SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 10-Q

(Mark One)
[ X ]        QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
             SECURITIES EXCHANGE ACT OF 1934.

               For the quarterly period ended February 28, 2001.


                                       OR

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

For the transition period from                 to
                               ---------------     --------------.

                          Commission file number 0-4465

                            eLEC Communications Corp.
--------------------------------------------------------------------------------
             (Exact Name of Registrant as Specified in Its Charter)


               New York                                      13-2511270
--------------------------------------------------------------------------------
 (State or Other Jurisdiction                              (I.R.S. Employer
   of Incorporation or Organization)                       Identification No.)



  543 Main Street New Rochelle, New York                         10801
--------------------------------------------------------------------------------
  (Address of Principal Executive Offices)                     (Zip Code)


Registrant's Telephone Number, Including Area Code  914-632-8005
                                                    ------------

                 509 Westport Avenue Norwalk, Connecticut 06851
-------------------------------------------------------------------------------
   (Former Name, Former Address and Former Fiscal Year, if Changed Since Last
                                    Report)


               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 .

Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as

of the latest practicable date:   14,942,421 shares of Common Stock, par value
                                  --------------------------------------------
$.10 per share, as of April 1, 2001.
------------------------------------


<PAGE>


                          PART 1. FINANCIAL INFORMATION
                          -----------------------------
Item 1.  Financial Statements
                   eLEC Communications Corp. and Subsidiaries
                      Condensed Consolidated Balance Sheets
<TABLE>
<CAPTION>


                                                                                     Feb. 28, 2001      Nov. 30, 2000
                                                                                     -------------      -------------
                                                                                       (Unaudited)         (See note)
<S>                                                                                   <C>                <C>
Assets
Current assets:
  Cash and cash equivalents                                                           $    248,488       $    509,657
   Accounts receivable                                                                   3,326,307          2,803,888
   Investment securities                                                                   733,542          1,619,822
   Inventory                                                                               392,697            529,933
   Prepaid expenses and other current assets                                               572,041            579,107
   Land and building held for sale                                                              --            533,239
                                                                                      ------------       ------------
Total current assets                                                                     5,273,075          6,575,646
                                                                                      ------------       ------------

Property, plant  and equipment, net                                                      3,452,922          2,035,117
                                                                                      ------------       ------------

Other assets
  Other investments                                                                        240,000            100,000
  Goodwill                                                                               3,260,535          3,421,512
  Investment securities, non-current                                                     1,468,800          2,000,000
  Other                                                                                    714,234            734,555
                                                                                      ------------       ------------
                                                                                         5,683,569          6,256,067
                                                                                      ------------       ------------
Total assets                                                                          $ 14,409,566       $ 14,866,830
                                                                                      ============       ============

Liabilities and stockholders' equity
Current liabilities:
  Secured short-term borrowings                                                       $    150,000       $    150,000
  Current maturities of long-term debt                                                     103,060            398,709
  Accounts payable                                                                       2,623,130          2,364,977
  Accrued expenses                                                                       1,500,711          1,294,457
  Taxes payable                                                                            425,476            311,165
                                                                                      ------------       ------------
Total current liabilities                                                                4,802,377          4,519,308
                                                                                      ------------       ------------

Long-term debt, less current maturities                                                  3,736,951          1,715,723
                                                                                      ------------       ------------

Stockholders' equity:
  Preferred stock, $.10 par value, 1,000,000 shares authorized
    Series B issued, 16 and 116 shares in 2001 and 2000                                          2                 12
  Common stock $.10 par value, 50,000,000 shares authorized,
    14,942,421 and 14,642,421shares  issued in 2001 and 2000                             1,494,242          1,464,242
  Capital in excess of par value                                                        25,429,467         25,319,457
  Retained earnings (deficit)                                                          (23,218,006)       (21,744,234)
  Treasury stock at cost, 11,000 shares                                                    (27,500)           (27,500)
   Accumulated other comprehensive income (loss)                                         2,192,033          3,619,822
                                                                                      ------------       ------------
      Total stockholders' equity                                                         5,870,238          8,631,799
                                                                                      ------------       ------------
Total liabilities and stockholders' equity                                            $ 14,409,566       $ 14,866,830
                                                                                      ============       ============
</TABLE>


See notes to the condensed consolidated financial statements




Note:  The balance  sheet at November  30, 2000 has been  derived  from  audited
financial  statements at that date but does not include all the  information and
footnotes required by generally accepted accounting principles



                                       2
<PAGE>


                   eLEC Communications Corp. and Subsidiaries
     Condensed Consolidated Statements of Operations and Comprehensive Loss
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                    For the Three Months Ended

                                                                  Feb. 28, 2001      Feb. 29, 2000
                                                                  -------------      -------------
<S>                                                                <C>                <C>
  Revenues                                                         $  4,730,647       $  2,226,233
  Cost of revenues                                                    3,055,839          1,484,456
                                                                   ------------       ------------
           Gross profit                                               1,674,808            741,777
                                                                   ------------       ------------

Costs and expenses:
   Selling, general and administrative                                3,420,758          1,264,358
   Depreciation and amortization                                        235,373            105,365
   Equity in loss of investee                                                --             77,321
                                                                   ------------       ------------
            Total costs and expenses                                  3,656,131          1,447,044
                                                                   ------------       ------------

Loss from operations                                                 (1,981,323)          (705,267)
                                                                   ------------       ------------

Other income (expense):
Interest expense                                                       (132,423)           (19,163)
Interest income                                                           5,806              8,251
Miscellaneous income, net                                               634,168             67,279
                                                                   ------------       ------------
                                                                        507,551             56,367
                                                                   ------------       ------------

Net loss                                                           (  1,473,772)      (    648,900)

Other comprehensive loss -  unrealized
 loss on marketable securities                                         (794,798)                --
                                                                   ------------       ------------

Comprehensive loss                                                 ($ 2,268,570)      ($   648,900)
                                                                   ============       ============

Basic and diluted loss per share                                   ($      0.10)      ($      0.06)
                                                                   ============       ============

Weighted average number of common shares outstanding                 14,711,421         11,739,156
                                                                   ============       ============
</TABLE>


See notes to the condensed consolidated financial statements


                                       3
<PAGE>


                   eLEC Communications Corp. and Subsidiaries
                 Condensed Consolidated Statements of Cash Flows
                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                       For the Three Months Ended
                                                                    Feb. 28, 2001     Feb. 29, 2000
                                                                    -------------     -------------
<S>                                                                  <C>               <C>
Net cash used in operating activities:                               ($1,672,591)      ($  760,151)
                                                                     -----------       -----------

Cash flows from investing activities:
   Purchase of property and equipment                                   (794,982)         (164,112)
   Proceeds from sale of marketable securities                           633,033                --
   Acquisition of Telecarrier Services Inc.                                   --            (7,718)
   Proceeds from sale of property                                        933,238                --
   Proceeds from agreement to sell subsidiary                             14,554            14,554
                                                                     -----------       -----------
Net cash provided by (used in) investing activities                      785,843          (157,276)
                                                                     -----------       -----------

Cash flows from financing activities:
   Increase in loans payable to financial institutions                   909,499           187,445
   Pay-off of Canadian mortgage                                         (283,920)               --
   Proceeds from exercise of warrants                                         --           929,375
   Proceeds from private placement of common stock                            --         1,379,500
   Proceeds from exercise of stock options                                    --           214,250
                                                                     -----------       -----------
Net cash provided by financing activities                                625,579         2,710,570
                                                                     -----------       -----------

Effect of exchange rate changes on cash                                       --            40,011
                                                                     -----------       -----------

(Decrease) increase in cash and cash equivalents                        (261,169)        1,833,154
Cash and cash equivalents at beginning of period                         509,657           591,299
                                                                     -----------       -----------
Cash and cash equivalents at the end of period                       $   248,488       $ 2,424,453
                                                                     ===========       ===========
Supplemental disclosures of cash flow information
Cash paid during the period for:
      Interest                                                       $   132,423       $    27,200
                                                                     -----------       -----------
      Income taxes                                                            --                --
                                                                     -----------       -----------
</TABLE>


See Part II, Item 2., Changes in Securities,  for non-cash financing  activities
    during the three-month period ending February 28, 2001

See notes to the condensed consolidated financial statements.



                                       4
<PAGE>


                            eLEC COMMUNICATIONS CORP.

        Notes To Condensed Consolidated Financial Statements (Unaudited)


Note 1-Basis of Presentation

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial  information and with the  instructions to Form 10-Q and Article 10 of
Regulation  S-X.  Accordingly,  they do not include all of the  information  and
footnotes  required by generally  accepted  accounting  principles  for complete
financial statements. In the opinion of management,  all adjustments (consisting
of normal recurring accruals)  considered necessary for a fair presentation have
been included.  Operating results for the three-month  period ended February 28,
2001 are not necessarily  indicative of the results that may be expected for the
year ended November 30, 2001. For further information, refer to the consolidated
financial  statements  and footnotes  thereto  included in the Company's  Annual
Report on Form 10-K for the year ended November 30, 2000.


Note 2-Principal Financing Arrangements

 On October 23, 2000,  we  converted  our existing  receivable  sales  agreement
between RFC Capital Corporation  ("RFC") and our wholly-owned subsidiary,  Essex
Communications,  Inc. ("Essex"),  to a loan and security agreement with RFC. The
new loan  agreement  initially  provides for a loan facility of up to $5,000,000
based upon a borrowing  eligibility  formula  contained in the agreement.  Loans
under the loan  agreement  bear  interest at a rate per annum equal to the prime
rate plus 4.5% (13% at February 28, 2001), and require an annual fee of $75,000.
The loan agreement  contains  various  financial and operating  covenants on the
part of Essex, including restrictions on borrowings, payment of dividends, asset
dispositions  and capital  expenditures.  Essex may  increase  the maximum  loan
amount available under the loan agreement if RFC, in its sole discretion, agrees
in writing to such  increase,  in minimum  increments of $1,000,000 to a maximum
loan amount of up to $10,000,000, subject to the formula restrictions, by paying
additional  fees.  All amounts  payable under the loan  agreement are secured by
substantially all of the assets of Essex. eLEC  Communications  Corp.  ("eLEC"),
the parent  company of Essex,  has  guaranteed  the repayment of all  borrowings
under the loan  agreement,  and has pledged as  collateral  1,000,000  shares of
common stock of Talk America Holdings,  Inc. ("Talk").  The loan agreement has a
termination date of the earlier of (a) October 23, 2003; (b) the occurrence of a
termination event (as defined); (c) the occurrence of an event of seller default
(as defined); or (d) 90 days following payment by Essex of a termination fee (as
defined).  In addition,  upon  execution of the loan  agreement,  we granted RFC
warrants to purchase  200,000 shares of our common stock.  The fair market value
of the warrants has been  accounted for as an additional  interest  expense over
the term of the agreement.  At February 28, 2001,  approximately  $2,770,000 was
outstanding under the agreement.



                                       5
<PAGE>




Note 3-Investment Securities

Details as to investment securities at February 28, 2001 are as follows:

                                                Fair                Unrealized
                               Cost             Value              Holding Gain
                               ----             -----              ------------
Equity securities            $10,308          $2,202,341            $2,192,033

Our investment securities consisted of 1,499,415 common shares of Talk valued at
$1.4688 per share.  187,691 of such shares  were placed in escrow  until  August
2001.  1,000,000  of such shares were held in escrow by RFC to secure  long-term
debt,  and  are  classified  as a  non-current  asset.  In  addition,  we hold a
non-marketable  warrant  to  purchase  285,714  Talk  shares at $2.10 per share,
expiring in 2005. The Talk shares have been subject to market fluctuations.

During the quarter  ended  February  28, 2001,  we sold 316,496  shares of Talk,
realizing a gain of $617,422,  which is included under the caption Miscellaneous
income,  net  on  the  Condensed  Consolidated   Statements  of  Operations  and
Comprehensive Loss.

Note 4-Operating Segment Information

We are organized into two operating segments, a full-service  telecommunications
segment and a specialty  retail  segment.  A  discussion  of segment  results is
presented  in  "Item  2.  Management's  Analysis  and  Discussion  of  Financial
Condition and Results of Operations."

Segment information is summarized as follows:

                              For the Three Months Ended
                           Feb. 28, 2001         Feb. 29, 2000
                           -------------         -------------
Telecommunications
Revenues                    $ 4,213,544           $ 1,750,843
Net loss                   ($ 1,509,783)         ($   684,939)

Specialty retail
Revenues                    $   517,103           $   475,390
Net income                  $    36,011           $    36,039

Total
Revenue                     $ 4,730,647           $ 2,226,233
Net loss                    ($1,473,772)          ($  648,900)



Note 6- Major Customer

During the three months  ended  February  28,  2001,  we had  telecommunications
revenue from one customer that accounted for 22% of telecommunications revenue.

Note 7 - Income Taxes

At November 30, 2000, we had net operating loss carryforwards for Federal income
tax  purposes of  approximately  $15,000,000  expiring in the years 2001 through
2019. There is an annual limitation of approximately $187,000 on the utilization
of approximately  $2,000,000 of such net operating loss carryforwards  under the
provisions of Internal Revenue Code Section 382.


                                       6
<PAGE>


As of February 28, 2001, we had an  unrealized  gain on our ownership of Talk of
approximately  $2,192,000.  Upon the sale of the Talk stock,  the net  operating
loss  will  be  reduced  to  the  extent  of any  realized  gain  on  the  sale.
Accordingly, deferred taxes have not been provided on the unrealized gain.

 .



                                       7
<PAGE>




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

               The  statements  contained in this Report that are not historical
facts are  "forward-looking  statements"  which can be  identified by the use of
forward-looking   terminology,   such  as  "estimates,"   "projects,"   "plans,"
"believes,"  "expects,"  "anticipates,"  "intends,"  or the negative  thereof or
other variations  thereon,  or by discussions of strategy that involve risks and
uncertainties.  Management  wishes to caution the reader of the  forward-looking
statements,  that such statements,  which are contained in this Report,  reflect
our current  beliefs with respect to future events and involve known and unknown
risks, uncertainties and other factors, including, but not limited to, economic,
competitive,  regulatory,  technological,  key  employee,  and general  business
factors affecting the Company's operations, markets, growth, services, products,
licenses and other  factors  discussed in the  Company's  other filings with the
Securities and Exchange Commission, and that these statements are only estimates
or  predictions.  No assurances can be given regarding the achievement of future
results, as actual results may differ materially as a result of risks facing the
Company,  and actual  events  may differ  from the  assumptions  underlying  the
statements that have been made regarding  anticipated  events.  Factors that may
cause actual results,  performance or  achievements of the Company,  or industry
results,  to differ materially from those  contemplated by such  forward-looking
statements include, without limitation: (1) the availability of additional funds
to successfully pursue the Company's business plan; (2) the Company's ability to
maintain,  attract and integrate internal management,  technical information and
management  information  systems;  (3) the time and  expense  to  construct  the
Company's planned network operations center and digital subscriber line network;
(4) the cooperation of incumbent  carriers in implementing the unbundled network
elements platform  required by the Federal  Communications  Commission;  (5) the
Company's  ability  to market its  services  to current  and new  customers  and
generate customer demand for its product and services in the geographical  areas
in  which  the  Company  can  operate;  (6) the  Company's  success  in  gaining
regulatory  approval  to  access  new  markets;  (7) the  Company's  ability  to
negotiate and maintain  suitable  interconnection  agreements with the incumbent
carriers; (8) the availability and maintenance of suitable vendor relationships,
in  a  timely  manner,  at  reasonable  cost;  (9)  the  impact  of  changes  in
telecommunication laws and regulations;  (10) the intensity of competition;  and
(10)  general  economic  conditions.   All  written  and  oral  forward  looking
statements  made in  connection  with this Report that are  attributable  to the
Company  or  persons  acting on its  behalf  are  expressly  qualified  in their
entirety by these cautionary  statements.  Given the uncertainties that surround
such statements, prospective investors are cautioned not to place undue reliance
on such forward-looking statements.

Overview

eLEC is a  full-service  telecommunications  company that focuses on  developing
integrated  telephone service in the emerging competitive local exchange carrier
("CLEC") industry. We offer an integrated set of telecommunications products and
services,  including local exchange,  local access,  domestic and  international
long distance  telephone,  calling cards,  paging,  Internet  access,  dedicated
access, Web site design, Web site hosting, Internet-based yellow-pages directory
listings and other enhanced and value-added telecommunications services tailored
to meet the needs of our  customers  and the  growing  marketplace  demand  from
small- and medium-sized businesses for reliability and speed.

                                       8
<PAGE>


The nature of our  telecommunications  business  is rapidly  evolving  and has a
limited operating history. It has rapidly grown and is now substantially  larger
in revenues than a specialty  retail  business we also own, which sells products
over  the  Internet  and  in  three  retail  stores.  As a  result,  we  believe
period-to-period  comparisons of our revenues and operating  results,  including
our network  operations  and other  operating  expenses as a percentage of total
revenue,  are not  meaningful  and should not be relied  upon as  indicators  of
future  performance.  We  also  believe  our  historical  growth  rates  are not
indicative of future growth rates.

We  primarily  utilize the  Unbundled  Network  Elements  Platform  ("UNE-P") to
provide local  telephone  service to our customers.  The UNE-P service  offering
allows us to lease from the incumbent local exchange carriers  ("ILECs"),  on an
as-needed basis,  multiple  unbundled network elements and combine them into our
own full service platform. We lease a combination of network elements, including
the local loop, a network interface  device,  where the local loop terminates at
the  customer's  premises,  a switch  port that  connects  the local loop to the
ILEC's  switch,  the  switching  functionality  of the  ILEC's  switch,  and the
transport of telephone calls between ILEC switches for local calls, or to a long
distance telephone company's point-of-presence for a long distance call. We have
chosen this  platform to grow our customer  base because it allows us to rapidly
enter new markets with minimal capital expenditures. For example, we can build a
customer   base   without   deploying   either  a  local   switch  or  last-mile
infrastructure.  Instead  of buying and  maintaining  our own  equipment  in the
field,  we  utilize  the  reliable  equipment  owned by the  ILECs and focus our
resources on building a customer base.

We have applied for certification in 48 states to operate as a  facilities-based
CLEC so that we can utilize the UNE-P service offering in the entire continental
United  States.  We are also  building a network  operations  center  ("NOC") in
Norwalk, Connecticut to provide us with surveillance and deployment capabilities
for high-speed  Internet  access via Digital  Subscriber  Lines ("DSL").  We are
currently  provisioning DSL on a limited basis and we use the  infrastructure of
incumbent carriers to carry traffic on our own packet-switched  data network. We
initially  plan to offer DSL services to our existing  voice  customer  base, so
that we can  eventually use  packet-switched  technology to route local and long
distance voice traffic over the Internet.  We are currently  testing local voice
traffic solutions over a packet-switched network through our data switch that is
located in Norwalk.

Building and expanding our business has required and will continue to require us
to make  significant  expenditures  in  excess of the  amounts  of cash that our
business is generating.  As part of our "smart build" network strategy, we defer
the  purchase of equipment in the field and focus first on building our customer
base.  We believe  our  strategy of leasing the  circuit-switched  networks  and
building our own  packet-switched  network will help our  operations to generate
positive cash flow much sooner than the strategy used by other CLECs of building
a circuit-switched network before a customer base has been established.
We have experienced  operating losses and generated  negative cash flow since we
began  operating as a CLEC and we expect to continue to generate  negative  cash
flow for a period of time while we  continue  to expand our  network and develop
product  offerings and our customer  base. We cannot assure you that our revenue
or  customer  base will  increase  or that we will be able to achieve or sustain
positive cash flow.


                                       9
<PAGE>



Three Months Ended February 28, 2001 vs. Three Months Ended February 29, 2000

Continuing operations

Our net revenues for the  three-month  period ending February 28, 2001 increased
by approximately  $2,505,000, or approximately 113%, to approximately $4,731,000
as compared to  approximately  $2,226,000  reported for the  three-month  period
ending February 29, 2000.

Net  revenues of our  telecommunications  division  increased  by  approximately
$2,463,000,   or  approximately  141%,  to  approximately   $4,214,000  for  the
three-month  period  ending  February  28,  2001 from  approximately  $1,751,000
reported in the  three-month  period ending  February 29, 2000. The increase was
attributable  to the  continued  rapid growth in the number of installed  access
lines that we provisioned from approximately 11,000 installed access lines as of
February 29, 2000 to approximately  40,000 installed access lines as of February
28, 2001.

Net  revenues  of  our  specialty  retail  sales  division,  consisting  of  the
operations of Airline  Ventures,  Inc.  ("AVI"),  increased for the  three-month
period ending February 28, 2001 by approximately  $42,000,  or approximately 9%,
to  approximately   $517,000  from   approximately   $475,000  reported  in  the
three-month  period ending February 2, 2000. AVI operates three retail stores in
Texas for  professional  airline  flight crew members and sells pilot  uniforms,
study guides and travel  products.  Its products are sold on the E-commerce site
www.avishop.com.

Our gross profit for the  three-month  period ending February 28, 2001 increased
by  approximately  $933,000  to  approximately   $1,675,000  from  approximately
$742,000  reported in the  three-month  period ending February 29, 2000, and the
gross  profit  percentage  increased  to 35.4% from 33.3%  reported in the prior
fiscal period.  For the  three-month  period ending February 28, 2001, the gross
profit percentage of our telecommunications  division increased to approximately
34.8% from 30.7%  reported in the prior  fiscal  period.  The  increase in gross
profit  percentage is primarily  attributable to our ability to reduce the costs
we pay to the incumbent carriers for our service platform. We anticipate that we
will be able to maintain a gross margin of  approximately  35% or higher,  as we
expand into  expand into new  geographical  territories.  However,  our costs of
providing  services  vary in each state and our  blended  gross  margins  may be
impacted by our  concentration  of  customers in each state in which we operate.
Our  specialty   retail   division   recorded  a  gross  profit   percentage  of
approximately  40.7% for the  three-month  period  ending  February  28, 2001 as
compared to approximately  42.9% reported in the prior fiscal period.  We expect
the gross  margin of our  specialty  retail  segment to  continue at its current
level of over 40%.

Selling,   general  and  administrative   expenses  increased  by  approximately
$2,157,000,   or  approximately  171%,  to  approximately   $3,421,000  for  the
three-month  period  ending  February  28,  2001 from  approximately  $1,264,000
reported  in  prior  fiscal  period.  A  major  portion  of  this  increase  was
attributable  to the costs of our expanding  marketing  efforts and to the labor
and facility expenses incurred by our telecommunications division. This increase
in expense is directly related to the significant increase in telecommunications
revenues in the  three-month  period ending February 28, 2001 as compared to the
prior fiscal period in 2000.

                                       10
<PAGE>



At  February  28,  2001,  we had  no  ownership  interest  in  RiderPoint,  Inc.
("RiderPoint")  as compared to our ownership  interest of  approximately  27% at
February 29, 2000. As our  investment in RiderPoint  was accounted for under the
equity  method  of  accounting,  we  were  required  to  include  a  portion  of
RiderPoint's  operating  net  loss  in  our  results  of  operations.   For  the
three-month period ending February 29, 2000, we recorded a loss of approximately
$77,000 relating to our investment in RiderPoint.

Interest  expense for the three-month  period ending February 28, 2001 increased
by  approximately  $113,000 from the amount reported in the  three-month  period
ending February 29, 2000 primarily due to increased average borrowings.

Miscellaneous  income for the  three-month  period  ending  February 28, 2001 of
$634,000 resulted primarily from the sale of Talk shares.


Liquidity and Capital Resources

At  February  28,  2001,  we  had  cash  and  cash   equivalents   available  of
approximately  $248,000,  and  working  capital  of  approximately  $471,000,  a
decrease of approximately $2,176,000 and $1,605,000,  respectively, from amounts
reported in the prior  fiscal  period.  During  February  2000,  we received net
proceeds of  approximately  $2,000,000  from the exercise of warrants and from a
private  placement of our common stock. At February 28, 2001, we owned 1,499,415
shares of Talk,  at a market  value of  $2,192,033.  However,  1,000,000  of the
shares of Talk were  classified as a non-current  asset because they are held in
escrow by a lender in conjunction with a long-term debt facility.

Net cash used in operating activities  aggregated  approximately  $1,673,000 and
$760,000 in the  three-month  periods ending  February 28, 2001 and February 29,
2000,  respectively.  The  principal  use of cash in  fiscal  2001  and 2000 was
approximately $1,474,000 and $649,000, respectively,  relating to the losses for
the periods.

Net cash provided by (used in)  investing  activities  aggregated  approximately
$786,000 and ($157,000) in the three-month  periods ending February 28, 2001 and
February  29,  2000,  respectively.  The sources of cash  provided by  investing
activities  in  fiscal  2001  were the  proceeds  from  the  sale of  marketable
securities of approximately  $633,000, the proceeds from the sale of property of
approximately  $933,000 and the proceeds  from the 1992 sale of a subsidiary  of
approximately $15,000. This was partially offset by the purchase of property and
equipment of  approximately  $795,000.  Net cash used in fiscal 2000 was for the
purchase  of fixed  assets and the  acquisition  of  Telecarrier,  amounting  to
approximately  $164,000 and $8,000,  respectively.  The source of cash  provided
from  investing  activities in the first fiscal quarter of 2000 was the proceeds
of approximately $15,000 from the 1992 sale of a subsidiary.

Net cash provided by financing activities aggregated  approximately $626,000 and
$2,711,000 in the three-month  periods ending February 28, 2001 and February 29,
2000,  respectively.  The source of net cash  provided by  financing  activities
resulted  primarily from the proceeds of borrowings from financial  institutions
of  approximately  $909,000,  offset by the pay-off of our Canadian  mortgage of
approximately  $284,000.  In fiscal  2000,  the source of net cash  provided  by

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financing activities resulted from the proceeds of a private equity placement of
approximately  $1,380,000,  the exercise of warrants of approximately  $929,000,
the exercise of stock  options of  approximately  $214,000 and  borrowings  from
financial institutions of approximately $187,000.


On October 23,  2000,  we  converted  our existing  receivable  sales  agreement
between  RFC and our  wholly-owned  subsidiary,  Essex,  to a loan and  security
agreement  with  RFC.  The new  loan  agreement  initially  provides  for a loan
facility  of up  to  $5,000,000  based  upon  a  borrowing  eligibility  formula
contained in the  agreement.  Loans under the loan  agreement bear interest at a
rate per annum equal to the prime rate plus 4.5% (13% at February 28, 2001), and
require an annual fee of $75,000.  The loan agreement contains various financial
and  operating  covenants  on the  part  of  Essex,  including  restrictions  on
borrowings,  payment of dividends,  asset dispositions and capital expenditures.
Essex may increase the maximum loan amount available under the loan agreement if
RFC,  in its sole  discretion,  agrees in writing to such  increase,  in minimum
increments of $1,000,000 to a maximum loan amount of up to $10,000,000,  subject
to the formula  restrictions,  by paying  additional  fees. All amounts  payable
under the loan  agreement  are  secured  by  substantially  all of the assets of
Essex.  eLEC, the parent  company of Essex,  has guaranteed the repayment of all
borrowings  under the loan  agreement,  and has pledged as collateral  1,000,000
shares of common stock of Talk. The loan agreement has a termination date of the
earlier of (a) October 23, 2003; (b) the  occurrence of a termination  event (as
defined);  (c) the occurrence of an event of seller default (as defined); or (d)
90 days  following  payment  by  Essex of a  termination  fee (as  defined).  In
addition,  upon  execution  of the loan  agreement,  we granted RFC  warrants to
purchase  200,000  shares of our  common  stock.  The fair  market  value of the
warrants has been accounted for as an additional  interest expense over the term
of the agreement. At February 28, 2001, approximately $2,770,000 was outstanding
under the agreement.


For the three-month  period ending  February 28, 2001, our capital  expenditures
amounted to  approximately  $1,895,000,  which included the purchase of a 40,000
square  foot  building  in New  Rochelle,  New York for  $1,500,000.  The seller
financed  $1,100,000 of the purchase with a five-year mortgage loan, which bears
interest  at a rate of 10%  per  annum  for the  first  year  and 11% per  annum
thereafter.  We expect to make additional  capital  expenditures  related to the
acquisition  of this  building so that it can serve as an in-bound and out-bound
call  center,   our  second   network   operations   center  and  our  corporate
headquarters. We anticipate that we will need to spend an additional $200,000 in
fiscal 2001 for  equipment,  furniture  and  fixtures.  Equipment  purchases are
anticipated to be financed through equipment leases or with working capital.

  At April 10, 2001, we beneficially  owned  approximately 1.8 million shares of
Talk  (NASDAQ:TALK).  Of such shares, we can sell  approximately  300,000 shares
without  permission  from RFC. We require  RFC's  consent to sell one million of
such shares.  Approximately  200,000 additional shares are held in escrow and we
have  the  right to  purchase  approximately  300,000  additional  shares  if we
exercise a warrant.  The warrant exercise price is $2.10 per share and, at April
10, 2001,  was not  in-the-money,  as the closing price of Talk common stock was
$2.01 per share at such  date.  At April 10,  2001,  we also  owned 1.4  million
shares of  CyberOpticsLabs  Inc.  (OTCBB:CYOL).  These  shares  are  "restricted
securities"  and  will not be  eligible  for sale in the  public  markets  until
February  2002.  In  addition  to the  securities  that we  own,  we have a loan
facility  with RFC that  allows us to borrow  based upon a multiple  of our cash
collections. We believe this facility alone will not be sufficient to provide us
with the growth capital we need to achieve the growth rates that our back office

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<PAGE>

systems can  support.  As a result,  the price that we receive  from selling our
shares of Talk common stock will impact our growth rate in fiscal 2001.

  Management  believes that the working capital and cash flow from operations of
our retail division will be sufficient to meet the cash and capital requirements
of our retail  division  for the next 12 months.  Our plan for the growth of our
telecommunications  division  includes an aggressive  strategy to obtain as many
new local access lines as our cash resources  allow. We will need to expend cash
and incur  additional  losses before we are able to grow our  telecommunications
business to a profitable level. We believe our cash and investment securities at
February 28, 2001,  in addition to our loan  facility  with RFC, will provide us
with  sufficient  liquidity  to grow  our  business  and  carry  out many of our
expansion  plans.  However,  the market relating to such  securities  could vary
widely  during  the year,  and we may  ultimately  monetize  some or all of such
securities  at prices  that will not  generate  sufficient  cash to enable us to
carry out our fiscal 2001 operating plans. We also believe that we could receive
additional funding from a private placement of our common stock. However,  there
can be no assurances that we will be able to obtain such funding when needed, or
that such funding,  if available,  will be obtainable on terms acceptable to us.
Moreover,  we have been notified by NASDAQ that in accordance  with  Marketplace
Rule  4310(c)(8)(B),  we have until June 18, 2001 to regain compliance with Rule
4310(c)(4), which requires that our common stock maintain a minimum bid price of
$1.00.  If we are unable to demonstrate  compliance  with this rule on or before
June 18, 2001, we will receive written  notification that our securities will be
delisted.  Although we are allowed to appeal such delisting notice,  such notice
may further impact our ability to raise capital.  The inability to carry out our
fiscal  2001  operating  plans may  result in the  continuance  of  unprofitable
operations,  which would adversely affect our financial condition and results of
operations.




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                            eLEC COMMUNICATIONS CORP.
                            PART II-OTHER INFORMATION

Item 2.        Changes in Securities

                             On  February  2, 2001,  we issued an  aggregate  of
                             200,000  shares of our common stock in  conjunction
                             with the  purchase  of  certain  investments.  Such
                             transaction was effected  pursuant to Sections 4(2)
                             of the Securities Act of 1933, as amended.

                             On February 8, 2001,  a holder of 100 shares of our
                             Series A Preferred Stock, par value $.10, converted
                             such shares of preferred  stock into 100,000 shares
                             of our common stock.  Such transaction was effected
                             pursuant to Sections 3(9) of the  Securities Act of
                             1933, as amended.




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Item 6.                      Exhibits and Reports on Form 8-K

                              (a) Exhibits.
                                    None


                              (b) Reports on Form 8-K
                                    None.




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                                   Signatures

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

                                     eLEC Communications Corp.



    April 16, 2001                   By: /s/ Paul H. Riss
-------------------------                ----------------------------
Date                                     Paul H. Riss
                                         Chief Executive Officer
                                        (Principal Financial and
                                         Accounting Officer)