 1999                 F-4

Statements of Stockholders' Equity for the Years Ended April 30, 2001, 2000 and 1999       F-6

Statements of Cash Flows for the Years Ended April 30, 2001, 2000 and 1999                 F-7

Summary of Accounting Policies                                                             F-9

Notes to Financial Statements                                                             F-14

Report of Independent Certified Public Accountants on Financial Statement Schedule        F-39

Valuation and Qualifying Accounts (Schedule II)                                           F-40
</TABLE>



                                       27
<PAGE>   28

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS


Board of Directors and Stockholders
FASTCOMM COMMUNICATIONS CORPORATION

We have audited the accompanying balance sheets of FASTCOMM COMMUNICATIONS
CORPORATION as of April 30, 2001 and 2000, and the related statements of
operations, stockholders' equity, and cash flows for each of the three years in
the period ended April 30, 2001. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
presentation of the financial statements. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of FASTCOMM COMMUNICATIONS
CORPORATION at April 30, 2001 and 2000, and the results of its operations and
its cash flows for each of the three years in the period ended April 30, 2001 in
conformity with accounting principles generally accepted in the United States of
America.

The accompanying financial statements have been prepared assuming the Company
will continue as a going concern. The Company has sustained significant
operating losses and cash flow deficits in 2001, 2000 and 1999. In addition, the
Company must obtain funds from outside sources in 2002 to provide needed
liquidity and successfully implement its business plan. Presently, the Company
has no firm commitments from outside sources to provide these funds. These
factors raise substantial doubt about the Company's ability to continue as a
going concern. Management's plans in regard to these matters are described in
Note 1. The financial statements do not contain any adjustments that might
result from the outcome of these uncertainties.


                                                   BDO Seidman, LLP

Washington, D.C.
July 20, 2001

                                                                               1
<PAGE>   29


                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                                  BALANCE SHEETS
================================================================================

<TABLE>
<CAPTION>
 April 30,                                                            2001         2000
------------------------------------------------------------------------------------------
<S>                                                              <C>           <C>
ASSETS

CURRENT
   Cash and cash equivalents (including temporary investments
     of $430,000 in 2000)                                            $69,125      $548,136
   Restricted cash (Notes 8 and 9)                                        --       321,723
   Accounts receivable, net (Notes 4 and 8)                        1,347,893     2,865,727
   Receivable from employees                                          31,633        84,000
   Inventory, net (Notes 5 and 8)                                  2,759,284     2,405,747
   Prepaid expenses and other current assets                          13,628       168,131
------------------------------------------------------------------------------------------

TOTAL CURRENT ASSETS                                               4,221,563     6,393,464
------------------------------------------------------------------------------------------

PROPERTY AND EQUIPMENT, at cost, less accumulated
   depreciation and amortization (Note 6)                          1,147,594     1,690,011
------------------------------------------------------------------------------------------

OTHER
   Goodwill, net of accumulated amortization of $3,549,910 and
     $797,828 (Note 3)                                             8,714,070    12,547,854
   Deferred investment advisory fees (Note 9)                        120,172       480,688
   Deposits                                                           18,830        87,215
------------------------------------------------------------------------------------------

TOTAL OTHER ASSETS                                                 8,853,072    13,115,757
------------------------------------------------------------------------------------------







                                                                 $14,222,229   $21,199,232
===========================================================================================
</TABLE>
See accompanying summary of accounting policies and notes to financial
statements.


                                                                               2
<PAGE>   30


                                             FASTCOMM COMMUNICATIONS CORPORATION



                                                                  BALANCE SHEETS
================================================================================

<TABLE>
<CAPTION>


 April 30,                                                                         2001         2000
-----------------------------------------------------------------------------------------------------------
<S>                                                                           <C>             <C>
LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
   Check issued against future deposits                                         $   111,278    $         --
   Current portion of notes payable (Note 8)                                      1,000,000       1,000,000
   Revolving line of credit and term loan (Note 8)                                  356,200       1,268,319
   Current portion of capital lease obligations (Note 8)                              1,519          11,281
   Accounts payable                                                               3,074,381       2,583,161
   Accrued compensation                                                             978,011         519,030
   Deferred revenue                                                                      --         322,801
   Other current liabilities (Note 7)                                             1,556,283         953,281
-----------------------------------------------------------------------------------------------------------

TOTAL CURRENT LIABILITIES                                                         7,077,672       6,657,873
-----------------------------------------------------------------------------------------------------------

Convertible debentures (Notes 8 and 9)                                              732,643         767,602
Capital lease obligations (Note 8)                                                       --           3,543
-----------------------------------------------------------------------------------------------------------

TOTAL LONG TERM DEBT                                                                732,643         771,145
-----------------------------------------------------------------------------------------------------------

TOTAL LIABILITIES                                                                 7,810,315       7,429,018
-----------------------------------------------------------------------------------------------------------

COMMITMENTS AND CONTINGENCIES  (Note 13)

STOCKHOLDERS' EQUITY (Notes 3, 9 and 10)
   Common stock, $.01 par - 50,000,000
     shares authorized; 29,066,624 and 25,578,472 shares
     issued and outstanding                                                         290,666         255,784
   Additional paid-in capital                                                    48,812,608      43,391,257
   Accumulated deficit                                                          (42,691,360)    (29,876,827)
-----------------------------------------------------------------------------------------------------------

TOTAL STOCKHOLDERS' EQUITY                                                        6,411,914      13,770,214
-----------------------------------------------------------------------------------------------------------

                                                                                $14,222,229     $21,199,232
-----------------------------------------------------------------------------------------------------------
</TABLE>

See accompanying summary of accounting policies and notes to financial
statements.



                                                                               3

<PAGE>   31


                                             FASTCOMM COMMUNICATIONS CORPORATION


                                                        STATEMENTS OF OPERATIONS
================================================================================
<TABLE>
<CAPTION>

 Year ended April 30,                                        2001             2000           1999
------------------------------------------------------------------------------------------------------
<S>                                                     <C>              <C>            <C>

REVENUES (Note 12)
   Product sales                                        $ 10,056,422     $ 6,402,255     $ 4,091,843
   Service revenue                                           861,621          12,662         561,462
------------------------------------------------------------------------------------------------------

TOTAL REVENUES                                            10,918,043       6,414,917       4,653,305
------------------------------------------------------------------------------------------------------

OPERATING COSTS AND EXPENSES
   Cost of goods sold                                      4,797,690       4,074,058       2,679,255
   Selling, general and administrative                     7,662,063       4,984,334       4,747,003
   Research and development                                5,684,366       2,966,012       2,387,904
   Restructuring costs (Note 15)                           1,588,501              --              --
   Depreciation and amortization                           3,906,680       1,092,896         475,223
------------------------------------------------------------------------------------------------------

TOTAL OPERATING COSTS AND EXPENSES                        23,639,300      13,117,300      10,289,385
------------------------------------------------------------------------------------------------------

OPERATING LOSS                                           (12,721,257)     (6,702,383)     (5,636,080)
------------------------------------------------------------------------------------------------------

OTHER INCOME (EXPENSE)
   Other income (expense)                                    168,644          22,691          (7,635)
   Interest income                                            23,805          54,860           8,950
   Interest expense                                         (285,725)       (191,930)       (104,894)
------------------------------------------------------------------------------------------------------

TOTAL OTHER INCOME (EXPENSE)                                 (93,276)       (114,379)       (103,579)
------------------------------------------------------------------------------------------------------

LOSS BEFORE REORGANIZATIONAL ITEMS AND
   EXTRAORDINARY ITEM                                    (12,814,533)     (6,816,762)     (5,739,659)

REORGANIZATIONAL ITEMS
   Professional fees                                              --              --         662,888
   Interest earned on accumulated cash resulting from
     Chapter 11 proceeding                                        --              --         (19,847)
------------------------------------------------------------------------------------------------------

TOTAL REORGANIZATIONAL ITEMS                                      --              --         643,041
------------------------------------------------------------------------------------------------------

LOSS BEFORE EXTRAORDINARY ITEM                           (12,814,533)     (6,816,762)     (6,382,700)

EXTRAORDINARY GAIN (Note 2)                                       --              --         833,149
------------------------------------------------------------------------------------------------------

NET LOSS                                                 (12,814,533)     (6,816,762)     (5,549,551)

DIVIDEND ON PREPAID WARRANTS (NOTE 9)                        (98,417)             --              --
------------------------------------------------------------------------------------------------------

NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS            $(12,912,950)    $(6,816,762)    $(5,549,551)
======================================================================================================
</TABLE>

See accompanying summary of accounting policies and notes to financial
statements.


                                                                               4
<PAGE>   32




                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                        STATEMENTS OF OPERATIONS
================================================================================
<TABLE>
<CAPTION>
 Year ended April 30,                                    2001               2000            1999
-----------------------------------------------------------------------------------------------------
<S>                                                 <C>               <C>              <C>

Basic and diluted loss before extraordinary
   item                                             $     (0.48)      $     (0.35)      $     (0.49)

Extraordinary gain                                        --                --                  .06
-----------------------------------------------------------------------------------------------------

Basic and diluted loss per common share             $     (0.48)      $     (0.35)      $     (0.43)
=====================================================================================================

WEIGHTED-AVERAGE NUMBER OF COMMON SHARES
   OUTSTANDING DURING EACH YEAR                       26,568,676        19,277,293        12,917,125
=====================================================================================================
</TABLE>
See accompanying summary of accounting policies and notes to financial
statements.

                                                                               5

<PAGE>   33




                                            FASTCOMM COMMUNICATIONS CORPORATION

                                              STATEMENTS OF STOCKHOLDERS' EQUITY
================================================================================
<TABLE>
<CAPTION>



Year ended April 30, 2001, 2000 and 1999
===========================================================================================================================

                                                       Common Stock
                                                ---------------------------    Additional
                                                                   Par          Paid-in       Accumulated
                                                   Shares         Value         Capital          Deficit          TOTAL
===========================================================================================================================

<S>                                             <C>          <C>            <C>             <C>             <C>
BALANCE, April 30, 1998                          12,048,753   $    120,488   $ 20,636,197    $(17,510,514)   $  3,246,171

   Shares issued on conversion of debentures      1,652,717         16,527      1,056,783              --       1,073,310
   Shares issued for acquisition of
     KG Data Systems, Inc.                          719,149          7,191        837,809              --         845,000
   Proceeds from exercise of warrants               389,022          3,890        417,211              --         421,101
   Proceeds from sale of stock                    1,333,333         13,333        986,667              --       1,000,000
   Net loss                                              --             --             --      (5,549,551)     (5,549,551)
----------------------------------------------------------------------------------------------------------------------------

BALANCE, April 30, 1999                          16,142,974        161,429     23,934,667     (23,060,065)      1,036,031

   Shares issued on conversion of debentures        788,160          7,882      2,042,354              --       2,050,236
   Shares issued for acquisition of
     Cronus Technology, Inc.                      2,944,988         29,450      9,245,682              --       9,275,132
   Proceeds from exercise of stock options          182,238          1,822        310,889              --         312,711
   Shares issued on settlement of notes
     payable                                        728,063          7,281      1,855,861              --       1,863,142
   Warrants issued to nonemployees                       --             --        570,817              --         570,817
   Proceeds from exercise of warrants             3,682,009         36,820      4,355,364              --       4,392,184
   Proceeds from sale of stock                    1,110,040         11,100      1,075,623              --       1,086,723
   Net loss                                              --             --             --      (6,816,762)     (6,816,762)
----------------------------------------------------------------------------------------------------------------------------

BALANCE, April 30, 2000                          25,578,472        255,784     43,391,257     (29,876,827)     13,770,214

Shares issued on conversation of debentures          43,465            435         39,185              --          39,620
Shares issued for acquisition of Cronus
   Technology, Inc.                               2,035,734         20,357        (20,357)             --              --
Proceeds from exercise of stock options              82,161            822         45,654              --          46,476
Shares issued on settlement of liabilities           37,500            375         80,402              --          80,777
Proceeds from sale of prepaid warrants                   --             --      3,845,250              --       3,845,250
Proceeds from exercise of warrants                  256,729          2,567        351,321              --         353,888
Proceeds from sale of stock                       1,032,563         10,326      1,178,313              --       1,188,639
Dividend on prepaid warrants                             --             --        (98,417)             --         (98,417)
Net loss                                                 --             --             --     (12,814,533)    (12,814,533)
---------------------------------------------------------------------------------------------------------------------------

BALANCE, APRIL 30, 2001                          29,066,624   $    290,666   $ 48,812,608    $(42,691,360)   $  6,411,914
===========================================================================================================================
</TABLE>
See accompanying summary of accounting policies and notes to financial
statements.


                                                                               6
<PAGE>   34



                                            FASTCOMM COMMUNICATIONS CORPORATION

                                                        STATEMENTS OF CASH FLOWS
================================================================================

<TABLE>
<CAPTION>

Year ended April 30,                                        2001            2000            1999
===================================================================================================
<S>                                                 <C>             <C>             <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net loss                                         $(12,814,533)   $ (6,816,762)   $ (5,549,551)
   ADJUSTMENTS TO RECONCILE NET LOSS
      TO NET CASH USED IN OPERATING ACTIVITIES
         Depreciation and amortization                 3,906,680       1,092,896         475,223
         Extraordinary gain                                   --              --        (833,149)
         Compensation expense associated with
            stock options and warrants                        --         223,639          33,079
         Provision for doubtful accounts               1,328,923           1,764          78,792
         Write off of accounts receivable               (203,923)        (26,764)        (78,792)
         Provision for inventory obsolescence            772,541         815,347          80,000
         Write off of inventory                         (772,541)     (1,665,347)             --
         Impairment of goodwill                          346,587              --              --
         Amortization of deferred financing costs        360,516          12,671          63,673
         Accrued interest converted to stock               4,661         127,480          68,011
         Loss on disposal of equipment                        --              --           2,516
   CHANGES IN ASSETS AND LIABILITIES,
      NET OF EFFECTS OF ACQUISITIONS
   (INCREASE) DECREASE IN ASSETS
      Accounts receivable                                392,834        (750,812)      2,533,379
      Receivable from employees                           52,367         (54,000)        (27,240)
      Inventory                                         (353,537)      2,216,398         439,278
      Prepaid expenses and other current assets          154,503         131,936         146,494
      Deposits                                            68,385         (12,078)         (7,729)
   INCREASE (DECREASE) IN LIABILITIES
      Accounts payable                                   491,220         102,879         880,849
      Accrued compensation                               695,679        (340,424)        (97,672)
      Deferred revenue                                   (23,244)         (6,205)             --
      Other current liabilities                          348,664         379,813        (315,836)
      Provision for litigation settlement                     --              --        (220,403)
---------------------------------------------------------------------------------------------------

   NET CASH USED IN OPERATING ACTIVITIES              (5,244,218)     (4,567,569)     (2,329,078)
---------------------------------------------------------------------------------------------------
</TABLE>


                                                                               7
<PAGE>   35

                                            FASTCOMM COMMUNICATIONS CORPORATION

                                                        STATEMENTS OF CASH FLOWS
================================================================================

<TABLE>
<CAPTION>

 Year ended April 30,                                         2001           2000           1999
===================================================================================================
<S>                                                    <C>            <C>            <C>
CASH FLOWS FROM INVESTING ACTIVITIES
   Purchase of property and equipment                  $  (235,442)   $  (526,934)   $  (212,189)
   Payment received on notes receivable                         --             --        150,000
   Payment on capital lease obligation                     (13,305)            --             --
   Net cash from Cronus Technology acquisition                  --        181,718             --
   Other cash received                                      58,819             --            208
--------------------------------------------------------------------------------------------------

NET CASH USED IN INVESTING ACTIVITIES                     (189,928)      (345,216)       (61,981)
--------------------------------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
   Increase in checks issued against future deposits       111,278             --             --
   Net proceeds from issuance of common stock            1,188,639      1,086,723      1,000,000
   Proceeds from exercise of warrants                      353,888      4,392,184        421,101
   Proceeds from exercise of stock options                  46,476        312,711             --
   Proceeds from issuance of prepaid warrants            3,845,250             --             --
   (Increase) decrease in restricted cash                  321,723       (169,356)      (152,367)
   Principal payments on debt                             (912,119)      (252,068)            --
--------------------------------------------------------------------------------------------------

NET CASH PROVIDED BY FINANCING ACTIVITIES                4,955,135      5,370,194      1,268,734
--------------------------------------------------------------------------------------------------

NET INCREASE (DECREASE) IN CASH AND CASH
   EQUIVALENTS                                            (479,011)       457,409     (1,122,325)

CASH AND CASH EQUIVALENTS, beginning of year               548,136         90,727      1,213,052
--------------------------------------------------------------------------------------------------

CASH AND CASH EQUIVALENTS, end of year                 $    69,125    $   548,136    $    90,727
==================================================================================================
</TABLE>
See accompanying summary of accounting policies and notes to financial
statements.


                                                                               8
<PAGE>   36


                                            FASTCOMM COMMUNICATIONS CORPORATION

                                                  SUMMARY OF ACCOUNTING POLICIES
================================================================================

ORGANIZATION            FastComm Communications Corporation (the "Company") was
                        incorporated in Virginia in May 1983. The Company
                        designs, manufactures, and markets data communications
                        equipment for high-speed data transmission over public
                        and private telephone networks. Management believes that
                        the Company operates in one business segment.


USE OF ESTIMATES        The preparation of financial statements in conformity
                        with generally accepted accounting principles requires
                        management to make estimates and assumptions that affect
                        the reported amounts of assets and liabilities and the
                        disclosure of contingent assets and liabilities at the
                        date of the financial statements and the reported
                        amounts of revenues and expenses during the reporting
                        period. Actual results could differ from those
                        estimates. Certain estimates used by management are
                        particularly susceptible to significant changes in the
                        economic environment. These include estimates of
                        inventory obsolescence, valuation allowances for trade
                        receivables and deferred tax assets and evaluation of
                        the impairment of goodwill. Each of these estimates, as
                        well as the related amounts reported in the financial
                        statements, are sensitive to near term changes in the
                        factors used to determine them. A significant change in
                        any one of those factors could result in the
                        determination of amounts different than those reported
                        in the financial statements. Management believes that as
                        of April 30, 2001, the estimates used in the financial
                        statements are adequate based on the
                        information currently available.


RISKS AND               The Company's future operating results may be affected
UNCERTAINTIES           by a number of factors. Sales to three customers
                        aggregated 35% and 45% of total revenue in 2001 and
                        2000, respectively. Sales to one customer were 28% of
                        total revenue in 1999. The risk to the Company is that a
                        loss of one or two customers could have a significant
                        negative impact on revenues and operating results (see
                        Note 12).


                        The Company sells primarily to domestic and foreign
                        dealers and distributors. Generally sales are on credit
                        and no collateral is required, although the Company
                        reserves the right to have the products returned in the
                        event of default. The Company provides an allowance for
                        estimated sales returns and uncollectible accounts. The
                        Company's concentration of sales to certain customers,
                        discussed above, exposes the Company to a relatively
                        greater risk of loss than would be the case with greater
                        diversification.

                                                                               9
<PAGE>   37
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                  SUMMARY OF ACCOUNTING POLICIES
================================================================================

                        The Company operates in a highly volatile industry that
                        is characterized by fierce industry-wide competition
                        resulting in aggressive pricing practices, continually
                        changing customer demand patterns, growing competition
                        from well-capitalized high technology and consumer
                        electronics companies, and rapid technological
                        development. The Company's operating results could be
                        adversely affected should the Company be unable to
                        anticipate customer demand accurately, to maintain short
                        design cycles while meeting evolving industry
                        performance standards, to manage its product
                        transactions, inventory levels, and manufacturing
                        processes efficiently, to distribute its product quickly
                        in response to customer demand, to differentiate its
                        products from those of its competitors, or to compete
                        successfully in the markets for its new products.


REVENUE                 Revenues from product sales are recognized at the time
RECOGNITION             of product shipment. An allowance is provided for
                        estimated sales returns and uncollectible accounts.
                        Also, the Company establishes a reserve for estimated
                        warranty claims at the time of product shipment.


INVENTORY               Production materials are valued using standard costs,
                        which approximate the first-in, first-out (FIFO) method.
                        Work-in-process represents direct labor, materials and
                        overhead incurred on products not delivered to date.
                        Finished goods are valued at the lower of cost or
                        market, cost being determined on the specific
                        identification method.


PROPERTY,               Property and equipment is recorded at cost and
EQUIPMENT AND           depreciated on a straight-line basis over the estimated
DEPRECIATION            useful life of the related assets (generally five
                        years). Leasehold improvements are amortized over the
                        lesser of the lease term or the useful life of the
                        property.

                                                                              10
<PAGE>   38
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                  SUMMARY OF ACCOUNTING POLICIES
================================================================================

RESEARCH AND            All costs incurred to establish the technological
DEVELOPMENT COSTS       feasibility of products are considered research and
                        development costs which are charged to expense as
                        incurred.

GOODWILL                The Company has recorded goodwill based on the
                        difference between the cost and the fair value of
                        certain purchased assets and it is being amortized on a
                        straight-line basis over the estimated period of
                        benefit, which ranges from 4 to 7 years. The Company
                        periodically evaluates the goodwill for possible
                        impairment. The analysis consists of a comparison of
                        future projected undiscounted cash flows to the carrying
                        value of the goodwill. Any excess goodwill would be
                        written off due to impairment.

                        In the fourth quarter of fiscal 2001, the Company
                        decided to close its KG Data division. Therefore, there
                        are no projected undiscounted cash flows of this
                        division. Accordingly, the Company has determined that
                        the goodwill is impaired. Included in the restructuring
                        costs is $347,000 related to the impairment of this
                        goodwill. See Note 15.

ASSET                   The Company periodically evaluates the carrying value of
IMPAIRMENT              long-lived assets when events and circumstances warrant
                        such a review. The carrying value of a long-lived asset
                        is considered impaired when the anticipated undiscounted
                        cash flow from such asset is separately identifiable and
                        is less than the carrying value. In that event, a loss
                        is recognized based on the amount by which the carrying
                        value exceeds the fair market value of the long-lived
                        asset. Fair market value is determined primarily using
                        the anticipated cash flows discounted at a rate
                        commensurate with the risk involved.

INCOME TAXES            The Company accounts for income taxes in accordance with
                        Statement of Financial Accounting Standards No. 109,
                        Accounting for Income Taxes ("SFAS 109"). Under SFAS
                        109, deferred taxes are determined using the liability
                        method which requires the recognition of deferred tax
                        assets and liabilities based on differences between
                        financial statement and income tax basis using presently
                        enacted tax rates.

                                                                              11
<PAGE>   39

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                  SUMMARY OF ACCOUNTING POLICIES
================================================================================

CASH AND                The Company considers all highly liquid investments with
CASH EQUIVALENTS        an original maturity of three months or less to be cash
                        equivalents. The Company invests its excess cash
                        principally in overnight repurchase accounts and
                        short-term government securities. From time to time the
                        Company maintains amounts in excess of the federal
                        deposit insurance limitation of $100,000 in its bank
                        accounts.

COMPREHENSIVE           The Company has adopted Statement of Financial
INCOME                  Accounting Standards No. 130, "Reporting Comprehensive
                        Income". Comprehensive income as defined includes all
                        changes to equity except those resulting from
                        investments by owners and distributions to owners. The
                        Company has no items of comprehensive income to report.


LOSS PER SHARE          Loss per share is based on the weighted average number
                        of shares of common stock and dilutive common stock
                        equivalents outstanding. Basic loss per share includes
                        no dilution and is computed by dividing income available
                        to common shareholders by the weighted average number of
                        common shares outstanding for the period. Diluted loss
                        per share reflects the potential dilution of securities
                        that could share in the loss of an entity. Basic and
                        diluted loss per share are the same during 2001, 2000
                        and 1999 because the impact of dilutive securities is
                        anti-dilutive.


RECENT                  In June 1998, the Financial Accounting Standards Board
ACCOUNTING              issued Statement of Financial Accounting Standards No.
PRONOUNCEMENTS          133, "Accounting for Derivative Instruments" ("SFAS
                        133"). SFAS 133 establishes accounting and reporting
                        standards for derivative instruments and for hedging
                        activities. SFAS 133 requires that an entity recognize
                        all derivatives as either assets or liabilities and
                        measure those instruments at fair market value. Under
                        certain circumstances, a portion of the derivative's
                        gain or loss is initially reported as a component of
                        other comprehensive income and subsequently reclassified
                        into income when the transaction affects earnings. For a
                        derivative not designated as a hedging instrument, the
                        gain or loss is recognized in income in the period of
                        change. Presently, the Company does not use derivative
                        instruments either in hedging activities or as
                        investments. Accordingly, the adoption of SFAS 133 is
                        not expected to impact its financial position or results
                        of operations.


                                                                              12
<PAGE>   40


                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                  SUMMARY OF ACCOUNTING POLICIES
================================================================================

                        In March 2000, the FASB issued interpretation No. 44
                        ("FIN 44"), "Accounting for Certain Transactions
                        Involving Stock Compensation, an Interpretation of APB
                        Opinion No. 25". FIN 44 clarifies the application of APB
                        Opinion No. 25 for (a) the definition of employee for
                        purposes of applying APB Opinion No. 25, (b) the
                        criteria for determining whether a plan qualifies as a
                        noncompensatory plan, (c) the accounting consequences of
                        various modifications to the previously fixed stock
                        option or award, and (d) the accounting for an exchange
                        of stock compensation awards in a business combination.
                        FIN 44 became effective July 2, 2000 but certain
                        conclusions cover specific events that occurred after
                        either December 15, 1998 or January 12, 2000. The
                        adoption of FIN 44 did not have an effect on the
                        Company's financial statements.

                        In December 1999, the Securities and Exchange Commission
                        ("SEC") issued Staff Accounting Bulletin No. 101 which
                        summarizes certain of the SEC staff's views in applying
                        generally accepted accounting principles to revenue
                        recognition in financial statements. The Company adopted
                        Staff Accounting Bulletin No. 101 effective October 1,
                        2000. The adoption of this guidance did not have a
                        material impact on the Company's results of operations
                        or financial position, however, the guidance may impact
                        the way in which the Company will account for future
                        transactions.

                        In July 2001, the FASB issued Statement of Financial
                        Standards No. 142, "Accounting for Goodwill" ("SFAS
                        142"). SFAS 142 establishes accounting standards for
                        existing goodwill related to purchase business
                        combinations. Under the Statement, the Company would
                        discontinue the periodic amortization of goodwill
                        effective with adoption of the new Statement. Also, the
                        Company would have to test any remaining goodwill for
                        possible impairment within six months of adopting the
                        Statement, and periodically thereafter, based on new
                        valuation criteria set forth in the Statement. Further,
                        the Statement has new criteria for purchase price
                        allocation which could reduce amounts initially
                        allocated to goodwill. Based on information available,
                        the Company estimates that amortization expense in
                        fiscal 2002 will be reduced approximately $920,000,
                        excluding any potential impairment charge which may
                        result from implementation of the new impairment
                        valuation criteria or possible reclassification of
                        amounts from goodwill to other intangible assets. The
                        Statement becomes effective in 2003 and the Company is
                        considering early adoption in fiscal 2002.

                                                                              13
<PAGE>   41

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

1.    FUTURE            The accompanying financial statements have been prepared
      PROSPECTS         assuming that the Company will continue as a going
                        concern. As explained below the Company has sustained
                        recurring operating losses and cash flow deficits in
                        2001, 2000 and 1999. The Company developed a business
                        plan to increase revenue and reduce operating losses.
                        However, the Company must obtain funds from outside
                        sources in fiscal 2002 to provide needed liquidity and
                        successfully implement its business plan. Presently, the
                        Company has no firm commitments from outside sources to
                        provide these funds. These factors raise substantial
                        doubt about the Company's ability to continue in
                        existence. Management's plans in regard to these matters
                        are described in the succeeding paragraphs. The
                        financial statements do not contain any adjustments that
                        might result from the outcome of these uncertainties.

                        While the Company is optimistic that it can execute its
                        revised business plan, there can be no assurance that
                        the increased sales necessary to return to profitability
                        will materialize or if they do, that the Company will be
                        able to raise sufficient cash to fund the additional
                        working capital requirements.

                        In May 2001, the Company raised $3,000,000 through the
                        sale of a 10% senior secured convertible debenture via
                        Regulation D to Wesley Clover Corporation. All or any
                        portion of this Debenture may be converted into common
                        stock of the Company by dividing the aggregate principle
                        amount converted together with all accrued but unpaid
                        interest to the date of conversion by $0.446. The entire
                        debenture plus accrued interest shall be due and payable
                        in a single installment on June 8, 2006, unless sooner
                        accelerated or converted into common stock. In
                        connection with this investment, the Company also issued
                        3,363,229 warrants entitling Wesley Clover to purchase
                        common shares for $0.5575 per share. The warrants expire
                        on June 8, 2006 and may be called for redemption, by the
                        Company, at such time as the bid price of the Company's
                        common stock remains above $1.12 for 30 (thirty)
                        consecutive trading days. The Company will value the
                        warrants and allocate the face amount between the debt
                        and equity components.

                        When and if exercised, the unexercised warrants
                        associated with this offering and other prior offerings
                        and agreements will generate a maximum of $13,000,000 in
                        additional cash for the Company. The Company can give no
                        assurance as to whether any warrants will be exercised,
                        nor to the amount of cash that will be generated, if any
                        of these securities are exercised.

                                                                              14
<PAGE>   42
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

2.    PLAN OF           On June 2, 1998, the Company filed a voluntary petition
      REORGANIZATION    for reorganization under Chapter 11 of the United States
                        Bankruptcy Code. This filing was a direct result of
                        enforcement activities by a judgment creditor (See Note
                        13). The Company negotiated with its creditors a
                        consensual Plan of Reorganization (the "Plan") and
                        filed with the Court a Disclosure Statement and Plan of
                        Reorganization dated October 21, 1998 as modified on
                        December 23, 1998, January 8, 1999 and finally February
                        16, 1999. Creditors approved the Plan in March 1999 and
                        the Court confirmed this Plan on March 30, 1999. The
                        Plan became effective on April 12, 1999.




                        Pursuant to the Plan, Class 1 creditors, representing
                        existing holders of convertible debentures, were
                        required to convert their debt to equity within six
                        months of the effective date of the Plan. Claims of
                        unsecured creditors, below $1,000, were repaid in cash
                        on or before April 30, 1999. Claims of unsecured
                        creditors greater than $1,000 were satisfied by two cash
                        payments totaling 25% of the allowed claim on or before
                        April 30, 1999. The Company issued debentures to these
                        unsecured creditors for the remaining 75% of their
                        allowed claims. The claim of Gary Davison related to the
                        judgement of $1,195,560 obtained against the Company was
                        reduced to $900,000 and allowed as an unsecured
                        nonpriority claim. The Company then dismissed its appeal
                        of the state court verdict underlying the Davison claim
                        and Davison withdrew a second claim of $2,350,000
                        related to a pending trial on another matter associated
                        with his dismissal from the Company. Prior to
                        confirmation of the Plan, the Company's President
                        assumed the allowed claim, the effect of which is the
                        amount due Davison will now be paid to him.


                                                                              15

<PAGE>   43
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        In funding its Plan, the Company raised $1,000,000 by
                        selling common stock in a private offering. The
                        debentures, totaling $2,490,357 issued to the unsecured
                        creditors, including the President in connection with
                        purchase of the Davison claim, mature in April 2003. The
                        debentures will be convertible into common stock of the
                        Company between the first and fourth anniversary of the
                        effective date of the Plan. The debentures are
                        convertible at the average of the closing price of the
                        Company's common stock for the ten consecutive trading
                        days ending on the trading day immediately prior to
                        conversion. The debentures bear interest at 7.5%,
                        payable in common stock of the Company. If not converted
                        sooner, all debentures must be converted to common stock
                        by April 2003. The Company has the right, at anytime, to
                        redeem for cash at par value all of the outstanding
                        debentures plus any accrued interest. Each
                        debentureholder had the additional right to surrender
                        the entire debenture to the Company on April 12, 2000
                        and receive cash equal to 15% of the holder's original
                        allowed claim plus interest. As of April 30, 2001,
                        $732,643 in convertible debentures were outstanding.

                        Confirmation of the Plan on March 30, 1999 resulted in
                        an extraordinary gain determined as follows:

<TABLE>
<CAPTION>
                        ===============================================================================

<S>                                                                                     <C>
                        Accounts payable - unsecured creditors                          $ 2,849,360
                        Reserve for litigation settlement                                 1,195,560
                        -------------------------------------------------------------------------------

                        Net carrying value of liabilities exchanged                       4,044,920

                        LESS CONSIDERATION EXCHANGED:
                            Convertible debentures issued                                 2,490,357
                            Cash option to unsecured creditors                              845,014
                            Settlement of note receivable                                  (123,600)
                        -------------------------------------------------------------------------------

                        Total consideration exchanged                                     3,211,771
                        -------------------------------------------------------------------------------

                        EXTRAORDINARY GAIN                                              $   833,149
                        ===============================================================================
</TABLE>

                                                                              16
<PAGE>   44
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

3.    BUSINESS          On March 31, 2000, the Company acquired substantially
      ACQUISITIONS      all of the assets and assumed certain liabilities of
                        Cronus Technology, Inc. ("Cronus") for approximately
                        $9,600,000, plus the assumption of liabilities of
                        approximately $6,700,000 subject to adjustment as set
                        forth in the agreement. Approximately $9,300,000 of the
                        purchase price was funded through the issuance of shares
                        of the Company's common stock and approximately $300,000
                        was paid in cash. Cronus manufactures and sells
                        telecommunications equipment and provides consulting
                        services for satelite telecommunications planning. The
                        acquisition was accounted for as a purchase and,
                        accordingly, the acquired assets and liabilities were
                        recorded at their estimated fair market values at the
                        date of acquisition. The Company recorded goodwill of
                        approximately $12,000,000 related to this transaction.
                        The goodwill is being amortized on a straight line basis
                        over four years. The terms and conditions of the
                        purchase and debt assumption agreements related to this
                        transaction obligated the Company to issue additional
                        common shares if the fair market value of the Company's
                        common stock did not reach $7.30 prior to the one year
                        anniversary date of these agreements. The target price
                        was not met and accordingly, the Company issued an
                        additional 2,035,734 shares in March 2001. The maximum
                        number of shares to be issued under the purchase
                        agreement were valued as of the closing date.
                        Accordingly, there was no additional purchase price
                        adjustment. The following unaudited pro forma
                        information presents the results of operations of the
                        Company as if the acquisition had occurred on May 1,
                        1998.

<TABLE>
<CAPTION>
                        Year ended April 30,                                      2000                     1999
                        --------------------------------------------------------------------------------------------

<S>                                                                       <C>                       <C>
                        Revenue                                           $ 13,173,574              $13,859,546
                        Loss before extraordinary item                     (13,291,101)             (10,050,101)
                        Net loss                                           (13,291,101)              (9,216,952)
                        Diluted loss per common share                            (0.60)                   (0.58)

                        ============================================================================================
</TABLE>
                        These pro forma results of operations have been prepared
                        for comparative purposes only and do not purport to be
                        indicative of the results of operations which actually
                        would have resulted had the acquisition occurred on the
                        date indicated, or which may result in the future.


                                                                              17

<PAGE>   45
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================


                        On March 31, 1999, the Company acquired all of the
                        assets and assumed certain liabilities (as defined in
                        the agreement) of KG Data Systems, Inc., ("KG Data"). KG
                        Data has developed a product which transmits data
                        between IBM mainframes and remote offices. The purchase
                        price was $845,000, which was funded through the
                        issuance of 719,149 shares of the Company's common
                        stock. The acquisition was accounted for as a purchase
                        and, accordingly, the acquired assets and liabilities
                        were recorded at their estimated fair market values at
                        the date of acquisition. The Company recorded $723,325
                        of goodwill related to this transaction. This goodwill
                        is being amortized on a straight line basis over four
                        years. The operations of KG Data in 1999 were not
                        material and accordingly, the Company has not presented
                        pro forma results of operations.

                        In the fourth quarter of fiscal 2001, the Company
                        decided to close its KG Data division. Therefore, there
                        are no projected undiscounted cash flows of this
                        division. Accordingly, the Company has determined that
                        the goodwill is impaired. Included in the restructuring
                        costs is $347,000 related to the impairment of this
                        goodwill. See Note 15.

4.    ACCOUNTS          Accounts receivable consist of the following:
      RECEIVABLE

<TABLE>
<CAPTION>
                         April 30,                                        2001                       2000
                        --------------------------------------------------------------------------------------

<S>                                                                <C>                         <C>
                        Trade                                      $ 2,747,893                 $2,929,657
                        Other                                               --                    211,070
                        --------------------------------------------------------------------------------------

                                                                     2,747,893                  3,140,727

                        Allowance for doubtful accounts             (1,400,000)                  (275,000)
                        --------------------------------------------------------------------------------------

                                                                   $ 1,347,893                 $2,865,727
                        ======================================================================================
</TABLE>

                                                                              18
<PAGE>   46

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================


5.    INVENTORIES       Inventories consist of the following components:


<TABLE>
<CAPTION>
                         April 30,                                          2001                    2000
                        --------------------------------------------------------------------------------------
<S>                                                                   <C>                     <C>
                        Production materials                          $1,966,116              $1,867,371
                        Work-in-process                                  487,209                 240,408
                        Finished goods                                   905,959                 897,968
                        --------------------------------------------------------------------------------------

                                                                       3,359,284               3,005,747

                        Reserve for inventory obsolescence              (600,000)               (600,000)
                        --------------------------------------------------------------------------------------

                                                                      $2,759,284               $2,405,747
                        ======================================================================================
</TABLE>




6.    PROPERTY AND      Property and equipment consists of the following:
      EQUIPMENT

<TABLE>
<CAPTION>
                        April 30,                                        2001                       2000
                        -------------------------------------------------------------------------------------

<S>                                                               <C>                       <C>
                        Manufacturing equipment                   $   535,112               $    530,796
                        Furniture and fixtures                      1,729,877                  1,725,855
                        Leasehold improvements                        174,915                    173,143
                        Computers and electronics                     979,878                    835,027
                        Software                                    1,110,545                  1,040,001
                        Demo equipment                                427,117                    417,180
                        -------------------------------------------------------------------------------------

                                                                    4,957,444                  4,722,002

                        Less accumulated depreciation
                            and amortization                       (3,809,850)                (3,031,991)
                        -------------------------------------------------------------------------------------

                                                                   $1,147,594                $ 1,690,011
                        -------------------------------------------------------------------------------------
</TABLE>

                        Depreciation expense for the three years ended April 30,
                        2001, 2000 and 1999 was $777,859, $495,944 and $379,591,
                        respectively.
                                                                              19
<PAGE>   47

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================


7.    OTHER CURRENT     Other current liabilities consist of the following:
      LIABILITIES

<TABLE>
<CAPTION>
                        April 30,                                                2001                       2000
                        ---------------------------------------------------------------------------------------------
<S>                                                                       <C>                      <C>
                        Accrued restructuring costs                       $   617,808              $          --
                        Other accounts payable                                199,444                    362,923
                        Customer credit balances                                   --                    156,730
                        Allowance for warranty costs                          120,000                    120,000
                        Accrued professional fees                             120,107                    113,938
                        Accrued interest expense                              311,271                     74,964
                        Other                                                 187,653                    124,726
                        ---------------------------------------------------------------------------------------------

                                                                           $1,556,283                   $953,281
                        =============================================================================================
                        </TABLE>

8.    LONG-TERM         Long-term debt consists of the following:
      DEBT

<TABLE>
<CAPTION>
                        April 30,                                                 2001                      2000
                        =============================================================================================
<S>                                                                        <C>                        <C>
                        Revolving line of credit (a)                       $   356,200                $1,139,944

                        Term loan (a)                                               --                   128,375

                        Notes payable (b)                                    1,000,000                 1,000,000

                        Capital lease obligations (c)                            1,519                    14,824

                        7.5% convertible debentures, due
                            April 2003 (d)                                     732,643                   767,602


                        Less current portion of notes
                            payable                                         (1,000,000)               (1,000,000)

                        Less current portion of revolving
                            line of credit and term loan                      (356,200)               (1,268,319)

                        Less current portion of capital lease
                            obligations                                         (1,519)                  (11,281)
                        ---------------------------------------------------------------------------------------------

                                                                           $   732,643              $    771,145
                        =============================================================================================
</TABLE>


                                                                              20
<PAGE>   48
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                 (a)    In connection with the acquisition of Cronus, the
                        Company assumed liabilities under a revolving line of
                        credit and term loan agreement with LaSalle National
                        Bank. Under the revolving line of credit the Company
                        could borrow up to the lesser of $3,000,000 or 80% of
                        eligible accounts receivable and 35% of eligible
                        inventory, as defined in the agreement. The revolving
                        line of credit bore interest at the bank's prime rate of
                        interest plus 1.0% and was scheduled to mature on May 1,
                        2001. Under the agreement, Cronus could issue letters of
                        credit up to $250,000 in the aggregate. The term loan
                        was payable in equal monthly principle payments of
                        $9,875, bears interest at the bank's prime rate of
                        interest plus 1.0% and was scheduled to mature on May 1,
                        2001. In April 2000, the Company placed $250,000 in
                        escrow to further collateralize the revolving line of
                        credit and term loan. In July 2000, the bank informed
                        the Company that the revolving line of credit and term
                        loan would mature on September 30, 2000. On September
                        12, 2000, the bank agreed to a further extension until
                        December 31, 2000. In February 2001, the Company
                        executed an accounts receivable financing agreement with
                        Alliance Financial Capital, Inc. that replaced the
                        revolving line of credit and term loan agreement with
                        LaSalle National Bank. All debt associated with the
                        LaSalle agreement was repaid. Under the new accounts
                        receivable financing agreement, the Company can borrow
                        up to the lesser of $3,000,000 or up to 85% of eligible
                        accounts receivable, as defined in the agreement.
                        Amounts outstanding under the accounts receivable
                        financing agreement bear interest at the prime rate plus
                        1.0% plus an additional 1.5% per invoice funded. The
                        initial term of this agreement is for twelve months with
                        a minimum average daily account balance of $750,000.

                        Average short-term borrowings and the related interest
                        are as follows:

 <TABLE>
 <CAPTION>

                        Year Ended April 30,                                  2001
                        ==================================================================
<S>                                                                      <C>
                        Borrowings under accounts
                           receivable financing agreement                 $  356,200
                        Weighted average interest rate                        10.25%
                        Maximum month-end balance during
                            the year                                      $1,212,357
                        Average month-end balance during
                            the year                                      $  832,502
                        -------------------------------------------------------------------
</TABLE>


                                                                              21
<PAGE>   49

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                 (b)    In connection with the acquisition of Cronus, the
                        Company assumed $1,000,000 in debt to two individuals,
                        which is subordinated in priority and payment to all
                        senior debt referenced above. This debt matured on
                        December 10, 2000. The Company is currently in default
                        on the repayment of this debt and the individuals filed
                        a lawsuit against the Company to force repayment. The
                        Company has indicated its inability to repay the
                        debt (see Note 13).

                 (c)    In connection with the acquisition of Cronus, the
                        Company assumed liabilities for capital lease
                        obligations (c) related to various office equipment.



                        As of April 30, 2001, future net minimum lease payments
                        under capital leases are as follows:


<TABLE>
<CAPTION>
                        Year                                                            Amount
                        ---------------------------------------------------------------------------
<S>                                                                                  <C>
                        2002                                                            $1,581
                        ---------------------------------------------------------------------------

                        Less: amount representing interest                                  62
                        ---------------------------------------------------------------------------

                        Current portion capital lease obligation                        $1,519
                        ===========================================================================
</TABLE>



                                                                              22
<PAGE>   50

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        The net book value of assets under capital leases was
                        approximately $21,788 and $23,000 at April 30, 2001 and
                        2000, respectively.

                 (d)    In April 1999 the Company issued $2,490,357 in
                        convertible debentures in satisfaction of the remaining
                        75% of each claim allowed in its plan of reorganization
                        (see Note 2). The debentures earn interest at a rate of
                        7.5% payable in the form of common stock of the Company
                        at time of conversion. The debentures are convertible at
                        the average of the closing price of the Company's common
                        stock for the ten consecutive trading days ending on the
                        trading day immediately preceeding the date of
                        conversion. No conversions were permitted prior to April
                        6, 2000. The Company may prepay the debentures at any
                        time. Each debentureholder has the additional right, but
                        not the obligation, to surrender the entire debenture to
                        the Company on April 12, 2000 and receive a cash
                        distribution equal to 15% of the holder's original
                        allowed claim together with accumulated interest under
                        the plan of reorganization. The debentures mature on
                        April 12, 2003. Any debentures which have not been
                        converted by this date will automatically be converted
                        into common shares of the Company. During 2001 and 2000,
                        holders of the debentures converted $39,620 and
                        $1,825,552 of debentures and accrued interest into
                        43,465 and 513,249 shares of common stock, respectively.

                                                                              23
<PAGE>   51

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                 (e)    In April 1997, the Company issued $3,000,000 in 5.0%
                        convertible debentures due April 2001. In May 1997, the
                        Company issued $2,000,000 in 5% convertible debentures
                        due May 2001. For the first 180 days following the
                        issuance, the debentures were convertible at the option
                        of the holder into common stock at a conversion price
                        equal to the average closing bid prices on NASDAQ for
                        the ten trading days prior to conversion. If the
                        conversion occurs more than 180 days after the issuance,
                        the conversion price is the lesser of 125% of the
                        average closing bid prices on NASDAQ for the ten trading
                        days prior to the issuance date, or, 90% of the average
                        closing bid prices on NASDAQ for the ten trading days
                        prior to the conversion date. In addition, if the
                        conversion occurs more than 180 days after the issuance,
                        the holder will receive one warrant for every five
                        shares of common stock received upon conversion of the
                        debentures. If the conversion occurs more than 360 days
                        from the issuance, the holder will receive one warrant
                        for every 2 1/2 common shares received upon conversion
                        of the debentures. Each warrant will have a strike price
                        set at 125% of the market price of the Company's common
                        stock at the time of conversion. During 2000 and 1999,
                        holders of the debentures converted $224,684 and
                        $1,073,310 of debentures and accrued interest into
                        274,911 and 1,652,717 shares of common stock,
                        respectively. All of the debentures were converted as of
                        April 30, 2000.


9.    STOCKHOLDERS'     In March 2001, the Company issued 2,035,734 shares of
      EQUITY            common stock under the terms and conditions of the
                        purchase and debt agreements related to the acquisition
                        of Cronus Technology, Inc in March 2000 (see Note 3).


                        In February 2001, the Company sold 850 units at $1,000
                        per unit to a group of accredited invertors. Each unit
                        consists of a prepaid common stock purchase warrant
                        ("Prepaid Warrant") and an incentive warrant ("Incentive
                        Warrant") to acquire additional shares of common stock
                        of the Company. The Prepaid Warrant is convertible at
                        the option of the holder into common stock at a
                        conversion price equal to the lesser of $.85 or the
                        average of the five lowest closing bid prices for the
                        ten trading day period prior to conversion. The prepaid
                        warrant earns interest at a rate of 6%, payable in
                        common stock. The Incentive Warrants have a five-year
                        term and are exercisable immediately at $.85. The
                        Company recorded the proceeds from the issuance of the
                        Prepaid Warrants as paid in capital. The interest earned
                        on these warrants is reflected as a dividend. The
                        Company paid a placement fee of $85,000

                                                                              24
<PAGE>   52
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        plus other associated costs totaling $15,000 and issued
                        to the placement agent warrants to purchase 212,500
                        shares of stock at a price of $1.0625 per share. The
                        fees paid and the fair value of the warrants issued are
                        recorded as a reduction in paid in capital.


                        In September 2000, the Company sold 3,500 units at
                        $1,000 per unit to a group of accredited investors. Each
                        unit consists of a prepaid common stock purchase warrant
                        ("Prepaid Warrant") and an incentive warrant ("Incentive
                        Warrant") to acquire additional shares of common stock
                        of the Company. The Prepaid Warrant is convertible at
                        the option of the holder into common stock at a
                        conversion price equal to the lesser of $2.00 or the
                        average of the five lowest closing bid prices for the
                        ten trading day period prior to conversion. The prepaid
                        warrant earns interest at a rate of 4% payable in common
                        stock. The Incentive Warrants have a five-year term and
                        are exercisable immediately at $2.00. The Company
                        recorded the proceeds from the issuance of the Prepaid
                        Warrants as paid in capital. The interest earned on
                        these warrants is reflected as a dividend. The Company
                        paid a placement fee of $350,000 plus other associated
                        costs totaling $71,000 and issued to the placement
                        agent, warrants to purchase 438,000 shares of stock at a
                        price of $2.50 per share. The fee paid and the fair
                        value of the warrants issued are recorded as a reduction
                        in paid in capital

                        In July 2000, the Company raised $1,170,000 through a
                        private placement offering of securities to a group of
                        accredited investors. Warrants to purchase common stock
                        associated with this offering are exercisable for a
                        period of one year after the closing date.

                        During fiscal 2001, the Company received $353,888 on the
                        exercise of warrants, which resulted in the Company
                        issuing 256,729 shares of common stock. As of April 30,
                        2001, the Company has outstanding 5,089,441 warrants to
                        purchase Common Stock of the Company at exercise prices
                        ranging from $0.41 to $7.50. The warrants expire
                        principally in 2003.

                        During fiscal 2001, the Company issued 43,465 shares of
                        common Stock on the conversion of debentures and accrued
                        interest totaling $39,620.


                        In April 2000, the Company issued 728,063 shares of
                        common stock in

                                                                              25
<PAGE>   53

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        settlement of $5,314,862 in liabilities assumed as part
                        of the acquisition of Cronus (see Note 3).

                        In January 2000, the Company executed an agreement with
                        an investment banking firm to provide investment banking
                        and advisory services through August 31, 2001. As
                        consideration for these services the Company issued
                        200,000 warrants to purchase the Company's common stock
                        at an exercise price of $7.50 per share. The warrants
                        are exercisable at any time from February 1, 2000 to
                        January 31, 2003. The warrants have been valued at
                        $570,817 using the Black-Scholes option pricing model.
                        The Company has recorded the value of these warrants as
                        deferred investment advisory fees and is amortizing the
                        value over the term of the agreement.

                        In July 1999, the Company issued 1,110,040 shares of
                        common stock for $1,086,723 through a private placement
                        offering of securities to a group of accredited
                        investors.

                        During fiscal 2000, the Company received $4,392,184 in
                        proceeds on the exercise of warrants, which resulted in
                        the Company issuing 3,682,009 shares of common stock. As
                        of April 30, 2000, the Company has outstanding 2,662,106
                        warrants to purchase common stock of the Company at
                        exercise prices ranging from $1.87 to $7.50. The
                        warrants expire principally in 2003.

                        During fiscal 2000, the Company issued 788,160 shares of
                        common stock on the conversion of debentures and accrued
                        interest totaling $2,050,236.

                        In April 1999, the Company issued 1,333,333 shares of
                        common stock for $1,000,000 though a private placement
                        offering of securities to a group of Company employees,
                        insiders and accredited investors. These proceeds,
                        except for the $71,723 ($152,367 in 1999) placed in
                        escrow, funded the 25% cash payment to the unsecured
                        creditors as per the plan of reorganization.

                                                                              26
<PAGE>   54

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        Exercise prices for warrants outstanding as of April 30,
                        2001 are as follows:

<TABLE>
<CAPTION>
                                                                   Number             Weighted
                                                                Outstanding            Average                   Weighted
                         Range of                                  as of              Remaining                   Average
                         Exercise                                 April 30              Life                     Exercise
                         Prices                                     2001               (years)                      Price
                        ----------------------------------------------------------------------------------------------------

<S>                                                             <C>                   <C>                       <C>
                         $  0.41  to  $  0.52                       165,737               2.1                       $0.41
                         $  0.77  to  $  1.00                     1,270,372               4.1                       $0.81
                         $  1.50  to  $  1.87                       797,022               1.0                       $1.55
                         $  2.25  to  $  2.93                     2,564,110               2.9                       $2.49
                         $  3.48  to  $  4.75                        76,653               1.8                       $4.00
                         $  6.77  to  $  7.30                       310,509               1.5                       $7.09
                        ----------------------------------------------------------------------------------------------------

                         Total                                    5,184,403
                        ====================================================================================================
</TABLE>

10.   STOCK OPTIONS     The Company has both a qualified and non-qualified stock
                        option plan (the "Plans") under which options to
                        purchase up to 2,260,000 shares of common stock may be
                        granted to officers, directors and other key employees
                        of the Company.

                        The exercise price of each option may not be less than
                        100% of the fair market value of the stock on the date
                        of grant for incentive stock options or 85% of such fair
                        market value for non-qualified stock options, as
                        determined by the Board. Generally, options vest over a
                        three year period and expire five years from the date of
                        grant and, in most cases, upon termination of
                        employment. The following table relates to options
                        outstanding, granted, exercised, and canceled during
                        2001, 2000 and 1999, under the Plan:

                                                                              27
<PAGE>   55
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

<TABLE>
<CAPTION>
                                                                                             Option
                                                                         Number               Price
                        Options                                       of Shares          Per Shares
                        ---------------------------------------------------------------------------

<S>                                                                  <C>          <C>
                        Outstanding at
                            April 30, 1999                            1,765,992   $  0.25 to 15.63
                            April 30, 2000                            2,975,501   $  0.25 to 15.63
                            April 30, 2001                            3,783,765   $  0.25 to 15.63

                        Granted
                            During 1999                                 866,138   $  0.25 to  1.35
                            During 2000                               1,957,954   $  0.40 to  3.97
                            During 2001                               1,186,305   $  0.51 to  3.50

                        Exercised
                            During 1999                                      --                 --
                            During 2000                                 182,238   $  0.29 to  5.88
                            During 2001                                  82,161   $  0.46 to  2.50

                        Canceled
                            During 1999                                 461,057   $  0.29 to 12.00
                            During 2000                                 566,207   $  0.29 to  7.75
                            During 2001                                 295,880   $  0.46 to  3.97
</TABLE>


                        A summary of stock options outstanding and exercisable
                        as of April 30, 2001 is as follows:
<TABLE>
<CAPTION>
                                               Options Outstanding                                   Options Exercisable
                        --------------------------------------------------------------------- -------------------------------------

                                                                    Weighted         Weighted                          Weighted
                         Range of                                    Average          Average                           Average
                         Exercise                     Number       Remaining         Exercise           Number         Exercise
                         Prices                  Outstanding    Life (years)            Price      Exercisable            Price
                        -----------------------------------------------------------------------------------------------------------

<S>                                               <C>             <C>           <C>                 <C>             <C>
                         $  0.25 to $  0.25           25,000          2.6           $  0.25             16,667          $  0.25
                         $  0.46 to $  0.51        2,696,616          3.5           $  0.51            789,947          $  0.50
                         $  0.69 to $  0.90          170,954          3.4           $  0.74             77,398          $  0.75
                         $  0.92 to $  1.38          241,508          3.3           $  1.11            120,894          $  1.12
                         $  2.06 to $  2.59          351,777          1.9           $  2.45            298,222          $  2.52
                         $  2.75 to $  3.97          249,750          4.0           $  3.53             80,750          $  3.63
                         $  5.00 to $  6.82           33,160          0.2           $  5.63             33,160          $  5.63
                         $ 12.00 to $ 12.00           15,000          0.2           $ 12.00             15,000          $ 12.00
                        -----------------------------------------------------------------------------------------------------------
</TABLE>


                                                                              28
<PAGE>   56
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        The Company has adopted the disclosure-only provisions
                        of SFAS-No. 123 "Accounting for Stock Based
                        Compensation", but applies Accounting Principles Board
                        Opinion No. 25 and related interpretations in accounting
                        for its stock option plans. For SFAS No. 123 purposes,
                        the weighted average fair value of each option grant has
                        been estimated as of the date of grant using the
                        Black-Scholes option pricing model with the following
                        weighted average assumptions: risk-free interest rate of
                        6.13%, 5.96% and 5.53% and expected volatility of 110%,
                        125.0% and 60.0% and expected option life of 5, 4 and 5
                        years for the years ended April 30, 2001, 2000 and 1999,
                        respectively, and dividend payout rate of zero for each
                        year Using these assumptions, the weighted average fair
                        value of the stock options granted is $1.83, $1.41 and
                        $0.38 for 2001, 2000 and 1999, respectively. There were
                        no adjustments made in calculating the fair value to
                        account for vesting provisions or for
                        non-transferability or risk of forfeiture.

                        If the Company had elected to recognize compensation
                        cost based on the fair value at the grant dates for
                        options issued under the plans described above,
                        consistent with the method prescribed by SFAS No. 123,
                        net loss applicable to common shareholders and loss per
                        share would have been changed to the pro forma amounts
                        indicated below:

<TABLE>
<CAPTION>
                        Year ended April 30,
                        (in thousands, except per share data)               2001               2000               1999
                        --------------------------------------------------------------------------------------------------
<S>                                                                      <C>                 <C>                <C>
                        Net loss applicable to common
                            shareholders:   as reported                  $(12,815)           $(6,817)           $(5,550)
                                            pro forma                     (14,569)            (8,462)            (6,222)

                        Diluted loss per
                            share:          as reported                    $(0.48)           $ (0.35)           $ (0.43)
                                            pro forma                       (0.55)             (0.44)             (0.48)
                        ==================================================================================================
</TABLE>

                                                                              29
<PAGE>   57

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        As part of a program to retain its employees, the
                        Company adopted a program to re-price the options of its
                        current employees in March 2001. The Company also
                        re-priced the options issued to its board of directors
                        and to its chairman of the board. Under the program, the
                        exercise price of current stock options was changed to
                        $0.51 per share. Although each employee could elect not
                        to participate in the program, approximately 2.5 million
                        options were changed to the lower exercise price. Under
                        applicable accounting rules, the Company will have to
                        account for future variations in the price of its common
                        stock above $0.51 per share as compensation expense
                        until the re-priced options are either exercised,
                        cancelled or expire. This calculation will be made each
                        quarter based upon the performance of the Company's
                        common stock in that quarter. Accordingly, operating
                        results and earning per share will be subjected to
                        potentially significant fluctuations based upon changes
                        in the market price of our common stock. For the year
                        ended April 30, 2001, operating results and earnings per
                        share were not impacted by the repricing because the
                        price of the common stock at April 30, 2001 was below
                        $0.51 per share.

11. INCOME TAXES        The Company has net operating loss carryforwards for
                        income tax reporting purposes of approximately
                        $34,846,000, which begin to expire in 2008. The amount
                        of the net operating loss carryforward related to the
                        compensation element of stock options is approximately
                        $10,456,000, which when realized will be a credit to
                        paid in capital. In addition, the Company has research
                        and development credit carryforwards of approximately
                        $1,115,000, which begin to expire in 2006.

                        The difference between the Federal tax rate and the
                        effective tax rate realized as a percent of pretax
                        earnings for the years ended April 30, 2001, 2000, and
                        1999, is as follows:

<TABLE>
<CAPTION>

                                                             2001                        2000                     1999
                                                     AMOUNT          RATE         Amount      Rate           Amount    Rate
                         --------------------------------------------------------------------------------------------------------
<S>                                             <C>                 <C>       <C>              <C>       <C>             <C>
                           Tax provision
                              (benefit) at
                              statutory rates   $(2,958,000)        (34.0)    $(2,318,000)     (34.0)    $(1,887,000)    (34.0)

                           Valuation
                               allowance          2,958,000          34.0       2,318,000       34.0       1,887,000      34.0
                         --------------------------------------------------------------------------------------------------------

                                                $        --                   $        --                $        --
                         ========================================================================================================
</TABLE>

                                                                              30
<PAGE>   58
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        No deferred taxes have been recognized in the
                        accompanying consolidated financial statements as of
                        April 30, 2001 and 2000. The components of deferred
                        income taxes are as follows:

<TABLE>
<CAPTION>
                         April 30,                                                          2001                2000
                        =======================================================================================================
<S>                                                                               <C>                       <C>
                        DEFERRED TAX LIABILITIES
                            Accelerated depreciation                              $           --            $     126,000
                        -------------------------------------------------------------------------------------------------------

                        Total deferred tax liabilities                            $           --                  126,000
                        -------------------------------------------------------------------------------------------------------

                        DEFERRED TAX ASSETS
                            NOL carryforwards                                         14,338,000               11,591,000
                            Allowance for doubtful accounts                              560,000                  110,000
                            Inventory reserve                                            240,000                  240,000
                            Tax credits                                                  446,000                  759,000
                            Amortization of goodwill                                   1,318,000                  216,000
                            Accelerated depreciation                                      74,000                   76,000
                            Other                                                        138,000                   93,000
                        -------------------------------------------------------------------------------------------------------

                        Total deferred tax assets                                     17,114,000               13,085,000
                        -------------------------------------------------------------------------------------------------------

                        Net deferred tax assets                                       17,114,000               12,959,000
                        Less: Valuation allowance                                    (17,114,000)             (12,959,000)
                        -------------------------------------------------------------------------------------------------------

                        TOTAL                                                     $           --            $          --
                        =======================================================================================================
</TABLE>


                                                                             31
<PAGE>   59

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        Management has provided a valuation allowance for
                        deferred tax assets as of April 30, 2001, because they
                        are unable to predict when the benefit of these items
                        will be recognized in future years.


12.   SIGNIFICANT       Certain customers accounted for 10% or more of the
      CUSTOMERS AND     Company's total revenue during the years ended April 30,
      FOREIGN EXPORTS   2001, 2000 and 1998 as noted below:

<TABLE>
<CAPTION>
                                      2001                                  2000                              1999
                          CUSTOMER           % OF SALES           Customer       % of Sales        Customer         % of Sales
                        ------------------------------------------------------------------------------------------------------------

<S>                                              <C>              <C>                <C>             <C>                <C>
                              A                  14                  D               18
                              B                  11                  E               15               G                 28
                              C                  10                  F               12
                        ------------------------------------------------------------------------------------------------------------
</TABLE>

                        Sales to customers A, B, and C were $1,541,000,
                        $1,142,000 and $1,119,000 in 2001, respectively. Sales
                        to customers D, E and F were $1,162,000, $930,000 and
                        $775,000 in 2000, respectively. Sales to customer C were
                        $1,307,000 in 1999. In 2001, the Company had export
                        sales to foreign customers totaling approximately
                        $2,213,000. This constitutes 21% of total revenues. The
                        export sales were made to customers in Latin America and
                        Europe. In 1999, the Company had export sales to foreign
                        customers totaling approximately $1,800,000. This amount
                        constitutes 39% of total revenues. The export sales were
                        made to customers in Venezuela, Peru and Brazil. There
                        were no significant export sales in 2000.

                                                                              32
<PAGE>   60

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

13.   COMMITMENTS       CONTINGENCIES
      AND
      CONTINGENCIES     In 1997, Gary H. Davison a former officer and
                        director of the Company commenced two lawsuits
                        against the Company in the Circuit Court of Fairfax,
                        Virginia, one for wrongful termination and the other
                        for breach of contract.  The breach of contract
                        action involved claims for options to purchase
                        100,000 shares of stock and a $100,000 bonus.  On
                        February 17, 1998, a jury in Fairfax County awarded
                        Mr. Davison $1,125,000 in damages and $163,233 in
                        interest accrued from May 26, 1996 in this case.
                        Accordingly, the Company recorded a loss provision
                        for this amount in its third fiscal quarter ended
                        January 31, 1998.  Subsequently, this award was
                        reduced by $100,000.  The Company filed an appeal of
                        this decision with the Virginia Supreme Court.  The
                        Company settled these lawsuits  for $900,000 as part
                        of its plan of reorganization (see Note 2).

                        In fiscal 1995, the Securities and Exchange Commission
                        (the "SEC") began an inquiry relating to certain prior
                        public disclosures and periodic reports of the Company.
                        In September 1999, the Company, its Chief Executive
                        Officer and Chairman of the Board and its Chief
                        Financial Officer agreed to a settlement with the SEC.
                        Without admitting or denying the allegations, the
                        Company consented to the entry of a final judgement
                        which enjoins it from violations of specific sections of
                        the Securities Exchange Act of 1934 and the involved
                        officers consented to the entry of an order to cease and
                        desist committing or causing any violations or future
                        violations of specific sections of the Securities and
                        Exchange Act of 1934.

                        A supplier of parts for the Company's integrated access
                        device product line has asserted claims for $111,000 for
                        good sold and delivered and $270,000 for goods
                        manufactured but not yet delivered. The Company is
                        actively working to settle this matter and expects to do
                        so shortly. The Company has accrued the related
                        liabilities in the accompanying balance sheet.

                        On January 29, 2001, two individuals holding
                        subordinated senior notes totaling $1,000,000 commenced
                        an action in the Circuit Court, Cook County, Illinois
                        against the Company, Cronus, certain former principal
                        shareholders of Cronus and a liquidating trust
                        established by Cronus and its trustees seeking repayment
                        of the notes, together with accrued interest. The
                        Company has filed a motion to dismiss the complaint on
                        jurisdictional grounds. On March 6, 2001, the Circuit
                        Court denied an application by the Plaintiffs seeking an
                        injunction against the Defendants and other relief. The
                        Company believes it has meritorious defenses against
                        this action.

                        Subsequent to April 30, 2001, the Company was sued in
                        Federal District Court in Illinois by Richard L.
                        Abrahams, as Trustee of the R.L.A. 1993 Trust (the
                        "Trust"). The action is for an alleged breach of a
                        contract executed by the Company and the Trust in March
                        2000 related to conversion of debt to equity in
                        connection with the Cronus acquisition. The Trust seeks
                        to force the Company to issue an additional 628, 000
                        common shares which it contends are due under the
                        assumption and conversion agreement, together with
                        unspecified damage and costs. The Company has yet to
                        answer the complaint but intends to

                                                                              33
<PAGE>   61
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        vigorously deny all allegations.

                        No other material legal proceeding to which the Company
                        is party or to which the Company is subject is pending
                        and no such proceeding is known by the Company to be
                        contemplated.

                        OPERATING LEASES

                        The Company leases office space and certain office
                        equipment under operating lease arrangements that expire
                        at various dates through 2003. The main office lease
                        provides for scheduled rent increases in the future
                        which are being amortized over the lease period. Rent
                        expense for the years ended April 30, 2001, 2000, and
                        1999, was approximately $668,000, $434,000 and $662,000,
                        respectively. Aggregate future minimum lease payments
                        under the operating leases are as follows:

<TABLE>
<CAPTION>
                        Year ended April 30,
                        -----------------------------------------------------------
<S>                                                                 <C>
                        2002                                           441,200
                        2003                                           280,023
                        2004                                             1,387
                        ===========================================================
</TABLE>


                        COMPENSATION

                        The Company maintains an employment agreement with its
                        President and Principal Executive Officer. This
                        agreement provides for a base salary of $100,000 plus
                        bonus and incentive compensation as may be deemed
                        appropriate by the Board of Directors. The agreement was
                        scheduled to expire on January 31, 2001, however, the
                        agreement was automatically renewed through January 31,
                        2002 by the Board of Directors. In connection with the
                        acquisition of KG Data, the Company entered into a three
                        year employment agreement, expiring March 31, 2002, with
                        the former President and sole stockholder of KG Data.
                        This agreement provides for a base salary of $100,000
                        plus bonus and incentive compensation as deemed
                        appropriate by the Board of Directors. The former
                        President and sole stockholder of KG Data has been
                        terminated. The Company has accrued the remaining
                        amounts due under the employment agreement. See Note 15.


                                                                              34
<PAGE>   62

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        The Company maintains a defined contribution plan that
                        covers substantially all of its employees. Employees may
                        contribute a portion of their compensation as defined
                        under the Internal Revenue Code and employer
                        contributions are discretionary. There were no employer
                        contributions in 2001, 2000 or 1999.

14.   FINANCIAL         Generally accepted accounting principles requires the
      INSTRUMENTS       disclosure of the fair value of financial instruments;
                        however, this information does not represent the
                        aggregate net fair value of the Company. Some of the
                        information used to determine fair value is subjective
                        and judgmental in nature; therefore, fair value
                        estimates, especially for less marketable securities,
                        may vary. The amounts actually realized or paid upon
                        settlement or maturity could be significantly different.

                        Unless quoted market price indicates otherwise, the fair
                        value of accounts receivable generally approximates
                        market because of the short maturity of these
                        instruments. The Company has estimated the fair value of
                        long-term debt based on quoted market prices for similar
                        debentures.

                        The estimated fair values of the Company's financial
                        instruments, none of which are held for trading
                        purposes, are summarized as follows:

<TABLE>
<CAPTION>
                          April 30,                                     2001                              2000
                        ========================================================================================================

                                                              Carrying       Estimated         Carrying         Estimated
                                                               Amount        Fair Value         Amount          Fair Value
                        --------------------------------------------------------------------------------------------------------
<S>                                                           <C>             <C>              <C>               <C>
                          Convertible debentures              $732,643        $366,000         $767,602          $615,000
                        ========================================================================================================
</TABLE>




15.   RESTRUCTURING     The Company commenced a broad restructuring aimed at
      COSTS             achieving profitability and positive cash flow in fiscal
                        2002 by reducing costs and focusing on market
                        opportunities which offer the greatest revenue
                        potential.

                        The Company closed its KG Data division and closed the
                        related Connecticut facility. The Company has reduced
                        its headcount from 103 to 63 fulltime employees and
                        consolidated its two Virginia facilities into one. As a
                        result of these and other cost saving activities,
                        quarterly operating expenses should decline by
                        approximately $1,000,000 (or approximately $4,000,000
                        annually) in fiscal 2002. One time charges associated
                        with these restructuring activities totaling $1,588,000
                        are reflected in the Company's operating results for its
                        fourth fiscal quarter

                                                                              35
<PAGE>   63
                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

                        for the year ended April 30, 2001.
                        During the fiscal year ended April 30, 2001, the Company
                        recorded $1,364,000 in costs associated with closing its
                        KG division. These costs were as follows:

<TABLE>
<S>                                                            <C>
                        Inventory writedown                     $  554,000
                        Goodwill impairment                        347,000
                        Severance                                  337,000
                        Other                                      126,000
                        -------------------------------------------------------

                        Total                                   $1,364,000
                        =======================================================
</TABLE>

                        Also during the fourth quarter, the Company recorded
                        $224,000 in costs associated with the consolidation of
                        excess operating facilities. Such costs are primarily
                        associated with a reserve for non-cancelable lease
                        costs. Remaining cash expenditures relating to work
                        force reductions and termination of employment
                        agreements will be substantially paid in the first and
                        second quarters of fiscal 2002. Amounts related to the
                        remaining lease commitments due to the consolidation of
                        facilities will be paid over the respective lease term
                        through fiscal 2003 or shorter if settled for a lower
                        amount. The Company expects to substantially complete
                        implementation of its restructuring program by the end
                        of the first quarter of fiscal 2002

                                                                              36
<PAGE>   64

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

16.   SUPPLEMENTAL      Supplemental information on interest paid is as follows:
      CASH FLOW
      INFORMATION

<TABLE>
<CAPTION>
                        For the year ended April 30,                                2001                 2000              1999
                        -------------------------------------------------------------------------------------------------------

<S>                                                                             <C>                    <C>         <C>
                        Interest                                                $159,500               $1,728      $         --
                        =======================================================================================================
</TABLE>


                        Supplemental disclosure of non-cash investing and
                        financing activities:

<TABLE>
<CAPTION>
                         For the year ended April 30,                                  2001            2000                1999
                        -------------------------------------------------------------------------------------------------------
<S>                                                                          <C>                   <C>               <C>
                        Common stock issued for
                            Cronus acquisition                               $           --        $  9,275,132      $       --
                        =======================================================================================================

                        Liabilities assumed in
                            Cronus acquisition                               $           --        $ 10,104,104      $       --
                        =======================================================================================================

                        Issuance of common stock in
                            connection with acquisition
                            of assets of KG Data                             $           --        $         --      $  845,000
                        =======================================================================================================

                        Issuance of stock for
                            convertible debentures                           $       39,620        $  2,050,236      $1,073,310
                        =======================================================================================================

                        Liabilities settled through
                            issuance of common stock                         $       80,777        $  1,863,142      $       --
                        =======================================================================================================

                        Warrants issued to nonemployees                      $           --        $    570,817      $       --
                        =======================================================================================================


                        Dividend on prepaid warrants                         $       98,417        $        --       $       --
                        =======================================================================================================

</TABLE>

                                                                              37
<PAGE>   65

                                             FASTCOMM COMMUNICATIONS CORPORATION

                                                   NOTES TO FINANCIAL STATEMENTS
================================================================================

17.   QUARTERLY         Summarized quarterly financial data for fiscal 2001 and
      FINANCIAL DATA    2000 is as follows:
      (UNAUDITED)

<TABLE>
<CAPTION>
                                                                                     Quarter
                                                                ------------------------------------------------

           2001                                         First                Second                  Third                 Fourth
           =========================================================================================================================
<S>                                                <C>                   <C>                    <C>                    <C>
           Net sales                               $3,647,933            $4,200,675             $1,842,651             $1,226,784
           Gross profit                             2,247,750             2,737,512                953,448                181,643
           Net loss                                (1,848,288)           (1,494,009)            (3,341,853)            (6,130,363)
           Basic and diluted loss per share             (0.07)                (0.06)                 (0.13)                 (0.22)

</TABLE>

<TABLE>
<CAPTION>
                                                                                     Quarter
                                                                ------------------------------------------------

           2000                                         First                Second                  Third                 Fourth
           =========================================================================================================================
<S>                                                <C>                   <C>                    <C>                    <C>
           Net sales                               $1,747,457            $1,568,651             $1,175,418             $1,923,391
           Gross profit                               967,782               731,579                500,041                141,457
           Net loss                                  (776,538)           (1,253,712)            (1,437,826)            (3,348,886)
           Basic and diluted loss per share             (0.05)                (0.07)                 (0.07)                 (0.16)
</TABLE>


During the fourth quarter ended April 30, 2001, the Company recorded a provision
for doubtful accounts of $1,117,845 which had the effect of increasing the
operating loss by $1,117,845 or $0.05 per share. The Company recorded increases
in the allowance for doubtful accounts in the first three quarters based on its
best estimate of amounts collectible from customers. During the fourth quarter,
collectibility problems arose with two significant customers. The Company
revised downward its estimate of the amounts it could collect and, accordingly,
increased the allowance for doubtful accounts.




                                                                              38
<PAGE>   66





REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
ON FINANCIAL STATEMENT SCHEDULE

FASTCOMM COMMUNICATIONS CORPORATION

The audits referred to in our report, which includes an explanatory paragraph
related to substantial doubt about the Company's ability to continue as a going
concern, to FastComm Communications Corporation, dated July 14, 2001 which is
contained in Item 8 of this Form 10-K, included the audit of the financial
statement schedule listed in the accompanying index for each of the three years
in the period ended April 30, 2001. This financial statement schedule is the
responsibility of the Company's management. Our responsibility is to express an
opinion on the financial statement schedule based upon our audits.

In our opinion, such schedule presents fairly, in all material respects, the
information set forth therein.

                                                                BDO Seidman, LLP



Washington, D.C.
July 20, 2001


                                                                              39
<PAGE>   67


                                             FASTCOMM COMMUNICATIONS CORPORATION


                                   SCHEDULE OF VALUATION AND QUALIFYING ACCOUNTS
                                                                     SCHEDULE II
================================================================================

<TABLE>
<CAPTION>
                                                              Balance   Charged to                      Balance
                                                         at Beginning    Costs and                       at End
                                                            of Period     Expenses   Deductions       of Period
----------------------------------------------------------------------------------------------------------------
<S>                                                        <C>          <C>          <C>              <C>
Year Ended April 30, 1999

   Reserves and allowances deducted from asset accounts:
         Obsolescence reserve for
            inventory                                      $1,370,000   $   80,000   $       --       $1,450,000
         Allowance for doubtful accounts                   $  300,000   $   78,792   $ (78,792)(1)    $  300,000
================================================================================================================

Year Ended April 30, 2000

   Reserves and allowances deducted from asset accounts:
         Obsolescence reserve for
            inventory                                      $1,450,000   $  815,347   $(1,665,347)(2)  $  600,000
         Allowance for doubtful accounts                   $  300,000   $    1,764   $   (26,764)(1)  $  275,000
================================================================================================================

Year Ended April 30, 2001

   Reserves and allowances deducted from asset account:
         Obsolescence reserve for
            Inventory                                      $  600,000   $  772,541   $(772,541)(2)    $  600,000
         Allowance for doubtful accounts                   $  275,000   $1,328,923   $(203,923)(1)    $1,400,000
================================================================================================================
</TABLE>

(1) Accounts written off
(2) Inventory scrapped or disposed of


                                                                              40





<PAGE>   68


ITEM 9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
          FINANCIAL DISCLOSURE


NONE.



                                       28
<PAGE>   69


                                    PART III.


ITEM 10.     DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

The following lists the directors and executive officers of the Company, their
ages, descriptions of their business experience and positions held with the
Company:

<TABLE>
<CAPTION>
        Name                         Age          Position
        ----                         ---          --------
<S>                                  <C>          <C>
        Peter C. Madsen(1) (2)       50           President, Chief Executive Officer and Chairman of the Board
        Mark H. Rafferty             46           Vice President - Finance, Treasurer, Secretary and Director
        William A. Grant             48           Executive Vice President - Global Sales
        Dr. Kenneth Bloom            52           Vice President - Mainframe Networking
        Safa Alkateb                 33           Vice President - Engineering
        Michael Harmon               38           Vice President - Business Development
        Roy Wainwright               53           Executive Vice President
        George Glass                 57           Vice President - Engineering
        Darlene Greenhaw             50           Vice President - Sales
        Edward R. Olson(1) (2)       60           Director
        F. Michael Pascoe            49           Director
        Thomas G. Amon(1) (2)        54           Director
</TABLE>

        (1) Member Stock Option Committee.
        (2) Member Audit Committee.


All directors hold office until the next annual meeting of the shareholders and
the election and qualification of their successors. The officers are elected by
and serve at the discretion of the Board of Directors. See "Employment and
Control Arrangements" under Item 11, "Executive Compensation."

PETER C. MADSEN has been President, Chief Executive Officer and a director of
the Company since September 1992. From November 1986 to January 1992, he was an
officer of the Newbridge Networks Corporation, a Canadian telecommunications
company, most recently as Vice President and General Manager, United States
Region, and President of Newbridge Networks Inc., Newbridge Networks
Corporation's United States subsidiary. Mr. Madsen served as a director of
Newbridge Networks Corporation from September 1987 until June 1998.

MARK H. RAFFERTY has been Vice President, Chief Financial Officer and Treasurer
of the Company since August 1993 and a director of the Company since March 1998.
From August 1992 to August 1993, Mr. Rafferty was Vice President, Finance at
Newbridge Networks Inc. From August 1987 through August 1992, Mr. Rafferty was
Controller of Newbridge Networks Inc.

WILLIAM A. GRANT was Executive Vice President - Global Sales for the Company
from November, 1997 to January, 2001. From October 1996 through October 1997,
Mr. Grant served as Vice President - Global Sales for Memotec Communications
Corporation. From January 1994 through September 1996, Mr. Grant was Vice
President - Business Development for FastComm. Prior to this time, Mr. Grant was
President of Inteletouch Corporation, a telecommunications equipment company.
Mr. Grant left the Company effective January 12, 2001.

DR. KENNETH A. BLOOM has served as Vice President - Mainframe Networking since
March 1999. For five years prior to this time, Dr. Bloom was President and sole
stockholder of KG Data Systems, Inc., which was acquired by the Company in March
1999.

SAFA ALKATEB was Vice President - Engineering for the Company from February 1999
to December 2000. From April 1994 to January 1999, Mr. Alkateb held a variety of
engineering positions within the Company. From October 1992 to March 1994, Mr.
Alkateb was Product Development Senior Software Engineer for Novak Engineering
Company, an engineering consulting firm. Mr. Alkateb left the Company effective
December 15, 2000.


                                       29
<PAGE>   70

MICHAEL L. HARMON has been Vice President - Business Development for the Company
since November 2000. From 1989 through 2000, Mr. Harmon held various software
and business development positions at Bechtel Corporation.

ROY WAINWRIGHT was Executive Vice President of the Company from April 2000 to
November 2000. From March 1997 to March 2000, Mr. Wainwright was Vice President/
General Manager of Cronus Communications Inc. From June 1995 to March 1997,
Mr. Wainwright was Associate Vice President - Product Marketing at Computer
Sciences Corporation. Mr. Wainwright left the Company effective November 15,
2000.

GEORGE GLASS has been Vice President - Engineering of the Company since December
2000. For the five preceding years, Mr. Glass was Vice President - Engineering
and Operations Manager of Cronus Technology, Inc. and its predecessor company,
Anadigicom.

DARLENE GREENHAW has been Vice President - Sales for the Company since April 3,
2000. From October 1999 to March 2000, Ms. Greenhaw was Vice President - Sales
at Cronus Communications Inc. From September 1987 to September 1999, Ms.
Greenhaw was Vice President - Sales at Newbridge Networks Inc.

EDWARD R. OLSON has served as a director since January 1989. Mr. Olson has
served as President and Chief Executive Officer of Woods Equipment Company since
February 2001 and as Chairman since November 2000. Mr. Olson has also served as
President and Chief Executive Officer of Ed Olson Consulting Group, Ltd. since
1993. Additionally, he has served as Principal of Dominion Management LLC and
its predecessor KPMG Baymark Strategies LLC since 1995. Mr. Olson was President
and Chief Operating Officer of Porta Systems Corporation from 1995 to 1997 and
President and Chairman of M-C Industries from 1990 to 1997. Mr. Olson is a
director of Dynamic Metal Forming, Inc. and S&L Metal Products Corporation.

F. MICHAEL PASCOE has served as a director since August 2000. From December 1999
to June 2000, Mr. Pascoe was President and CEO of Pairgain Technologies, a DSL
company. From 1986 to 1999, Mr. Pascoe held various senior management positions
at Newbridge Networks Corporation, a Canadian telecommunications equipment
manufacturer. Mr. Pascoe serves as a director of Anda Networks and Mariner
Networks.

THOMAS G. AMON has served as a director since December 1994. For the past five
years, Mr. Amon has been an attorney in private practice in New York City. Since
June 1, 1999, Mr. Amon has been a partner in the law firm of Sokolow, Dunaud,
Mercadier & Carreras, LLP located in New York, NY and Paris, France.

In September 1999, the Company's Chief Executive Officer and its Chief Financial
Officer agreed to a settlement with the SEC. Without admitting or denying the
allegations, the Company's Chief Executive Officer and its Chief Financial
Officer each agreed to consent to the entry of an Order to cease and desist
committing or causing any violations or any future violations of Sections 13(a),
13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 12b-20 and 13a-13
promulgated thereunder. The Company's Chief Financial Officer also agreed to
cease and desist from committing or causing any violations or any future
violations of Rule 13a-1 promulgated under the Exchange Act.

On June 2, 1998, the Company filed a voluntary petition for reorganization under
Chapter 11 of the federal bankruptcy laws in the United States Bankruptcy Court
for the Eastern District of Virginia. On March 30, 1999, the Company's Plan of
Reorganization was approved by the Bankruptcy Court and the Company emerged from
Chapter 11. On November 18, 1999, a motion for final decree was granted and the
case was closed.

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES  EXCHANGE ACT OF 1934

Section 16(a) of the Securities Exchange Act of 1934 requires the Company's
officers and directors, and persons who own more than ten percent of a
registered class of the Company's equity securities, to file reports of
ownership and changes in ownership with the Securities and Exchange Commission
and with the National Association of Securities Dealers, Inc. Automated
Quotations (NASDAQ) system. Officers, directors and greater than ten percent
shareholders are required by regulation to furnish the Company with copies of
all Section 16(a) forms they file.

Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons that no Forms 5 were
required for those persons, the Company believes that during its fiscal year
ended April 30, 2001, all filing requirements applicable to its officers,
directors and greater than 10% beneficial owners were complied with.



                                       30
<PAGE>   71




ITEM 11.     EXECUTIVE COMPENSATION

SUMMARY COMPENSATION TABLE

The following table sets forth information regarding compensation paid by the
Company to the five named executives (the "Named Executive Officers") for
services furnished in all capacities to the Company during the fiscal year ended
April 30, 2001, as well as such compensation paid by the Company to the Named
Executive Officers during the Company's two previous fiscal years


<Table>
<Caption>

                                                                                                          LONG TERM
                                                                                                        COMPENSATION
                                                            ANNUAL COMPENSATION                            AWARDS
                                           --------------------------------------------------------     ------------
                                                                                                          SHARES OF
                                                                                       OTHER ANNUAL     COMMON STOCK
                                                                                       COMPENSATION      UNDERLYING
NAME AND PRINCIPAL POSITION                  YEAR       SALARY ($)        BONUS ($)       ($) (1)          OPTIONS
--------------------------------------------------------------------------------------------------------------------
<S>                                          <C>           <C>            <C>           <C>               <C>
Peter C. Madsen (2)                          2001          100,000            -           7,600            250,000
  President, CEO and Chairman                2000          100,000            -           7,600            200,000
  of the Board of Directors                  1999           96,154            -           7,320             20,000

Mark H. Rafferty (3)                         2001          130,000            -           7,600            150,000
  Vice President and                         2000          130,000            -           7,300            233,334
  Chief Financial Officer                    1999          125,000            -           8,075             20,000

William A. Grant (4)                         2001          147,044            -           4,500             15,000
  Executive Vice President-                  2000          175,000            -           6,000             65,000
  Global Sales                               1999          167,983            -           6,000             35,000

Darlene Greenhaw                             2001          162,500            -             -                  -
  Vice President - Sales                     2000            9,375            -             -               80,000

George Glass (5)
  Vice President - Engineering               2001          137,333            -             -                3,000

</Table>





1)  Automobile benefit.

2)  At April 30, 2001, Mr. Madsen held 1,760,510 restricted shares of Common
    Stock with a market value of $510,548 at that date.

3)  At April 30, 2001, Mr. Rafferty held 13,420 restricted shares of Common
    Stock with a market value of $3,892 at that date.

4)  At April 30, 2001, Mr. Grant held 36,667 restricted shares of  Common Stock
    with a market value of $10,633 at that date.  Mr. Grant left the Company
    effective January 15, 2001.

5)  At April 30, 2001, Mr. Glass held 8,632 restricted shares of Common Stock
    with a market value of $2,503 at that date.


                                       31

<PAGE>   72



FISCAL 2001OPTION GRANTS

The following table sets forth information concerning grants of stock options
to the Named Executive Officers made pursuant to the Company's 1999 Stock
Option Plan during the fiscal year ended April 30, 2001:

                     Stock Option Grants in Fiscal Year 2001

                                INDIVIDUAL GRANTS



The exercise price of each option may not be less than 100% of the fair market
value of the stock on the date of the grant for incentive options or 85% of such
fair market value for non-qualified stock options, as determined by the Board of
Directors. The vesting period is determined by the Board of Directors. Options
expire five years from the date of grant and, in most cases, upon termination of
employment.


<Table>
<Caption>


                         Securities        Percent of                                          Potential Realizable Value
                         Underlying       Total Options        Exercise                          at Assumed Annual Rates
                           Options         Granted to             or                          of Stock Price Appreciation
                           Granted        Employees in        Base Price     Expiration             For Option Term
Name                         (#)           Fiscal Year          ($/sh)          Date             5% ($)          10% ($)
----                         ---           -----------          ------          ----             ------          -------
<S>                        <C>               <C>                <C>           <C>              <C>               <C>
Peter C. Madsen            250,000           21.07%              $0.51        6/2/2005         $35,250           $77,750

Mark H. Rafferty           150,000           12.64%              $0.51        6/2/2005         $21,150           $46,650

George Glass                 3,000             0.3%              $0.51        12/11/05            $423              $933

William A. Grant            15,000            1.26%              $2.06        8/2/2004          $8,535           $18,870
</Table>



As part of a program to retain its employees, the Company adopted a program to
re-price the options of its current employees. The Company also re-priced the
options issued to its board of directors and to its chairman of the board. Under
the program, the exercise price of current stock options was changed to $0.51
per share. Although each employee could elect not to participate in this
program, the exercise price of approximately 2.5 million options was changed to
the lower price. Under applicable accounting rules, the Company will have to
account for future variations in the price of its common stock above $0.51 per
share as compensation expense until the repriced options are either exercised,
cancelled or expire. This calculation will be made each quarter based upon the
performance of the Company's common stock in that quarter. Accordingly,
operating results and earnings per share will be subjected to potentially
significant fluctuations based upon changes in the market price of the Company's
common stock.


                                       32

<PAGE>   73



FISCAL 2001 AGGREGATE OPTION EXERCISES AND YEAR-END OPTION VALUES

The following table sets forth information concerning each exercise of stock
options during the fiscal year ended April 30, 2001 by each of the Named
Executive Officers and the fiscal year-end value of unexercised options held by
such persons:


<Table>
<Caption>
                                                                        Shares               Value of
                                                                      Underlying            Unexercised
                                                                      Unexercised          in-the-money
                                                                      Options at            Options at
                                                                     Fiscal Year-          Fiscal Year-
                               Shares            Value                  End (#)               End ($)
                             Aquired on         Realized             Exercisable/          Exercisable/
Name                         Exercise (#)         ($)                Unexercisable         Unexercisable
----                                            <C>             <C>           <C>        <C>         <C>
<S>                             <C>
Peter C. Madsen                 13,333           4,133          450,000        6,667     $0          $0

Mark H. Rafferty                   -               -            366,111       62,223     $0          $0

Darlene Greenhaw                   -               -             40,000       40,000     $0          $0

William A. Grant                11,000          17,972          192,333       11,667     $0          $0

George Glass                       -               -              5,333       13,667     $0          $0

</Table>




BOARD REPORT ON EXECUTIVE COMPENSATION

The Company does not have a formal compensation committee. Compensation levels
for executive officers are approved by the Board of Directors. The Board of
Directors is presently comprised of the following individuals: Peter C. Madsen,
Thomas G. Amon, Edward R. Olson, F. Michael Pascoe and Mark H. Rafferty.
Salaries are reviewed periodically and are based on individual performance, the
extent of individual experience and responsibility and comparisons with salaries
paid in the industry.

The Company recruits for its executive officer positions from within the
communications industry. In most instances, the source company is significantly
larger than the Company. It has been the policy of the Board of Directors of
FastComm to hire executive officers at levels below that of their current
salaries along with a stock option package intended to make up for the
differentiation and to provide a performance incentive. The Company believes
that stock options are an attractive benefit in that they enhance performance
and loyalty at little cost. The Company believes the compensation packages
offered to its current employees and prospective employees have been consistent
with that of the communications industry.

The Board granted six executive officers options during fiscal 2001. Five of
these grants were determined by the individuals performance, responsibility and
seniority. The remaining grant was a condition of employment.

The Board adheres to a policy of granting options to executive officers based
upon performance and responsibility. In addition, the Board also considers the
relative importance of the job function being performed and the number of
options currently held by the executive officer, and options granted for
comparable positions in peer group companies.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

During the year, Peter C. Madsen, Edward R. Olson, Thomas G. Amon, F. Michael
Pascoe and Mark H. Rafferty as directors participated in deliberations of the
Company's Board of Directors concerning executive officer



                                       33

<PAGE>   74

compensation and stock option grants, including their own. None of such
directors was party to any reportable interlock or participation during fiscal
2001.

EMPLOYMENT AND CONTROL ARRANGEMENTS

Pursuant to the Employment Agreement dated September 18, 1992, Mr. Madsen was
elected President and Chief Executive Officer of the Company at an annual base
salary of $100,000 per year. Under this agreement, Mr. Madsen has been granted
full control of and authority over the operations of the Company, subject to the
general oversight of the Board of Directors. This agreement, which currently
expires on January 31, 2002, is renewable thereafter on a year to year basis.

In connection with the acquisition of KG Data, the Company entered into a three
year Employment and Non Competition Agreement on March 31, 1999 with Dr. Kenneth
A. Bloom. The Agreement provides that Dr. Bloom be employed by the Company in a
senior management capacity at an annual salary of $100,000 plus incentives.

DIRECTOR COMPENSATION

Directors receive no cash compensation for their services as such, however, the
Board of Directors has authorized payment of reasonable expenses incurred by
non-employee directors in connection with attendance at meetings of the Board of
Directors. Further, members of the Company's Board of Directors are granted
options to purchase shares of common stock of the Company pursuant to the
Company's 1999 Stock Option Plan. During fiscal year 2001, the Company granted
options to purchase 30,000 shares of its common stock of the Company to both
Edward R. Olson and Thomas G. Amon and 50,000 options to F. Michael Pascoe. Also
during fiscal year 2001, the Board granted Mr. Amon options to purchase an
additional 50,000 shares of common stock of the Company for his professional
assistance in the acquisition of Cronus. The Chairman of the Board receives no
compensation for serving in such capacity.

ITEM 12.     SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

At July 20, 2001, there were 29,066,624 shares of common stock of the Company
issued and outstanding. As of such date, options to purchase 3,783,765 shares of
common stock were outstanding.

Each holder of shares of common stock of the Company, but not holders of
unexercised options, is entitled to one vote per share on each matter, which may
be presented at a meeting of shareholders. Cumulative voting is not allowed. The
Company's shares of common stock are quoted on the OTC Bulletin Board under the
symbol FSCX. OB.

The following table sets forth information regarding ownership of shares of
common stock of the Company at July 20, 2001, by each person who is known by
management of the Company to own beneficially more than five percent of the
common stock of the Company(setting forth the address of each such person), by
each Director, by the Named Executive Officers of the Company identified in
"Item 11. Executive Compensation," and by all Directors and Named Executive
Officers of the Company as a group. Shares issuable on exercise of options
exercisable within 60 days of July 20, 2001 are deemed to be outstanding for the
purpose of computing the percentage ownership of persons beneficially owning
such warrants or options, but have not been deemed to be outstanding for the
purpose of computing the percentage ownership of any other person. Except as
otherwise indicated, the persons indicated below have sole voting and investment
power with respect to the shares indicated as owned by them except as otherwise
stated in the notes to the table.


                                       34
<PAGE>   75


<Table>
<Caption>
                                                   Amount and Nature
Name and address of Beneficial Owner            of Beneficial Ownership         Percent of Class
------------------------------------            -----------------------         ----------------
<S>                                                    <C>                           <C>
Peter C. Madsen (1)                                     2,210,510 (2)                 7.49%
  Sterling, Virginia

Edward R. Olson (1)                                        80,000 (3)                 0.27%
  Reston, Virginia

Thomas G. Amon (1)                                        148,854 (4)                 0.51%
  New York, New York

Mark H. Rafferty (1)                                      379,531 (5)                 1.29%
  Centreville, Virginia

William A. Grant                                          234,000 (6)                 0.80%
  Ashburn, Virginia

Roy Wainwright                                            212,198 (7)                 0.73%
  Fairfax, Virginia

Safa Alkateb                                              255,834 (8)                 0.87%
  Sterling, Virginia

Darlene Greenhaw                                           40,000 (9)                 0.14%
  Fairfax, Virginia

Michael Harmon                                             20,000 (10)                0.07%
  Damascus, Maryland

F. Michael Pascoe (1)                                      16,667 (11)                0.06%
  Toronto, Ontario, Canada

George Glass                                               13,965 (12)                0.05%
  Ashburn, Virginia

Kenneth A. Bloom                                          669,949 (13)                2.30%
  Norwalk, Connecticut


All Named Officers and Directors as as group            4,281,508                    14.57%
</Table>




1) Director

2) Gives effect to 450,000 options owned by Mr. Madsen exercisable within 60
days

3) Gives effect to 73,334 options owned by Mr. Olson exercisable within 60 days

4) Gives effect to 126,667 options owned by Mr. Amon exercisable within 60 days

5) Gives effect to 366,111 options owned by Mr. Rafferty exercisable within 60
days

6) Gives effect to 197,333 options owned by Mr. Grant exercisable within 60 days

7) Gives effect to 125,000 options owned by Mr. Wainwright exercisable within 60
days

8) Gives effect to 253,834 options owned by Mr. Alkatebexercisable within 60
days

9) Gives effect to 40,000 options owned by Ms. Greenhaw exercisable within 60
days

10) Gives effect to 20,000 options owned by Mr. Harmon exercisable within 60
days

11) Gives effect to 16,667 options owned by Mr. Pascoe exercisable within 60
days

12) Gives effect to 8,632 options owned by Mr. Glass exercisable within 60 days

13) Gives effect to 80,000 options owned by Dr. Bloom exercisable within 60 days

14) Percent of Class based upon 29,066,624 shares outstanding at July 20, 2001



                                       35

<PAGE>   76

The Company is unaware of any arrangement the operation of which could at a
subsequent date result in a change in control of the Company.



ITEM 13.     CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.


The Company paid the law firm of Sokolow, Dunaud, Mercadier and Carreras LLP
$185,000 in the fiscal year ended April 30, 2001. Thomas G. Amon, a Director of
the Company since December 1994, is a partner in this law firm.

The terms of the transactions described above were negotiated at arms length
such that the terms were as favorable to the Company as could have been obtained
from an unaffiliated third party.

The Company has entered into separate indemnification agreements with each of
its directors and executive officers that may require the Company, among other
things, to indemnify them against certain liabilities that may arise by reason
of their status or service as directors or officers.


                                       36

<PAGE>   77


                                    PART IV.


ITEM 14.     EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

          (a)(1) and (a)(2)   Financial Statements and Schedules.

The financial statements and financial statement schedules filed as a part of
this Report are listed beneath Item 8 of this Report.

          (a)(3)   Exhibits.

The exhibits filed as a part of this Report are listed on the Exhibit Index
following this Report.

          (b)       Reports on Form 8-K.

The Company filed one report on Form 8-K in the fourth quarter of its fiscal
year ended April 30, 2001 announcing the February 2001 private placement.


                                       37

<PAGE>   78


                                   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, on July 30, 2001.


                             FASTCOMM COMMUNICATIONS CORPORATION


                             By: /s/ Peter C. Madsen
                                 -------------------
                                 Peter C. Madsen
                                 President


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 in
the capacities indicated on July 30, 2001.

                             POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Peter C. Madsen and Mark H. Rafferty, his
attorney-in-fact, with the power of substitution, for him in any and all
capacities, to sign any amendments to this Report on Form 10-K, and to file the
same, with the exhibits thereto and other documents in connection therewith with
the Securities and Exchange Commission, hereby ratifying and confirming all that
said attorney- in-fact, or his substitute or substitutes may do or cause to be
done by virtue hereof.



    /s/ Peter C. Madsen                  President (Principal Executive Officer)
  ----------------------------------     and Director
              Peter C Madsen







    /s/ Mark H. Rafferty                 Vice President - Finance, Secretary,
  ----------------------------------     Treasurer and Director
             Mark H. Rafferty            (Principal Financial and Accounting
                                         Officer)



    /s/ Thomas G. Amon
  ----------------------------------
               Thomas G. Amon            Director




    /s/ Edward R. Olson
  ----------------------------------
               Edward R. Olson           Director






    /s/ F. Michael Pascoe
  ----------------------------------
               F. Michael Pascoe         Director







                                       38


<PAGE>   79





                                  EXHIBIT INDEX

<TABLE>
<CAPTION>
                                                                                     Sequential
Exhibit                                                                                 Page
No.        Description                                                                 Number
---        -----------                                                                 ------
<S>        <C>
3.1*       Amendment to Restated Articles of Incorporation

3.2**      By-laws, as amended

4.1****    Form of Securities Purchase Agreement between the Company and Capital Ventures, International,
           Nelson Partners, Olympus Securities, Ltd. and CC Investments, LDC.

4.2****    Registration Rights Agreement between the Company and Richard L. Apel.

4.3****    Registration Rights Agreement between the Company and Capital Ventures, International, Nelson
           Partners, Olympus Securities, Ltd. and CC Investments, LDC.

4.4****    Form of Convertible Debenture

4.5****    Form of Warrant

4.6****    Proposed Form of Certificate of Designations, Preference and Rights


4.7(d)     Registration Rights Agreement made by FastComm Communications
           Corporation, in favor of the holders of common stock of Cronus
           Technology, Inc., dated as of March 31, 2000

4.8(d)     Form of Registration Rights Agreement between FastComm Communications
           Corporation, in favor of certain individuals and a subordinated debt
           holder, dated as of March 31, 2000.

4.9(e)     Debenture Purchase and Security Agreement by and between FastComm
           Communications Corporation and Wesley Clover Corporation dated May
           22, 2001.

4.10(e)    Form of Convertible Subordinated Secured Debenture dated June 8, 2001.

4.11(e)    Form of Common Stock Purchase Warrant between FastComm Communications
           Corporation in favor of Wesley Clover Corporation dated as of June 8,
           2001.


10.0**     Employment Agreement between the Company and Robert C. Abbott

10.1**     October 15, 1987 License Agreement between
           the Company and Data Race, Inc.

10.2***    February 27, 1991 Lease Agreement between the Company and
           Dulles/Route 28 Limited Partnership with respect to the premises at
           45472 Holiday Drive, Sterling, VA 22110

10.3***    Employment Agreement between the Company and William Flanagan

10.4***    Technology Transfer Agreement with Sigma Technology

10.5***    Agreement in Principle with Watch Hill Research

10.6***    Technology License Agreement with Protocom Devices

10.7***    Loan Agreement with Sovran Bank

10.8***    Employment Agreement among the Company, Robert N. Dennis and
           Edward R. Olson, as the "Current Directors," and Peter C. Madsen.

10.9***    Option Agreement by the Company in favor of Charles L. Deslaurier.

10.10***   Option Agreement by the Company in favor of Rick Sampley.
</TABLE>


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<PAGE>   80


<TABLE>
<S>        <C>
10.11***   Amended and Restated Employment Agreement
           between the Company and Robert N. Dennis.

10.12*     Exclusive Master Distribution Agreement for FastComm Products
           between FastComm Communications Corporation and Daitel Technologies

10.13*     Distribution Agreement for products between FastComm Communications
           Corporation and C&L Communications, Inc.

10.14*     Distributor Agreement for FastComm products between FastComm
           Communications Corporation and Tadiran, Ltd.

10.15*     Distribution Agreement between the Company and Sumitronics, Inc.

10.16*     Consulting Agreement between Gary H. Davison and Newbridge Networks Inc.

10.17*     Agreement between the Company and ZyBel Microsystems, Inc.

10.18  (a) Plan of Reorganization Under Chapter 11

10.19  (b) Acquisition Agreement, KG Data Systems, Inc.

10.20  (c) Employment Agreement of Dr. Kenneth A. Bloom


10.21(d)   Agreement and Plan of Reorganization by and among FastComm Communications
           Corporation, Cronus Technology, Inc., Cronus Communications, Inc., and certain
           principal Stockholders, dated as of March 27, 2000.

10.22(d)   Form of Warrant Agreement between FastComm Communications Corporation
           in favor of certain individuals, dated as of March 31, 2000.

10.23(d)   Investment Banking Agreement between FastComm Communications Corporation and Kaufman
           Bros. LLP, dated January 24, 2000.

10.24(d)   Financial Advisor Agreement between FastComm Communications Corporation and Kaufman
           Bros. LLP, dated March 14, 2000.


10.25(d)   Warrant Agreement between FastComm Communications Corporation and Kaufman Bros. LLP, dated
           February 1, 2000.

10.26      Loan Agreement with Alliance Financial Capital Corporation

11.0*      Statement re: Computation of per share earnings.
</TABLE>


-----------

*         Filed with revised form 10KA filed August 12, 1994.

**        These exhibits are incorporated by reference from the corresponding
          exhibits to the Company's Form S-18 Registration Statement, SEC File
          Number 333-19758.

***       These exhibits are incorporated by reference from the corresponding
          exhibits to the Company's Form S-3 Registration Statement, SEC File
          No. 333-43374.

****      These exhibits are incorporated by reference from the corresponding
          exhibits to the Company's Form S-3 Registration Statement, see File
          No. 333-26459

(a)     Filed with Form 8K dated April 6, 1999

(b)     Filed with Form 8K dated April 21, 1999


                                       40

<PAGE>   81

(c)     Filed with Form 8K dated April 21, 1999

(d)     Filed with Form 8K dated April 14, 2000

(e)     Filed with Form 8K dated June 12, 2001




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