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


                                    FORM 10-K

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

                  For the fiscal year ended: December 31, 1999

                                       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: 0-21823

                                 FIBERCORE, INC.
             (Exact name of registrant as specified in its charter)

               Nevada                                           87-0445729
----------------------------------------                        ----------
   (State or other jurisdiction of                           (I.R.S. Employer
    incorporation or organization)                          Identification No.)

                        253 Worcester Road, P.O. Box 180
                               Charlton, MA 01507
                               ------------------
              (Address and Zip Code of principal executive offices)

                                 (508) 248-3900
                                 --------------
              (Registrant's telephone number, including area code)

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 $.001 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),

                         Yes    X              No
                            ---------            ---------
and

(2) has been subject to such filing requirements for the past 90 days.

                          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 [ ].

The  aggregate  market  value of  voting  stock  held by  non-affiliates  of the
registrant as of March 1, 2000: $227,559,969.

Number of shares outstanding as of March 1, 2000:  41,932,472.


                       DOCUMENTS INCORPORATED BY REFERENCE
                       -----------------------------------

None


<PAGE>

                                 FIBERCORE, INC.
                                TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                                                        Page
<S>                                                                                                                       <C>
PART I.............................................................................................................       3
         ITEM 1.           BUSINESS................................................................................       3
         ITEM 2.           PROPERTIES..............................................................................      14
         ITEM 3.           LEGAL PROCEEDINGS.......................................................................      14
         ITEM 4.           SUBMISSION OF MATTERS TO A VOTE OF SECURITY
                           HOLDERS.................................................................................      15

PART II  ..........................................................................................................      16
         ITEM 5.           MARKET FOR REGISTRANT'S COMMON EQUITY AND
                           RELATED STOCKHOLDER MATTERS.............................................................      16
         ITEM 6.           SELECTED FINANCIAL DATA.................................................................      17
         ITEM 7.           MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
                           CONDITION AND RESULTS OF OPERATIONS.....................................................      18
         ITEM 7A.          QUANTITATIVE AND QUALITATIVE DISCLOSURES
                           ABOUT MARKET RISK.......................................................................      25
         ITEM 8.           FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.............................................      26
         ITEM 9.           CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
                           ACCOUNTING AND FINANCIAL DISCLOSURE.....................................................      49

PART III ..........................................................................................................      50
         ITEM 10.          DIRECTORS AND EXECUTIVE OFFICERS OF THE
                           REGISTRANT..............................................................................      50
         ITEM 11.          EXECUTIVE COMPENSATION..................................................................      52
         ITEM 12.          SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
                           AND MANAGEMENT..........................................................................      55
         ITEM 13.          CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS..........................................      57

PART IV  ..........................................................................................................      58
         ITEM 14.          EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS
                           ON FORM 8-K.............................................................................      58

SIGNATURES.........................................................................................................      61
</TABLE>
                                       2
<PAGE>

                                     PART I
                                     ------

ITEM 1.      BUSINESS

GENERAL

         FiberCore,  Inc.  ("FiberCore"  or the  "Company")  is  engaged  in the
business of developing,  manufacturing, and marketing single-mode and multi-mode
optical fiber and optical  fiber  preforms for the  telecommunications  and data
communications  industry.  Preforms are the basic  component  from which optical
fiber is drawn and  subsequently  cabled.  The Company has  developed a patented
preform  production  process which  management  believes to be competitive  with
other existing production methods in use. The Company's principal operating unit
is  FiberCore  Jena GmbH  ("FCJ"),  the  Company's  wholly-owned  subsidiary  in
Germany.

         On  September  18,  1995,   the  Company   acquired   Automated   Light
Technologies,  Inc.  ("ALT").  ALT, a Delaware  corporation  organized  in 1986,
manufactures  equipment  that  monitors  and  identifies  faults in fiber  optic
cables, cable protection devices, and electro-optical talk sets. The Company has
focused its resources on developing its optical fiber and preform  business and,
therefore,  has not been  actively  developing  the ALT  business.  The Company,
however,  intends  to  devote  resources  and  efforts  to the ALT  products  as
resources become available.

         In November 1997, the Company  entered into a  joint-venture  agreement
with PNB Equity Resource  Corporation Sdn. Bhd.  ("PERC") and Federal Power Sdn.
Bhd. ("FDP"), both of which are Malaysian  corporations,  to form FiberCore Asia
Sdn. Bhd.  ("FCA").  FCA, which is incorporated in Malaysia,  was established to
construct and operate a manufacturing facility in Malaysia for the production of
optical fiber and optical fiber  preforms.  The Company owns 51% of FCA, and FDP
and PERC own 37% and 12%, respectively.

         The Company  granted FCA a license to use the Company's  technology for
its 51%  ownership,  while  FDP and PERC  contributed  cash and  notes for their
respective  ownership  interest.  Due  principally  to the economic and currency
crisis experienced in the Asian/Pacific  region, the debt financing necessary to
construct the manufacturing facility has not, as yet, been obtained. The Company
and the other  partners in FCA are  continuing to seek  financing and additional
equity for FCA. The products of FCA will be marketed  principally in the Pacific
Rim.

         The  following  is an  organizational  chart  depicting  the  Company's
principal subsidiaries and ownership percentage.

<TABLE>
<CAPTION>
                                                        FIBERCORE, INC.
                                                      CORPORATE STRUCTURE
                                                          Headquarters
                                                             ( USA)
-------------------------------------------------------------------------------------------------------------------------------
<S>                  <C>                  <C>                        <C>                  <C>                         <C>
FiberCore Asia     FOI (Pvt.) Ltd.      FiberCore Jena GmbH       InfoGlass, Inc.      FiberCore MidEast Ltd.       ALT, Inc.
  Sdn. Bhd.          (Pakistan)             (Germany)                ( USA )                  (Asia)                   (USA)
 (Malaysia)          30% Owned             100% Owned               100% Owned               100% Owned             100% owned
51% Owned            (inactive)                                      (inactive)     Middle East Fiber Cables Co.
                                                                                            15% Owned by
                 .                                                                     FiberCore MidEast Ltd.
</TABLE>

                                       3
<PAGE>
                              BUSINESS (CONTINUED)

           Substantially  all of the Company's  sales are from optical fiber and
optical fiber  preforms.  ALT accounted for less than 5% of sales in each of the
last three years.

RECENT DEVELOPMENTS

         In January 1998,  Corning  Incorporated  filed suit against the Company
claiming the Company's  phosphorus  containing  fiber violated a Corning patent.
During 1998 the suit was settled by the Company agreeing not to solicit,  market
or sell  phosphorus  containing  multimode  fiber in the United States until the
Corning  patent  expired in July 1999.  The  Company  also  agreed to conduct an
arbitration  to determine  whether the Company's  singlemode  fiber violates the
Corning patent. In March 1999, the arbitrator issued an opinion  concluding that
FiberCore's  singlemode fiber does not violate the Corning patent. Prior to July
1999,  the Company had not sold any material  quantities  of fiber in the United
States.

         In  July  1996,  Tyco  Electronics  Corp.   ("Tyco"),   (formerly  AMP,
Incorporated),  entered into a supply  contract  which ends on December 31, 2000
(renewable at Tyco's option for an additional five year period) with the Company
whereby Tyco has  undertaken to purchase from the Company at least 50% of Tyco's
future glass optical fiber needs.

         In 1995, the Company,  through its subsidiary,  FiberCore  MidEast Ltd.
("FME"),  entered into a joint venture  agreement  (the "MidEast JV  Agreement")
with Middle East Fiber Optic  Manufacturing  Company Limited ("MEOFC"),  a Saudi
Arabian  company,  and John Royle and Sons,  Inc.  ("Royle"),  a manufacturer of
cable manufacturing systems.  Pursuant to the agreement, the parties jointly own
Middle East Fiber Cables Co.,  ("MEFC"),  a Saudi Arabian joint venture company.
MEFC  manufactures  and sells  optical fiber and optical fiber cable both inside
and outside of Saudi Arabia.  The Company has a 15% interest in MEFC. MEFC began
operations  in  1998  and  had  sales  of   approximately   U.S.$6,587,000   and
U.S.$489,000 for the years ended December 31, 1999 and 1998, respectively.  MEFC
reported income from operations of approximately U.S.$433,000 for the year ended
December 31, 1999.

         On July  31,  1996,  the  Company  borrowed  $500,000  under  two  loan
agreements with the spouses of the Chairman and Chief Executive  Officer and the
Executive Vice President of the Company. The loans are in the amount of $250,000
each,  and bear interest at the prime rate plus one percent  (currently  9.25%).
The loans were renewed in 1999 and in conjunction with the renewal the new loans
were  convertible into common shares of the Company at $0.26 per share which was
the  closing  trading  price on the renewal  date.  Also,  each lender  received
warrants to purchase  323,082  common shares at a price of $0.26 per share.  The
Warrants  expire on October 1, 2004. In December  1999, the loans were converted
into common shares of the Company.

         In 1998,  the expansion of the Jena facility was  completed,  more than
doubling the  production  capacity of that plant.  The  expansion  was funded by
German government grants and loans. The Company anticipates that it will outgrow
the current  leased  facility  and  therefore  is  planning  to  construct a new
manufacturing facility in the Jena area. The Company expects to finance this new
facility  under  similar  financing   arrangements  to  the  earlier  expansion,
utilizing German Government grants and guaranteed loans and equity. In addition,
due to the increased  demand for the Company's  products and the rapid growth in
the industry in general,  the Company is planning to add capacity  through joint
ventures such as FCA, and through acquisitions.

                                       4
<PAGE>

                              BUSINESS (CONTINUED)


FIBER OPTIC PREFORM MANUFACTURING TECHNOLOGIES

         Optical fibers are solid strands of hair-thin, high quality glass which
are  usually  combined  to form cables for  transmitting  information  via light
pulses from one point to another.  The fibers  consist of a core of  high-purity
glass that  transmits  light encased  within a covering layer designed to reduce
signal  loss  through  the side  walls of the  fibers.  Information  transmitted
through optical fibers is converted from electrical impulses into light waves by
a laser or light  emitting  diode.  At point of  reception,  the light waves are
converted back into electrical impulses by a photo-detector.

         Communication  by means of light  waves  guided  through  glass  fibers
offers  a  number  of  advantages  over   conventional   means  of  transmitting
information.  Glass fibers carry  significantly  more  information than metallic
conductors and, unlike metallic  conductors,  are not subject to electromagnetic
or radio  frequency  interference.  Signals of equal strength can be transmitted
over  much  longer  distances  through  optical  fibers  than  through  metallic
conductors and require the use of fewer  repeaters  (devices which  strengthen a
signal).  Further,  fiber-optic  cables,  which  typically  consists of numerous
optical fibers encased in one or more plastic sheaths, are substantially smaller
and lighter than metallic conductor cables of the same capacity,  so they can be
less expensive and more easily  installed,  particularly  in limited  conduit or
duct spaces.

         There are two basic types of  communication  optical fibers:  multimode
fiber and singlemode  fiber.  Multi-mode fiber has a larger core (the area where
the light  travels) than  singlemode  fiber,  carries less bandwidth and is more
expensive.  It is  generally  used over  relatively  short  distances  in wiring
buildings and groups of buildings.  The electronics and the connectors  required
to work with multi-mode fiber are less costly than the electronics  required for
single-mode  fiber.  For example,  the light source for multi-mode  fiber can be
light emitting  diodes,  while  single-mode  fiber requires laser light sources.
Single-mode  fiber is used in long-distance  trunk lines (cables between cities)
and  fiber-to-the-curb  (cable from a central  office to the curb in front of an
office building or home).

         The three basic technologies widely used to manufacture  multi-mode and
single-mode optical fiber are:

1.       Outside  Vapor  Deposition  ("OVD"),  otherwise  known as the  "Corning
         process."

2.       Inside  Vapor  Deposition  ("IVD"),  which is also  known  as  Modified
         Chemical Vapor  Deposition  ("MCVD") or the "AT&T process".  Due to its
         flexibility  and relative ease of  operation,  this process is the most
         widely used around the world by independent manufacturers.

3.       Axial Vapor Deposition  ("AVD"),  also known as the "Japanese process".
         This process is similar to the Corning process.

         The basic  production unit from which fiber "is drawn" is a preform.  A
preform is a  cylindrical  high purity  glass rod with a high  refractive  index
glass  material in the central part of the rod (the "core") and a low refractive
index glass  material in the outer part of the rod (the "clad").  The rod can be
less than one inch to several  inches in diameter  and one to several  meters in
length.  From one such preform many  thousands of meters of optical fiber can be
drawn.  The OVD and AVD processes both  manufacture  100% of the glass composing
the final preform and are comparable in terms of machine speeds that manufacture
glass per unit of time. These speeds are significantly  higher than those of the
IVD process. In contrast,

                                       5
<PAGE>
                              BUSINESS (CONTINUED)

the IVD process manufactures only about one-third of the total glass required in
the  manufacture of a preform,  with the balance of the glass being purchased in
the form of a tube at costs  significantly lower than that of either OVD or AVD,
thus balancing the overall expense.

         Optical fiber cable is produced  from optical  fiber by first  coloring
the coated fiber and then encasing the fiber in a protective jacket.

PROPRIETARY MANUFACTURING PROCESS AND PRODUCTS

         The Company  manufactures both multi-mode and single-mode  preforms and
fiber, but does not manufacture optical fiber cable, although MEFC, in which the
Company has an interest,  draws fiber from preforms and manufactures fiber optic
cable.

         The  Company's   patented   technology  can  be  best  described  as  a
"rod-and-tube"  process,  or as a hybrid of the OVD, IVD and the AVD  processes.
The  Company's  process  takes  advantage of available  high quality  doped1 and
undoped fused silica rods and tubes during the manufacturing  process to produce
more efficiently  single-mode  optical fiber preform and single-mode  fiber at a
substantially reduced cost than the alternative processes.

         Specifically,  the Company's process places a high-purity  "core" glass
rod inside a  high-purity  glass tube or  "clad",  which has a lower  refractive
index than the core, and collapses the tube over the rod to form an intermediate
preform. The Company purchases the glass tubes and manufactures the "core" glass
inside of the  purchased  glass tube.  The  composite  material is  subsequently
converted  to a glass rod  referred to as an  intermediate  preform or core rod.
Such intermediate  preform can also be manufactured by any of the other existing
processes. This intermediate preform is placed inside another purchased tube and
collapsed  together  to form a final  preform,  which  has the  proper  ratio of
core-to-outside-diameter-glass. The preform is then drawn into finished fiber by
placing  it  inside a "draw  furnace",  heated  to  approximately  2000  degrees
Celsius, and "stretched" into tens of thousands of meters of hair-thin, flexible
glass  fiber.   The  Company   believes   that  its  patented   process   offers
manufacturing-cost   and   capital-investment   advantages  over  the  processes
currently in use by competitors  for the  manufacture of optical fiber,  because
(i) the machine time necessary to produce a given size preform is  significantly
less,  thereby  allowing the Company to produce  more  preforms in the same time
period;  and (ii) the  Company  purchases  the tube while  manufacturing  a much
smaller portion of the clad and all of the core which accounts for approximately
5% of the preform, while the OVD process, for example,  manufactures 100% of the
preform, requiring substantially more capital investment.

         Prior  to its  acquisition  by  the  Company,  the  Jena  Facility  was
manufacturing  multi-mode  fiber and preform for the  Eastern  European  market.
Management  believes  the  time  and  cost  required  to  achieve  manufacturing
efficiencies  at the Jena  Facility were  minimized as a result of  management's
knowledge and experience in fiber production and machine design.



--------
1 Doping  means adding other glass  materials,  such as germanium dioxide to the
  silica glass.


                                       6
<PAGE>


                              BUSINESS (CONTINUED)

ALT PRODUCTS

         The Company's ALT subsidiary has four principal products,  all of which
are manufactured through subcontractors, with final assembly and testing done at
the Company's Charlton, Massachusetts facility.

         ALT's Fiber Optic Cable  Monitoring  Systems  ("FOCMS")  facilitate the
continuous  monitoring  of fiber optic and copper  cables.  The FOCMS consist of
sensors housed in a protective cover placed at cable splice points and connected
to a central  monitoring  system.  ALT holds two United States patents  covering
this  technology.  ALT purchased  one of these patents and know-how  relating to
fiber optic cable  monitoring  systems on September  7, 1986,  from  Norscan,  a
Canadian company. Norscan retained the right to use the technology in Canada and
the  rights to a Canadian  reissuance  of the  purchased  patent and has had the
technology in operation on the Trans Canada fiber optic network since 1988.  ALT
intends to make the technology widespread in other regions worldwide.

         ALT also  manufactures  patented  long-range fault locators,  which are
generally used in pairs. Typically, each device is applied at a point on a fiber
optic cable,  less than 100 miles from the other unit.  These devices can detect
and locate cable faults between the units.

         In addition,  ALT  manufactures  cable  protection  devices,  which are
applied at cable splice  joints  prior to cables  entering a building to protect
against hazardous  electrical  currents that could otherwise be carried by metal
sheaths encasing optical fibers, and electro-optical talksets. Talksets are used
by field  personnel  to  communicate  over  optical  fiber,  twisted  pair-cable
(regular  telephone cable), and metal sheaths encasing optical fibers and copper
cables.

         Customers for the FOCMS and other ALT Products have included  telephone
companies  worldwide,  including MCI  Telecommunications  Corp.,  AT&T Corp. and
Pacific Telesis.

         The Company has focused its resources on  developing  its optical fiber
and preform business and,  therefore,  has not been actively  developing the ALT
business.  Accordingly  the  activities of ALT have been  limited.  The Company,
however,  intends  to  devote  resources  and  efforts  to the ALT  products  as
resources become available.

RESEARCH AND DEVELOPMENT

         In 1998,  the Company  filed two patents for a production  process that
the Company believes when implemented  will  substantially  reduce the Company's
manufacturing  cost of optical  fiber and  preforms.  In  mid-1999,  the Company
installed  a pilot  machine  using  this new  process in Jena.  The  preliminary
results of this process are very  positive and the Company is planning to expand
its production capacity using this process in 2000.

         The Company conducts research and development ("R&D") activities at its
Jena Facility and Charlton,  Massachusetts  offices.  The Company's research and
development  activities consist primarily of optical fiber manufacturing process
improvements and optical fiber product development.


                                       7
<PAGE>


                              BUSINESS (CONTINUED)

In  addition,  the  Company is  conducting  R&D  activities  in  developing  the
following new products:

         a.  Fiber   Laser:   Fiber   Lasers   are  used  in  laser   projection
             applications,  including laser television ("TV") which are expected
             to be more cost  effective  than flat panel TV's.  Fiber lasers can
             also be used in heavy-duty commercial laser printers.

         b.  Laser   Power   Transmitting   Fibers   ("LPTF),   for  high  power
             transmission to be used in conjunction with various type of lasers.
             Fiber Laser together with LPTF is expected to replace gas lasers in
             certain  applications  such as laser welding,  laser  cutting,  and
             laser surgery.

         c.  Bragg Grading Fiber ("BGF") can also create  band-path  that,  like
             filters,  will work in the dense wavelength  division  multiplexing
             ("DWDM") applications.

         These R&D programs are partially funded by the German  Government,  and
certain  research  institutes in Germany,  as well as a certain large industrial
organization  in Germany.  Currently  these sources are providing  approximately
$90,000 in funds for the programs. Once fully developed,  the Company intends to
commercialize these products.

         The Company's R&D  expenditures  have  increased by  approximately  52%
during  1999  from the prior  year.  Such  expenditures  amounted  to  $722,000,
$475,000 and $434,000 for the fiscal years ended  December 31, 1999,  1998,  and
1997,  respectively.  The  principal  purpose  of the  research  activity  is to
implement new technology,  improve the production  process for the manufacturing
of fiber preforms with  concentration on reducing  production time, and reducing
raw material consumption per unit of product.

         Eight of the Company's employees devote substantially all of their time
to research and development. In addition, the Company has contracts with several
individuals who are involved in process development projects.

SALES AND MARKETING

         To capitalize on the growth in fiber  demand,  the Company's  sales and
marketing  objective is to increase market penetration by developing  long-term,
strategic  relationship  supply contracts for both preform and fiber products as
rapidly  as  practical;  expanding  the  Company's  global  sales and  marketing
programs;  and  emphasizing the performance and cost advantages of the Company's
patented technology for its key customers. The Company plans to sell products in
areas where it can  reasonably  expect to avoid  direct  competition  from major
suppliers of fiber,  such as Lucent  Technologies  and  Corning,  and secure its
customer  base  through  strategic  alliances.  Consistent  with this  strategy,
initial  marketing efforts for singlemode fiber and preform have been focused on
establishing  strategic  alliances  in  developing  countries  where  management
believes the demand is growing  more  rapidly  than in Europe and the  Americas.
Multimode fiber is marketed in Europe and the Americas where management believes
market  opportunities  are the  greatest  for this  product.  In July 1999,  the
Company began selling into the North American market and anticipates  that sales
growth in this region will be more rapid than in Europe.

         Management believes the telecommunications infrastructure of developing
countries  is in the  early  stages of  evolution  and  competition  is not well
established.  In the past,  developing countries would typically purchase older,
previously deployed communications  technology and equipment.  However, the lack
of a copper  cable  infrastructure  and a desire to become more  technologically
advanced has driven


                                       8
<PAGE>


                              BUSINESS (CONTINUED)

some  developing  countries  to choose  fiber optic cable  networks to develop a
sophisticated communications network. These countries must first install a fiber
optic  infrastructure  of trunk and feeder  lines  followed by fiber,  copper or
wireless to the subscriber  loop.  The Company is initially  targeting the large
fiber optic cable manufacturing  companies in Asia, the Middle East, the Pacific
Rim, and certain European  markets.  Four employees devote  substantially all of
their time to sales and marketing and are assisted in this effort by independent
sales representatives.

JOINT MANUFACTURING AND MARKETING ARRANGEMENTS

         The Company is seeking to increase market  penetration in optical fiber
markets through  strategic  alliances  and/or joint ventures similar to the MEFC
and FCA joint ventures.  These  relationships  are being  structured so that the
Company  provides the preforms and the related  technology  requirements and the
partner provides the financing, operating and local marketing expertise. In this
way, it may be possible  for the Company to rapidly  obtain  market  penetration
with little,  if any, capital  investment.  Discussions  regarding similar joint
ventures  and/or  strategic  alliances  are underway,  although  there can be no
assurances  that  such   discussions  will  lead  to  the  consummation  of  any
transactions.

CUSTOMERS, INVENTORY, BACKLOG AND ADVERTISING

         A key  element  of the  Company's  marketing  strategy  is to  maintain
sufficient raw material and finished goods  inventories to enable the Company to
fill customer orders promptly.  This strategy  requires a substantial  amount of
working  capital  to  maintain   inventories  at  a  level  sufficient  to  meet
anticipated demand.

CUSTOMERS REPRESENTING OVER 10% OF SALES

         The following  table is based on the total sales of the Company for all
periods presented.

                                               % OF SALES

                 1999
                   Customer A                       24%
                   Customer B                       21%
                   Customer C                       10%
                   Customer D                       10%
                   Customer E                   Less than 10%
                 1998
                   Customer A                       23%
                   Customer B                       22%
                   Customer C                       13%
                   Customer D                  Less than 10%
                   Customer E                       10%

                                       9
<PAGE>

                              BUSINESS (CONTINUED)

                   Customer A                        42%
                   Customer B                        17%
                   Customer C                   Less than 10%
                   Customer D                   Less than 10%
                   Customer E                   Less than 10%

         The Company believes that only the loss of Customers A and B would have
a material adverse effect on the Company.

BACKLOG, SALES AND ADVERTISING

         At December 31, 1999, the Company had a backlog of orders approximating
$12.8  million  ($3.9  million at December  31,  1998).  This  represents a 228%
increase  over the  backlog  in the  previous  year.  During  1999,  four of the
Company's  employees were engaged in sales activities,  and the Company utilized
manufacturers' sales representatives in certain geographic markets. In 1999, the
Company  employed two additional full time sales people for the European market.
Also  in  1999,  the  Company  expanded  its  independent  sales  representative
organization  to provide  broader  representation  primarily in the Pacific Rim.
Assisted by local  representatives,  management  intends to establish  potential
relationships  with key  managers of local  cable and  telephone  companies.  In
addition,  other  management  executives  are engaged in  negotiating  long-term
supply agreements with current and potential customers.

         Due to the  nature of the  industry,  the  Company  does not  currently
engage in extensive  advertising.  The Company promotes its products principally
through  direct  mailings and visits to  potential  customers,  distribution  of
product brochures through sales representatives and exhibiting at industry trade
shows. The Company also maintains product information on its web-site, and plans
to expand such activities in the future.

COMPETITION

         Due to the  high  demand  for the  Company's  fiber,  the  Company  has
initially  concentrated on manufacturing and selling fiber and has increased its
fiber manufacturing  capability in Jena, Germany,  and plans to further increase
capacity  through  building a new  facility  in Jena and a planned  facility  in
Malaysia. However, because competition in the production of preforms is somewhat
limited,  the Company  plans to increase its  emphasis on marketing  preforms to
that segment of the market outside the U.S. and Europe.

FIBER PREFORM

         Management  believes that there is limited  competition  in the sale of
preforms  to cable  manufacturers  who draw their own fiber.  Such  competition,
however,  is  expected to grow.  At  present,  the  competition  for  singlemode
preforms on a  worldwide  basis is limited to two United  States  manufacturers,
SpecTran  and   Alcatel.   SpecTran's   product   sales  are  for  unique  fiber
applications,   and  Alcatel  is   directly   marketing   singlemode   preforms.
Additionally, Lycom, Alcatel and Nokia, in Europe, Shin-Etsu from


                                       10
<PAGE>

Japan and DaeWoo from Korea have begun marketing singlemode preforms.

         The predominant  practice of most fiber  manufacturers is to make fiber
optic  preform  only for their  internal  use and not to sell  preform  to other
fiber-optic  manufacturers.  Management  believes these large companies will not
enter the preform market since fiber manufacturers have an inherent disincentive
in selling preforms;  they have already invested heavily in plant, equipment and
technology to convert  preforms into fiber and/or cable, and by selling preforms
they would be giving up  value-added  margins.  The Company's  customers are not
vertically integrated, and require preforms that are in limited supply.

FIBER

         The  competition  in  multimode  fiber  products  is  limited  to a few
manufacturers  in North America and Europe.  They include Corning  Incorporated,
Lucent  Technologies,  Alcatel,  SpecTran and Plasma Optical  Fiber.  Management
believes that Corning,  Lucent  Technologies,  and Alcatel  generally supply the
bulk of their  production  to their  own  cablers  or  joint  venture  partners.
Therefore,  in the U.S.,  multimode fiber will be the primary product due to the
Company's unique  technological  and cost advantage,  coupled with the fact that
the other  three large U.S.  producers  do not focus on the  multimode  fiber as
their primary business.  Furthermore,  FiberCore plans to offer several types of
multimode fibers for specific  applications  and performance  advantages such as
different  glass  composition  for  radiation  resistant  fiber  for  Government
applications,   and  special  coatings  for  high  performance   cable  designs.
Additionally, because of the Company's manufacturing flexibility, the Company is
positioned to respond quickly to special customer requirements and applications.

         The  competition in the singlemode  fiber market is much more extensive
than  in  the  preform  market  or  the  multimode  fiber  market.  Most  of the
competition for fiber comes from Corning and Lucent Technologies. Competition in
the fiber market is primarily  based on availability  and quality.  In the past,
with  some  exceptions,  the  Company's  fiber  has  been  generally  priced  at
comparable levels to fiber manufactured by the larger producers.  In the future,
FiberCore  will  concentrate  on  marketing  its new  line  of high  performance
products to support emerging  protocols,  such as Gigabit Ethernet,  as well our
ValuGrade   and   EconoGrade   line   of   products,    which   have   excellent
price/performance characteristics.

ALT PRODUCTS

         The  Company's  management  believes  there  is  limited  or no  direct
competition for its FOCMS product line except for Norscan.  Most other competing
technologies and products are more  complementary to the Company's products than
true  competitors  because these  products and the  Company's  products are both
needed to perform short range and long range fault locating.

         Numerous companies  manufacture cable protection  devices.  The Company
believes,  however,  that it has  the  only  product  approved  by  Underwriters
Laboratories, an internationally recognized certifying organization.

         Numerous companies  manufacture field talksets that enable personnel to
communicate over either twisted pair, metal sheath or optical fiber. The Company
knows of no other company that  manufactures a product that enables personnel to
communicate  over all three media,  although many  companies have or can acquire
the technology to create such a device.


                                       11
<PAGE>


                              BUSINESS (CONTINUED)

PRODUCT WARRANTIES

         Customers may obtain refunds for any defective fiber and fiber preforms
shipped by the Company within 90 days of delivery.  The Company extends one year
warranties on ALT Products.

PATENTS

         The Company is the registered owner in the United States of U.S. Patent
No. 4,596,589 relating to optical fiber fabrication.  The patent,  which expires
in 2003,  was acquired in 1993 from Gregory  Perry, a co-founder of the Company.
The  existing  patent  provides  a  more  efficient  method  for  fabricating  a
single-mode  optical fiber preform by  substantially  reducing the time and cost
required to produce the preform. The patent also provides an efficient method of
attaching  cladding  material  around a single-mode  fiber core. The Company has
filed an application in the United States and European  Common Market  improving
upon the  process  covered  by the above  patent,  and  intends to file in other
foreign  jurisdictions,  as well as filing further  improvement  patents for its
process.

         In 1997 and 1998, the Company filed two patent applications in the U.S.
for a process which the Company believes will improve the cost and efficiency of
producing  optical  fiber  preforms.  The Company is currently in the process of
preparing additional patent applications for the production of optical fiber and
preforms that are expected to be filed in 2000.

         The  Company  is the  registered  owner in the  United  States of three
patents covering its cable monitoring  systems and fault locating  methods.  The
Company acquired the first such U.S. patent, Patent No. 4,480,251,  which covers
cable monitoring  systems and expires in 2001, from Norscan.  A patent issued by
the United Kingdom for the same technology was also acquired by the Company from
Norscan. The Company has filed international  patent applications  covering this
technology in various other countries  around the world,  although none have yet
been granted.  Pursuant to the Company's agreement with Norscan, Norscan has the
right to a Canadian patent  reissuance and may otherwise use the tech- nology in
Canada.  The Company has  improved  upon  Norscan's  technology  and  obtained a
European patent and United States patent, Patent No. 5,077,526, which expires in
2008 covering the  improvements.  The Company also owns a United States  patent,
Patent No.  4,947,469  expiring in 2007, and a European  patent covering a cable
fault  location  method.  In addition,  the Company owns a United  States patent
covering the provision of backup power to optical communications systems.

         The Company's  ability to compete  effectively will depend, in part, on
its ability to protect its  patents.  There can be no  assurance  that the steps
taken by the Company to protect its  intellectual  property  will be adequate to
prevent   misappropriation   or  that  others   will  not  develop   competitive
technologies  or products.  Furthermore,  there can be no assurance  that others
will not  independently  develop  products  that are  similar or superior to the
Company's products or technologies, duplicate any of the Company's technologies,
or design around the patents  issued to the Company.  In addition,  the validity
and  enforceability of a patent can be challenged after its issuance.  While the
Company  does not believe  that its patents  infringe  upon the patents or other
proprietary  rights  of any  other  party,  other  parties  may  claim  that the
Company's  patents do infringe  upon such patents or other  proprietary  rights.
There can be no  assurance  that the Company  would be  successful  in defending
against such a claim of infringement.


                                       12
<PAGE>

                              BUSINESS (CONTINUED)

Moreover,  the expense of defending  against such a claim could be  substantial.
(See Item 3. Legal Proceedings).

INTERNATIONAL OPERATIONS

         The  Company  is  subject  to all  the  risks  of  conducting  business
internationally.  These  risks  include  unexpected  changes in  legislative  or
regulatory  requirements and fluctuations in the United States dollar, the Euro,
and the German mark, and other currencies in which the Company is doing business
from  time to  time.  The  business  and  operations  of the  Company's  Germany
subsidiary,  FCJ, are subject to the changing economic and political  conditions
prevailing  from  time to time in  Germany.  Labor  costs,  corporate  taxes and
employee  benefit  expenses are high compared to the rest of the European Union,
the United States and Japan.  FCA, the Company's  joint venture in Malaysia,  is
subject to similar  international  risks,  including  the currency  fluctuations
recently  experienced in the Pacific Rim region. The Company's  participation in
MEFC and its  investment  in FOI are  subject to the risks of doing  business in
Saudi Arabia, the Middle East and Asia in general.  These risks include, but are
not limited to, the threat of regional conflict. To date, essentially all of the
Company's revenues have come from its wholly-owned subsidiary, FCJ.

TRADEMARKS

         FCJ is the owner of the registered  trademark  InfoGlass(R) under which
it  markets  its  optical  fiber  products.  In  1997,  the  Company  filed  for
registration  of the trademarks  "EconoGrade"  and  "ValuGrade"  for products it
introduced in the market in 1998.

SEASONALITY

         The Company's business does not have strong seasonal fluctuations,  and
the Company does not expect material seasonal variations to revenue.

RAW MATERIALS

         The Company  presently  can purchase all its raw material  requirements
for its optical fiber and preform business.  The major component of a preform is
silica glass tubing  which is  available in various  sizes.  Various high purity
gases such as oxygen,  nitrogen,  argon, helium,  chlorine and chemicals such as
silicon  tetrachloride,  silicon tetra fluoride and germanium  tetrachloride are
used in the process of manufacturing preform. During 1999, the Company's optical
fiber and preform business  purchased  approximately 95% of its key glass tubing
raw material from one supplier.  This supplier accounted for over 90% and 50% of
the  Company's  glass  tube  requirements  in 1998 and 1997,  respectively.  The
supplier has committed to supply the Company's  tube  requirements  for 2000. If
the Company  becomes  unable to continue to  purchase  raw  materials  from this
supplier,  there can be no assurance that the Company will not face difficulties
in obtaining raw materials on commercially  acceptable terms, which could have a
material  adverse  effect  on the  Company.  To limit the  possiblity  of future
shortages  of key  materials,  the Company  has  successfully  identified  other
suppliers of this material. The Jena Facility has the capability


                                       13
<PAGE>

                              BUSINESS (CONTINUED)

to manufacture  the  high-purity  synthetic  core glass using a first  purchased
cladding tube, as well as adding additional  purchased  cladding tubes using the
Company's patented production process.

EMPLOYEES

         At December 31, 1999,  the Company  employed 96 persons,  of whom 3 are
executives,  13 are  engaged  in sales and  administration,  72 are  engaged  in
manufacturing and 8 are engaged principally in research and development.  Ninety
(90) of the Company's employees are located in Jena, Germany. The Company is not
party to any collective  bargaining agreements and the Company does not maintain
a pension  plan.  The Company  considers  its  relations  with  employees  to be
satisfactory  and  believes  that its  employee  turnover  does not  exceed  the
industry average.

ITEM 2.  PROPERTIES

         The Company  leases 5,000 square feet of office space as its  Corporate
Headquarters  in Charlton,  Massachusetts.  The monthly rent is $2,250,  and the
rental agreement is on a monthly basis.

         The  Company's  optical  fiber and  preform  manufacturing  facility is
located  in Jena,  Germany.  The  facility  is leased  from  SICO.  It  occupies
approximately   30,000  sq.  ft.,   including  20,700  sq.  ft.  of  clean  room
manufacturing space, 6,100 sq. ft. of office and storage space and an additional
3,200 sq. ft. of outside  facilities for gas storage tanks. The Company owns all
machinery  and equipment at the facility,  subject to certain  restrictions.  In
1999,  the term of the lease was  extended to December 31, 2001 and is renewable
for  additional   terms   aggregating  25  years.  The  monthly  lease  cost  is
approximately $24,000. The Company maintains casualty and liability insurance on
the Jena Facility.

ITEM 3.  LEGAL PROCEEDINGS

         In January  1998,  Corning,  Incorporated  ("Corning")  filed an action
against the Company  claiming  that the  Company  infringed a Corning  patent by
marketing and selling  certain  optical fiber products in the United States.  In
March 1998, the Company and Corning concluded a settlement agreement wherein the
Company  acknowledged the validity of Corning's patent and agreed,  prior to the
expiration  of the  patent,  not to  make,  market,  and  sell or  offer to sell
infringing  multimode  optical  fiber or optical  fiber  preforms  in the United
States in violation of Corning's  patent except to certain  customers.  In turn,
Corning  agreed not to seek damages and dismissed  the action.  The Company also
agreed to conduct an arbitration to determine  whether the Company's  singlemode
fiber violates the Corning  patent.  In March 1999,  the  arbitrator  issued his
opinion  concluding  that  FiberCore's  singlemode  fiber does not  violate  the
Corning patent.

         The Company's FiberCore Jena subsidiary, SICO and SICO's president, Mr.
Walter Nadrag (who was previously the Managing  Director of FiberCore  Jena) are
defendants in a lawsuit in Germany brought against them by COIA GmbH ("COIA"), a
former  customer,  claiming  damages  of  approximately  $200,000  arising  from
FiberCore  Jena's alleged failure to comply with a sales contract.  The case was

                                       14
<PAGE>

                          LEGAL PROCEEDINGS (CONTINUED)

dismissed by the lower court and COIA appealed  this  decision.  On appeal,  the
court rendered judgment in favor of the Company and the case was dismissed.

         The Company is currently in a dispute with Techman  International Corp.
("Techman")  relating to (i) certain loans made to the Company by Techman in the
aggregate  principle  amount of $418,000 plus unpaid interest in the approximate
current amount of $94,000 and (ii) the Company's investment of $500,000 in Fiber
Optic Industries  (Pakistan) Ltd. ("FOI"), a joint venture company organized and
controlled by Techman. The Company's investment in FOI is subject to a guarantee
by  Techman.  The Company  also has a dispute  relating to shares of the Company
issued to Techman,  or its principal,  M. Mahmud Awan, a former  director of the
Company.  A portion of those shares have been canceled by the Company because of
the failure of Techman to satisfy certain  conditions related to their issuance.
The parties have had periodic discussions related to the foregoing,  but to date
have not reached a resolution of these matters.  Based upon discussions with the
Company's legal counsel and their review of documents,  management believes that
Techman  breached the joint  venture  agreement  and the  guarantee and that the
Company has valid claims  against  Techman in an amount equal to or in excess of
the  amounts  of the  loans,  plus  unpaid  interest,  although  there can be no
assurance at this time as to the ultimate outcome of these disputes. The Company
intends to pursue all available remedies to resolve these disputes.

         In  addition  to the above,  the  Company is subject to various  claims
which  arise in the  ordinary  course of  business.  The Company  believes  such
claims,  individually  or in the  aggregate,  will not have a  material  adverse
affect on the business of the Company.

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

         None.







             ( The remainder of this page intentionally left blank.)



                                       15
<PAGE>
                                     PART II
                                     -------

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

         The Company's  stock is traded on the Over the Counter  (OTC)  Bulletin
Board.  There  were 209  holders of record and  approximately  2,000  beneficial
owners of Common  Stock as of March 1, 2000.  The  public  market for the Common
Stock on the Bulletin  Board,  where the stock trades under the symbol FBCE,  is
limited.  Set forth below for the periods indicated are the high and low closing
prices for the Common Stock as reported on the Bulletin Board.

STOCK PRICE AND DIVIDEND POLICY

                   Period                     High                    Low


         1999
         ----
           4th quarter                       $2.13                  $0.39
           3rd quarter                       $0.69                  $0.22
           2nd quarter                       $0.36                  $0.16
           1st quarter                       $0.50                  $0.13

         1998
         ----
           4th quarter                       $0.19                  $0.11
           3rd quarter                       $0.44                  $0.14
           2nd quarter                       $0.50                  $0.25
           1st quarter                       $0.75                  $0.29


         The  payment  of  dividends,  if  any,  in the  future  is  within  the
discretion of the Board of Directors and will depend on the Company's  earnings,
its  capital   requirements,   financial   condition,   contractual   and  legal
restrictions and other relevant factors.  Under the Tyco (AMP) November 27, 1996
Term Loan Agreement,  the Company is prohibited from paying dividends as long as
the loan remains outstanding.  The Company does not expect to declare or pay any
dividends in the foreseeable future. In addition,  the ability of the Company to
pay cash  dividends in the future will be subject to its ability to meet certain
other of its obligations.

                                       16
<PAGE>

ITEM 6.  SELECTED FINANCIAL DATA

SELECTED CONSOLIDATED FINANCIAL DATA

         The following  selected  financial  data of the Company for each of the
years  1999,  1998,  1997,  1996,  and 1995 has been  derived  from the  audited
financial statements and notes thereto of the Company and its predecessors.  The
information  set forth below is qualified by reference to, and should be read in
conjunction  with,  the  consolidated  financial  statements  and related  notes
thereto and  "Management's  Discussion  and Analysis of Financial  Condition and
Results of Operations".

<TABLE>
<CAPTION>
                                                      YEARS ENDED DECEMBER 31,
                                              (DOLLARS IN THOUSANDS EXCEPT SHARE DATA)
-----------------------------------------------------------------------------------------------------------------------------------
                                                        1999              1998             1997              1996           1995(1)
<S>                                                  <C>                <C>              <C>              <C>              <C>
Operating Data:
  Net sales.................................         $  12,126          $  8,201         $  7,078         $   8,096        $  3,094
                                                     ---------          --------         --------         ---------        --------
  Costs and expenses:
  Cost of sales.............................             9,820             6,534            5,702             7,200           4,509
  Research and development..................               722               475              434               420              75
  Selling, general, and administrative......             3,237             2,981            3,148             4,324           2,100
  Interest expense, net.....................               952               746              638               387             368
  Other (expense) income, net...............              (336)              208             (213)              102             (51)
                                                     ---------          --------         --------         ---------        --------
  Loss before provision for income taxes....            (2,941)           (2,327)          (3,057)           (4,133)         (4,009)
  Benefit (provision) for income taxes......               937               (15)             (21)               --              --
                                                     ---------          --------         --------         ---------        --------
  Net loss..................................         $  (2,004)         $ (2,342)        $ (3,078)        $  (4,133)      $  (4,009)
                                                     =========          ========         ========         =========       =========

Basic and diluted loss per share............         $   (0.05)         $  (0.07)        $  (0.09)        $   (0.13)      $   (0.15)
                                                     =========          ========         ========         =========       =========
Weighted average shares
  outstanding...............................        36,610,544        35,833,501       35,744,182        31,695,693       26,584,630
                                                    ==========        ==========       ==========        ==========       =========
Balance Sheet Data:
  Working capital (deficit).................         $   1,041          $  1,425         $  3,208         $     191       $   (277)
  Total assets..............................            24,062            25,768           26,107            17,642          14,783
  Long-term obligations.....................             9,563            10,204            9,851             4,587           5,000
  Total liabilities.........................            14,085            14,864           13,351             7,618           8,415
  Minority interest.........................             3,263             3,263            3,217                --              --
  Accumulated deficit.......................           (17,196)          (15,192)         (12,850)           (9,772)         (5,638)
  Stockholders' equity......................             6,714             7,641            9,539            10,024           6,368
</TABLE>

(1)      Includes the results of ALT from September 18, 1995.

                                       17
<PAGE>

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


                (Dollars, Deutsche Marks and Euros in Thousands)



BACKGROUND

         Certain  statements  in  this  Form  10-K  constitute  "forward-looking
statements" within the meaning of the Private  Securities  Litigation Reform Act
of 1995 (the "Reform Act"). Such  forward-looking  statements  involve known and
unknown  risks,  uncertainties,  and other  factors  which may cause the  actual
results, performance, or achievements of the Company, or industry results, to be
materially  different  from any future  results,  performance,  or  achievements
expressed or implied by such forward-looking  statements.  The important factors
that could cause actual  results to differ  materially  from those  indicated by
such  forward-looking  statements  include,  but  are  not  limited  to (i)  the
information  being of a  preliminary  nature  and  therefore  subject to further
adjustment; (ii) the ability of the Company to contain costs, to grow internally
or by acquisition and to integrate acquired  businesses into the Company's group
of  companies;  (iii)  the  uncertainties  of  litigation;  (iv)  the  Company's
dependence  on  significant  customers;  (v) changing  conditions in the optical
fiber  industry  which  could  adversely  affect the  Company's  business;  (vi)
unsettled  economic  conditions in several of the countries in which the Company
operates;   (vii)  competitive   actions  by  other  companies,   including  the
development  by  competitors  of new or  superior  services or  products,  price
reductions or the entry into the market of new competitors; (viii) all the risks
inherent in the development,  introduction,  and  implementation of new products
and services;  and other factors both referenced and not referenced in this Form
10-K.   When  used  in  this  Form  10-K,  the  words   "estimate",   "project",
"anticipate",   "expect",  "intend",  "believe",  and  similar  expressions  are
intended to identify forward-looking  statements,  and the above described risks
inherent therein.

         The Company operates  primarily  through its FiberCore Jena subsidiary.
The Company  maintains its  corporate  headquarters  in Charlton,  Massachusetts
which  is  staffed  by  executive,  research  and  engineering,  accounting  and
administrative  personnel.  The following discussion and analysis of the results
of operations is based on the Company's  audited  financial  statements  for the
years ended December 31, 1999, 1998 and 1997.

RESULTS OF OPERATIONS

         Year Ended December 31, 1999

         Net sales for the year ended  December  31,  1999 were  $3,925  greater
(47.9%)  than net sales in 1998.  The  increase  was  principally  due to a 123%
increase in volume  shipped to new and existing  customers  in 1999  compared to
1998,  offset by lower average  selling prices ranging from 15% to 33%.  Average
selling prices  decreased in the first half of 1999 compared to 1998,  primarily
due to an increase in the available supply of fiber in the market.  In addition,
the Company began selling into the North  American  market in the second half of
1999,  where average prices were slightly lower than in Europe.  This oversupply
condition  appears to have  disappeared  completely in the last quarter of 1999,
and prices have  stabilized and increased for some products.  The current demand
for the Company's products exceeds the Company's capacity,  and, therefore,  the
Company is expanding its production capacity in

                                       18
<PAGE>

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

Germany and seeking other  alternatives  to supply its customers'  requirements.
Substantially  all of the  Company's  sales are through  its German  subsidiary,
FiberCore Jena.

         Cost of  sales  increased  by  $3,286  or  50.3%  over  1998 due to the
increase  in  volume  shipped,  offset  by a  decrease  in  costs  per  unit  of
production.  This lower per unit cost is  primarily  due to improved  production
efficiencies and improved production yields resulting from process improvements.
The Company continuously invests in process development to further reduce costs.

         Gross  profit  was  $2,306  or 19.0% of net sales in 1999  compared  to
$1,667 or 20.3% of net sales in 1998. The slightly  lower margin  percentage was
due to the lower  average  selling  prices noted above,  and the higher costs of
selling into the North  American  market.  Despite these lower prices and higher
selling  costs,  the Company was able to  substantially  offset  these  declines
through  improvements  in production  efficiencies  and yields thus lowering per
unit production costs.

         Selling,  general and administrative expenses increased by $256 or 8.6%
in 1999 compared to 1998.  This increase was  principally  due to an increase in
bad debt  expense  of $242  and  higher  sales  costs  at the  Company's  German
subsidiary, offset by lower administrative costs at the parent company.

         Research and development costs increased $247 or 52% in 1999 over 1998.
The  increase  is  principally  attributable  to  the  costs  to  develop  a new
technology  for the  production  of  preform.  The  Company  believes  that this
investment will result in  substantially  lower  production costs in the future,
thus increasing profitability and maintaining the Company's competitiveness.

         Interest income increased $45 in 1999 compared to 1998 primarily due to
the increase in income from the  investments  of the DM 3,850  security  deposit
with the Berliner Bank.

         Interest expense  increased 30.9% to $1,062 in 1999 compared to $811 in
1998. This increase is attributable to the higher average balance of outstanding
loans used for  working  capital in 1999 at the  parent  company  and the higher
average  outstanding  balance in 1999 of the working  capital lines of credit at
the German subsidiary.

         Other expense-net was $336 in 1999 compared to other income-net of $208
in 1998. This change was principally due to the foreign  currency  exchange loss
of $329 on the  German  mark  deposit  with the  Berliner  Bank  that is held as
security  for the loan,  compared to a foreign  currency  exchange  gain on this
deposit in 1998. The Deutsche Mark declined in value by  approximately  14% from
the end of 1998 to the end of 1999.

         The  Company  recorded a net tax benefit of $937 in 1999 as a result of
recognizing the future tax benefit of the remaining net operating loss carryover
from the German subsidiary.  The net loss tax benefits had previously been fully
reserved;  however,  the Company's  German  subsidiary has had three  continuous
years of operating  profits and projects an operating  profit for the year 2000,
and therefore, the tax benefits of the loss carryover are more than likely to be
realized.

                                       19
<PAGE>

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

         The net loss for the year 1999 was $2,004  compared to $2,342 for 1998,
a decrease of $338 or 14.4%.  The primary cause of the decrease was the increase
in  gross  profit  and the  recognition  of the  tax  benefit  described  above,
partially  offset by the higher  administrative,  research and  development  and
interest costs.

         Year Ended December 31, 1998

         Net sales for the year ended  December  31,  1998 were  $1,123  greater
(15.9%)  than net  sales in 1997.  The  increase  was  principally  due to a 20%
increase  in volume  shipped to new and  existing  customers  in 1998 over 1997,
offset by lower average selling prices. Average selling prices decreased in 1998
compared to 1997,  primarily due to an increase in the available supply of fiber
in the market.  Substantially  all of the Company's sales are through its German
subsidiary, FiberCore Jena.

         Cost of sales increased by $832 or 15% over 1997 due to the increase in
volume shipped, offset by a decrease in costs per unit of production. This lower
per unit cost is primarily due to upgrades to the production equipment, improved
production  efficiencies and improved  production  yields resulting from process
improvements.

         Gross  profit  improved to 20.3% of net sales in 1998 from 19.4% of net
sales in 1997.  This  improvement  resulted from the production  improvements as
discussed above, offset by the lower average selling prices.

         Selling,  general and administrative expenses decreased by $167 or 5.3%
in 1998 compared to 1997. This decrease was due to lower administrative costs at
the parent company and FiberCore Jena,  offset by an increase in sales costs due
to the  addition of  personnel in the second half of 1998 and an increase in the
provision for doubtful accounts receivable at ALT.

         Research and development costs increased $41 or 9.4% in 1998 over 1997.
The increase is principally  attributable to an increase in research and process
development activities at FiberCore Jena.

         Interest  income  increased  $39 in 1998  compared  to 1997  due to the
increase in income from the  investments of the DM 3,850  security  deposit with
the Berliner Bank.

         Interest  expense  increased  22% to $811 in 1998  compared  to $664 in
1997. This increase is attributable to the higher average balance of outstanding
loans used for  working  capital in 1998 at the  parent  company  and the higher
average  outstanding balance in 1998 of the loan from the Berliner Bank used for
the expansion of the Jena  facility.  Interest of $132 on the Berliner Bank loan
was capitalized during the year for the expansion of the German plant.

                                       20
<PAGE>

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

         Other income-net was $208 in 1998 compared to other expense-net of $213
in 1997. This change was principally due to the foreign  currency  exchange gain
of $170 on the German mark deposit  with the Berliner  Bank that is security for
the loan, compared to a foreign currency exchange loss on this deposit in 1997.

         The net loss for the year 1998 was $2,342  compared to $3,078 for 1997,
a decrease of $736 or 23.9%.  The primary cause of the decrease was the increase
in gross profit and the decrease in administrative costs, offset by the increase
in interest expense and the change in other income as discussed above.


LIQUIDITY AND CAPITAL RESOURCES

         GENERAL

         The Company anticipates that the results of operations will continue to
improve  in 2000  compared  to the  losses  experienced  in  prior  years.  This
expectation is based on a projected increase in sales both in dollar amounts and
volume,  and the projected  continuing  improvement in  manufacturing  costs. In
addition,  the increase in demand in the industry  will  continue to  strengthen
selling prices, further improving the Company's profit margins.

         This expected increase in sales and improved  profitability is expected
to have a positive  impact on the  Company's  cash flow,  such that the  Company
projects  that it will have a positive cash flow from  operations  in 2000.  The
Company  will  continue  to utilize  short-term  borrowings  to fund its working
capital requirements.

         Further, the Company is planning to build a new manufacturing  facility
in Germany to replace the existing  leased  facility and to increase  production
capacity.   The  current  facility  has  limited  space  for  expansion  of  the
manufacturing operation, and the Company expects to operate at the full capacity
of this facility in 2000 to meet its sales projections. The Company is currently
seeking to raise approximately  $23,500 to construct this new plant, and expects
that this  financing  will be provided from a combination  of German  government
grants and guaranteed loans,  similar to the financing used to fund the recently
completed  expansion.  Although  management  is  optimistic,  there  can  be  no
assurance that such financing will be obtained.

         Additionally,  the Company, through its Malaysian joint-venture FCA, is
in the process of raising  approximately $25,000 in debt and equity financing to
finance the construction of the FCA  manufacturing  plant. The plan to construct
the facility in Malaysia is considered part of the Company's long-term strategy.
Notwithstanding   the  situation  in  the  Pacific  Rim  that  has  delayed  the
construction of this facility,  the region continues to invest in infrastructure
projects of which optical fiber is a part. Demand for the Company's  products is
projected to continue to grow in the Pacific Rim region at a faster rate than in
other major  markets.  Substantially  all of the products that are planned to be
produced  in the  Malaysian  facility  are  targeted  for export to the Asia and
Pacific Rim region.

         The Company is not relying on the conversion of warrants and options to
fund its operations;

                                       21
<PAGE>

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (continued)

however, if all of the outstanding warrants and options are exercised, the total
proceeds  that the Company  would  receive  upon the  exercise is  approximately
$9,368.  To the extent that the Warrants and Options are exercised,  the Company
intends to use the proceeds  from the exercise of such  Warrants and Options for
working capital purposes,  including debt service (approximately $1,170 in 2000,
excluding  revolving  credit  lines  expected  to  be  renewed,   and  including
interest).  There are long payment deferral  periods on a substantial  amount of
the Company's  outstanding  loans.  Under the Tyco Note, the remaining $2,000 in
principal  and accrued  interest  are due and payable at maturity in April 2005.
Similarly, under the $3,000 Tyco loan, payments of interest are deferred for the
first five years. Thereafter,  accrued and unpaid interest is payable quarterly.
The  principal  and any  remaining  accrued  interest  is payable at maturity on
November 27, 2006. As for the German loan,  principal is also due and payable at
the tenth anniversary of closing;  however, interest at 6.25% is paid quarterly.
Subsequent  to December  31,  1999,  certain of the options  and  warrants  were
exercised and a note was converted  into shares of the Company.  The Company may
seek to  refinance  certain of the notes due in 2000,  although  there can be no
assurance  that such  refinancing  will be  obtained.  Certain  notes are due to
officers and directors of the Company.

         The Company currently has a backlog of orders aggregating approximately
$12,800, which is scheduled to be shipped in 2000. This represents approximately
90% of the current  capacity of the Jena  facility.  The backlog at December 31,
1998 and 1997 was approximately $3,900 and $4,100, respectively. The increase in
the order backlog at December 31, 1999,  reflects the increase in demand for the
Company's products and the very tight supply situation in the industry.

         The following changes in balance sheet amounts are net of the effect of
the change in the currency exchange rates from December 31, 1998 to December 31,
1999.

Year Ended December 31, 1999

         For the year ended  December  31, 1999,  the Company used $739,  net of
depreciation  and  amortization,  for  operations  including  changes in working
capital. This was a substantial  improvement over the $1,697 used for operations
in 1998. This significant improvement was due primarily to the increase in sales
and gross profit, higher depreciation costs and other non-cash costs incurred in
1999.

         Accounts receivable increased by $1,185 due to the significant increase
in sales in 1999 compared to 1998.  Inventory  decreased by $807 also due to the
increase in sales.  Accounts payable decreased by $108 in 1999 due to a decrease
in  payables  at  the  parent  company  offset  by an  increase  at  the  German
subsidiary.  The increase at FiberCore  Jena is primarily due to the increase in
purchases of raw materials for production.  Accrued liabilities increased $98 in
1999 over 1998,  principally  due to an  increase  in accrued  interest on notes
payable.

         During 1999, the Company  invested $1,156 in fixed assets,  principally
for new  equipment  at the Jena  facility.  This was  funded  in part by $556 in
grants  from the  German  government.  Other  assets  increased  by $49 in 1999,
principally for investments in new patents.

         Notes payable  increased by $755 in 1999 over 1998,  principally due to
borrowings under the lines of credit at FiberCore Jena used for working capital,
and notes to certain officers and directors for previously unpaid salaries, fees
and expenses. The Company received $250 in proceeds from the sale of

                                       22
<PAGE>

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

common shares in 1999.  Long-term  interest payable increased by $391 due to the
increase in accrued  interest  payable on the Tyco loans wherein the interest is
payable at maturity in 2005 and 2006.

         Year Ended December 31, 1998

         For the year ended  December  31, 1998,  the Company used $607,  net of
depreciation and amortization, for operations before changes in working capital.
This was a substantial  improvement over the $1,724 used for operations in 1997.
This  significant  improvement  was due  primarily  to the increase in sales and
gross profit,  higher  depreciation  costs and other  non-cash costs incurred in
1998.

         Inventory increased by $1,187 principally due to an increase in work in
process at  year-end to provide for  planned  shipments  in January  1999 and an
increase in raw materials at year end. The build-up of raw materials at year-end
was in  anticipation  of price  increases on certain  materials  expected at the
beginning  of  1999.  Accounts  payable  decreased  by $114  in 1998  due to the
repayment  of an  advance  of  funds  to FCA  received  in 1997  from one of the
partners,  offset by an  increase  in  accounts  payable at the parent  company.
Accrued  liabilities  increased  $102 in 1998 over 1997,  principally  due to an
increase in accrued interest on outstanding notes payable.

         During 1998, the Company  invested $1,895 in fixed assets,  principally
for new  equipment  at the Jena  facility.  This was  funded  in part by $929 in
grants from the German government. Additionally, other assets increased by $205,
principally  due to an  increase  in  deferred  costs  related to the design and
development of the FCA facility.

         Notes payable  increased by $597 in 1998 over 1997,  principally due to
borrowings under the lines of credit at FCJ, used for working capital. Long-term
interest  payable  increased  by $416 due to the  increase  in accrued  interest
payable on the Tyco loans  wherein  the  interest is payable at maturity in 2005
and 2006.

         ALT

         ALT was  acquired  by the Company as of  September  18,  1995.  ALT has
historically  operated  at a  loss,  has  cumulative  losses  from  its  date of
inception,  and requires additional capital to operate. Sales of ALT products in
1999 were not significant, principally because the Company focused its available
resources  on  developing  the optical  fiber  business.  The  Company  recently
completed a revised  business  plan for ALT that  provides  for  developing  and
enhancing ALT's products and allocating  certain  resources to ALT for marketing
the products. The Company will seek to raise funds to implement this plan and is
also in  discussions  with  potential  partners  that have  interest  in the ALT
product  lines and have  expressed  an  interest  in forming a joint  venture to
manufacture  and market its  products.  The Company's  management  believes that
there is significant potential for sales of ALT's products.  This will, however,
require  funding to implement the plan,  and there can be no assurance that such
funding  will be  obtained or that a joint  venture  with new  partners  will be
consummated.

                                       23
<PAGE>

                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
            FINANCIAL CONDITION AND RESULTS OF OPERATIONS (CONTINUED)

         YEAR 2000 COMPLIANCE

         As expected, the Company did not experience any significant problems as
a result of the year 2000 issue.

         ACCOUNTING PRONOUNCEMENTS

         In June 1998, the FASB issued SFAS No. 133,  "Accounting for Derivative
Instruments and Hedging Activities", which requires that an entity recognize all
derivatives as either assets or liabilities in the  consolidated  balance sheets
and measure those  instruments at fair value. The accounting for changes in fair
value of a  derivative  depends on the intended  use of the  derivative  and its
resulting  designation.  The Company is evaluating  the effect this new standard
will have on the  Company's  financial  statements.  The  Company is required to
adopt this standard, as amended, by January 1, 2001.







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                                       24
<PAGE>

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


         The Company is exposed to market risks from changes in foreign currency
exchange rates and interest rates. The Company's principal operating subsidiary,
FiberCore Jena, is located in Germany and its functional currency is the Euro.

FOREIGN  CURRENCY  RISK.  FiberCore  Jena  may,  from  time  to  time,  purchase
short-term  forward exchange  contracts to hedge payments and/or receipts due in
currencies other than the Euro or Deutsche Mark. At December 31, 1999, FiberCore
Jena had outstanding  forward  exchange  contracts for the sale of U.S.  Dollars
totaling  $450,000 which mature at various dates in 2000.  The  weighted-average
exchange  rate in these  contracts  is  $1.0185  per Euro.  A 10%  change in the
year-end  exchange  rate could  result in a gain or loss on these  contracts  of
approximately $40,000.

         At December 31, 1999, the Company had a long-term  loan  denominated in
DM totaling DM7,700,000. The principal of the loan is due at maturity, September
2006.  Interest on the loan is payable  quarterly at the fixed rate of 6.25% per
annum. A 10% change in the DM exchange rate to the U.S. dollar could increase or
decrease the cash flow requirements of the Company by approximately  $25,000 for
each of the years 2000 through 2005, and by approximately $19,000 in 2006.

         Substantially  all  of  the  Company's  sales  are  through  it  German
subsidiary.  Additionally,  at December 31, 1999,  41% and 19% of the  Company's
assets are at its German and Malaysian subsidiaries,  respectively. The Company,
therefore,  is  subject  to  foreign  currency  translation  gains or  losses in
reporting its consolidated financial position and results of operations.

INTEREST  RATE RISK.  At December  31,  1999,  the Company  had  short-term  and
long-term  loans with interest rates based on the prime rate and LIBOR which are
adjusted  quarterly  based on the  prevailing  market rates. A 10% change in the
interest  rates on these  loans  would  have  increased  or  decreased  the 1999
interest expense by approximately $55,000.





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                                       25
<PAGE>


ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS
<TABLE>
<CAPTION>

                                                                                                       PAGE
<S>                                                                                                     <C>
Independent Auditors' Report.....................................................................       27
Consolidated Balance Sheets at December 31, 1999 and 1998........................................       28
Consolidated Statements of Operations for the Years Ended
     December 31, 1999, 1998 and 1997       .....................................................       29
Consolidated Statements of Comprehensive Income (Loss) for the Years Ended
     December 31, 1999, 1998 and 1997       .....................................................       30
Consolidated Statements of Changes in Stockholders' Equity for the Years
     Ended December 31, 1999, 1998 and 1997 .....................................................       31
Consolidated Statements of Cash Flows for the Years Ended
     December 31, 1999, 1998 and 1997............................................................       32
Notes to Consolidated Financial Statements for the Years Ended
     December 31, 1999, 1998 and 1997       .....................................................       33
</TABLE>




                                       26
<PAGE>

INDEPENDENT AUDITORS' REPORT



Board of Directors and Stockholders
FiberCore, Inc.
Charlton, Massachusetts

We have audited the accompanying  consolidated balance sheets of FiberCore, Inc.
and subsidiaries as of December 31, 1999 and 1998, and the related  consolidated
statements of operations,  comprehensive income (loss), changes in stockholders'
equity and cash flows for each of the three years in the period  ended  December
31, 1999.  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
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion,  such consolidated  financial  statements present fairly, in all
material respects, the financial position of FiberCore, Inc. and subsidiaries as
of December  31, 1999 and 1998,  and the results of their  operations  and their
cash flows for each of the three years in the period ended  December 31, 1999 in
conformity with accounting principles generally accepted in the United States of
America.


DELOITTE & TOUCHE LLP
Hartford, Connecticut
March 24, 2000


                                       27
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                           DECEMBER 31, 1999 AND 1998

(Dollars in thousands except share data)

<TABLE>
<CAPTION>
                                                                                                       1999                   1998
                                                                                                       ----                   ----
                                     ASSETS
<S>                                                                                                   <C>                   <C>
Current assets:
     Cash........................................................................................     $   487               $   150
     Accounts receivable, less allowance for doubtful accounts of $220 in 1999 and
       $200 in 1998..............................................................................       1,927                   863
     Other receivables...........................................................................          86                   579
     Inventories.................................................................................       3,047                 4,480
     Prepaid and other current assets............................................................          16                    13
                                                                                                      -------               -------
         Total current assets....................................................................       5,563                 6,085
                                                                                                      -------               -------
Property and equipment...........................................................................       7,109                 7,603
Less accumulated depreciation....................................................................       3,047                 2,373
                                                                                                      -------               -------
         Property and equipment - net............................................................       4,062                 5,230
                                                                                                      -------               -------
Other assets:
     Notes receivable from joint venture partners................................................       4,949                 4,912
     Restricted cash.............................................................................       1,981                 2,310
     Patents, less accumulated amortization of $2,838 in 1999 and $2,179 in 1998.................       4,762                 5,375
     Investments in joint ventures...............................................................       1,425                 1,425
     Deferred tax asset..........................................................................         905                    --
     Other.......................................................................................         415                   431
                                                                                                      -------               -------
         Total other assets......................................................................      14,437                14,453
                                                                                                      -------               -------
         Total assets............................................................................     $24,062               $25,768
                                                                                                      =======               =======
                      LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
     Notes payable...............................................................................     $ 2,006             $   1,665
     Accounts payable............................................................................       1,536                 1,724
     Accrued expenses............................................................................         980                 1,271
                                                                                                      -------               -------
         Total current liabilities...............................................................       4,522                 4,660
Long-term interest payable.......................................................................       1,267                   876
Long-term debt...................................................................................       8,296                 9,328
                                                                                                      -------               -------
         Total liabilities.......................................................................      14,085                14,864
                                                                                                      -------               -------
Minority interest ...............................................................................       3,263                 3,263
                                                                                                      -------               -------
Commitments and contingencies (Note 10)

Stockholders' equity:
     Preferred stock, $.001 par value, authorized 10,000,000 shares;  no shares issued
     and outstanding.............................................................................          --                    --
     Common stock, $.001 par value, authorized  100,000,000 shares; shares issued and
     outstanding:  41,404,602 in 1999 and 35,936,463 in 1998.....................................          42                    36
     Additional paid in capital..................................................................      24,874                23,337
     Accumulated deficit.........................................................................     (17,196)              (15,192)
     Accumulated other comprehensive loss:
        Accumulated translation adjustment.......................................................      (1,006)                 (540)
                                                                                                      -------               -------
         Total stockholders' equity..............................................................       6,714                 7,641
                                                                                                      -------               ------
         Total liabilities and stockholders' equity..............................................     $24,062               $25,768
                                                                                                      =======               =======
</TABLE>

          See accompanying notes to consolidated financial statements.


                                       28
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                  YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997


(Dollars in thousands except share data)

<TABLE>
<CAPTION>
                                                         1999             1998           1997
                                                         ----             ----           ----

<S>                                               <C>             <C>              <C>
Net sales ......................................  $      12,126   $       8,201    $      7,078
Cost of sales ..................................          9,820           6,534           5,702
                                                  -------------   -------------    ------------

     Gross profit ..............................          2,306           1,667           1,376

Operating expenses:
  Selling, general and administrative expenses .          3,237           2,981           3,148
  Research and development .....................            722             475             434
                                                  -------------   -------------    ------------

     Loss from operations ......................         (1,653)         (1,789)         (2,206)

Interest income ................................            110              65              26
Interest expense ...............................         (1,062)           (811)           (664)
Other (expense) income - net ...................           (336)            208            (213)
                                                  -------------  --------------    ------------
     Loss before income  taxes .................         (2,941)         (2,327)         (3,057)

 Benefit (provision) for income taxes ..........            937             (15)            (21)
                                                  -------------  --------------    ------------

     Net loss ..................................  $      (2,004) $       (2,342)   $     (3,078)
                                                  =============  ==============    ============


Basic and diluted loss per share of common stock  $      ( 0.05) $        (0.07)   $      (0.09)
                                                  =============  ==============    ============


Weighted average shares outstanding ............     36,610,544      35,833,501      35,744,182
                                                  =============  ==============    ============
</TABLE>

           See accompanying notes to consolidated inancial statements.


                                       29
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
                  YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997



(Dollars in thousands except share data)


                                               1999       1998       1997
                                               ----       ----       ----

Net loss ................................. $(2,004)   $(2,342)   $(3,078)

Other comprehensive (loss) income :
  Foreign currency translation adjustments    (466)       328     (1,084)
                                           -------    -------    -------

Comprehensive loss ....................... $(2,470)   $(2,014)   $(4,162)
                                           =======    =======    =======



          See accompanying notes to consolidated financial statements.


                                       30
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                  YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997




(Dollars in thousands except share data)
<TABLE>
<CAPTION>

                                                                   1999       1998        1997
                                                                   ----       ----        ----
<S>                                                             <C>        <C>           <C>
Common Stock:
  Balance, beginning of year ................................   $     36   $      36     $    35
  Sale of stock for cash ....................................          1
  Issuance of stock for conversion of debt ..................          5
  Stock issued on exercise of options and warrants                                             1
                                                                --------   ---------     -------
  Balance, end of year ......................................         42          36          36
                                                                --------   ---------     -------
Additional Paid in Capital:
  Balance, beginning of year ................................     23,337      23,221      19,545
  Sale of stock for cash ....................................        249
  Issuance of stock for conversion of debt ..................      1,060
  Issuance of stock options for services performed ..........         94
  Issuance of stock for investment in joint venture .........                                425
  Discount on notes for value of warrants ...................        134
  Stock issued on exercise of options and warrants ..........                     41         328
  Contribution of capital in Malaysia joint venture (FCA) ...                     75       3,348
  Stock canceled on cancellation of supply agreement with FOI                               (425)
                                                                --------   ---------     -------
  Balance, end of year ......................................     24,874      23,337      23,221
                                                                --------   ---------     -------
Accumulated Other Comprehensive (Loss) Income :
  Balance, beginning of year ................................       (540)       (868)        216
  Foreign currency translation adjustments ..................       (466)        328      (1,084)
                                                                --------   ---------     -------
  Balance, end of year ......................................     (1,006)       (540)       (868)
                                                                --------   ---------     -------
Accumulated Deficit:
  Balance, beginning of year ................................    (15,192)    (12,850)     (9,772)
  Loss for the year .........................................     (2,004)     (2,342)     (3,078)
                                                                --------    --------    --------
  Balance, end of year ......................................    (17,196)    (15,192)    (12,850)
                                                                --------    --------    --------

Total stockholder's equity ..................................   $  6,714    $  7,641    $  9,539
                                                                ========    ========    ========
</TABLE>


           See accompanying notes to consolidated financial statements



                                       31
<PAGE>


                        FIBERCORE, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                  Years Ended December 31, 1999, 1998, and 1997



(Dollars in thousands except share data)
<TABLE>
<CAPTION>
                                                         1999        1998       1997
                                                         ----        ----       ----
<S>                                                     <C>        <C>        <C>
Cash flows from operating activities:
  Net loss ..........................................   $(2,004)   $(2,342)   $(3,078)
Adjustments to reconcile net loss to net cash used in
  operating activities:
  Issuance of stock options for services performed ..        94
  Depreciation and amortization .....................     1,932      1,735      1,354
  Deferred income tax benefit .......................      (952)
  Foreign currency translation loss and other .......       209         20        319
Changes in assets and liabilities:
  Accounts receivable ...............................    (1,185)       (31)      (354)
  Other receivables .................................       411         30       (202)
  Inventories .......................................       807     (1,187)    (1,398)
  Prepaid and other current assets ..................       (41)        90         (6)
  Accounts payable ..................................      (108)      (114)       260
  Accrued expenses ..................................        98        102         37
                                                        -------    -------    -------
      Net cash used in operating activities .........      (739)    (1,697)    (3,068)
                                                        -------    -------    -------
Cash flows from investing activities:
  Purchases of property and equipment ...............    (1,156)    (1,895)    (4,211)
  Reimbursement from government grant ...............       556        929      1,775
  Other .............................................       (49)      (205)      (115)
                                                        -------    -------    -------
      Net cash used in investing activities .........      (649)    (1,171)    (2,551)
                                                        -------    -------    -------
Cash flows from financing activities:
  Cash contribution by minority shareholders
      in FCA ........................................                           1,683
  Proceeds from issuance of common stock ............       250         41        328
  Proceeds from long-term debt ......................                           4,750
  Proceeds from notes payable .......................       755        597        394
  Repayment of notes payable ........................                  (37)
  Increase in long-term interest payable ............       391        416        418
                                                        -------    -------    -------
      Net cash provided by financing activities .....     1,396      1,017      7,573
                                                        -------    -------    -------
Effect of foreign exchange rate change on cash ......       329       (127)       (16)
                                                        -------    -------    -------
Increase (decrease) in cash .........................       337     (1,978)     1,938
Cash, beginning of year .............................       150      2,128        190
                                                        -------    -------    -------
Cash, end of year ...................................   $   487    $   150    $ 2,128
                                                        =======    =======    =======
Supplemental disclosure:
      Cash paid during the year for interest ........   $   310    $   274    $   222
      Shares issued for investment in joint venture .        --         --    $   425
      Shares issued for conversion of debt ..........   $ 1,065         --         --
</TABLE>


          See accompanying notes to consolidated financial statements.


                                       32
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(1)      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a)      Incorporation and nature of operations

FiberCore,  Inc.  (the  "Company")  is  involved in the  research,  development,
production  and  sale of  optical  fiber  and  optical  fiber  preforms  for the
telecommunications   industry.   FiberCore  Jena  GmbH  ("FCJ"),  the  Company's
principal operating  subsidiary located in Germany,  manufactures  optical fiber
and optical fiber  preforms.  Automated  Light  Technologies,  Inc.  ("ALT"),  a
wholly-owned  subsidiary of the Company,  is a manufacturer  and  distributor of
fiber   optic   cable   monitoring   and   fault   locating   systems   for  the
telecommunications industry. FiberCore Asia Sdn. Bhd. ("FCA") was formed in 1997
to construct an optical-fiber  manufacturing  facility in Malaysia.  The Company
reports as a single segment enterprise.

In  January  1997,  the  Company  registered  the  resale  of all  of  its  then
outstanding  shares  under  an S-1  filing  with  the  Securities  and  Exchange
Commission.   The   Company's   common   stock   is   traded   on   the   Nasdaq
Over-The-Counter-Bulletin Board under the symbol "FBCE".

(b)      Use of estimates in the preparation of financial statements

The preparation of financial statements in conformity with accounting principles
generally  accepted in the United States of America requires  management to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and 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.

(c)      Principles of consolidation

The consolidated  financial  statements  include the accounts of the Company and
its majority-owned subsidiaries. All intercompany balances and transactions have
been eliminated in consolidation.

(d)      Inventories

Inventories  are  valued  at the lower of cost or  market  using  the  first-in,
first-out method.

(e)      Property and equipment

Property and equipment is stated at cost, net of grants  received  applicable to
acquisitions.  The cost of  maintenance  and  repairs  is  charged to expense as
incurred.  Expenditures  for significant  renewals or improvements to properties
and equipment are added to the basis of the asset.


                                       33
<PAGE>


                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)

(1)      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

Property and equipment is depreciated  using the  straight-line  method over the
estimated useful lives of the assets.

(f)      Restricted Cash

In connection  with the expansion of the FCJ  facility,  the Company  obtained a
loan from the Berliner Bank in Germany. Cash in the amount of German marks 3,850
(approximately  U.S. $1,981 at December 31, 1999),  has been deposited with this
institution as collateral for this loan.

(g)      Patents

Patents are amortized on a straight-line basis over seventeen years. The Company
evaluates the recoverability of patents from expected future cash flows.

(h)      Investments in joint ventures

The Company holds a 51% ownership in FCA, which is consolidated in the financial
statements.  Minority  interest  on the balance  sheet  reflects  the  Malaysian
partners' 49% ownership.

The  Company's  15%  ownership  interest in Middle East Optical  Fiber Cable Co.
("MEFC") is carried at cost of $925.

The Company has a 30% ownership  interest in Fiber Optic Industries  (Pvt.) Ltd.
("FOI"). FOI is inactive.

(i)      Fair value of financial instruments

The  Company  has  financial  instruments,  which  consist  of cash,  short-term
receivables,  accounts  payable  and notes  payable,  for which  their  carrying
amounts approximate fair value due to the short maturity of those instruments.

The principal amount of the long-term debt  approximates  fair value because the
interest rates on these instruments approximate current market rates.

(j)      Translation of foreign currencies

The translation of foreign  subsidiaries  financial statements into U.S. dollars
is performed for balance sheet accounts  using current  exchange rates in effect
at the balance sheet date and for revenue and expense

                                       34
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(1).     SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED):

accounts  using an average  exchange  rate for the period.  Unrealized  gains or
losses resulting from translation are included in stockholders'  equity as other
comprehensive income (loss).

(k)      Revenue

Revenue is  recognized  when  earned  which is  principally  when  products  are
shipped.

(l)      Research and Development

Research and development costs are expensed as incurred.

(m)      Income taxes

The Company accounts for income taxes in accordance with the asset and liability
method.   Deferred  taxes  are  recognized  for  the  future  tax   consequences
attributable  to the  differences  between  the book and tax basis of assets and
liabilities.

(n)      Loss per share of common stock

Basic loss per share of common stock is computed  based on the weighted  average
shares  outstanding  during  the year.  The stock  purchase  warrants  and stock
options have not been included in the  computation of basic loss per share since
the effect would be anti-dilutive.

(o)      Stock-based compensation

FASB Statement No. 123 "Accounting for Stock-Based  Compensation" defines a fair
value based method of accounting  for an employee stock option or similar equity
instrument.  However, the Company will continue to measure compensation cost for
employee stock compensation  transactions using the intrinsic value based method
of accounting  prescribed by APB Opinion No. 25 "Accounting  for Stock Issued to
Employees" as permitted under FASB 123.

(p)      Reclassifications

Certain amounts in the prior year financial statements have been reclassified to
conform to the 1999 presentation.

(2)      EARNINGS PER SHARE

Basic  earnings  per share  ("EPS") is based on the weighted  average  number of
common  shares  outstanding,  excluding  common stock  equivalents.  Diluted EPS
reflects the  potential  dilution of EPS that could occur if securities or other
contracts to issue common shares were exercised or converted.


                                       35
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(2)      EARNINGS PER SHARE (CONTINUED):

For the years ended  December 31, 1999,  1998 and 1997,  there is no  difference
between basic and diluted earnings per share due to the losses of the Company.

The following table shows  securities  outstanding as of December 31, that could
potentially  dilute  basic  EPS in the  future  that  were not  included  in the
computation of diluted EPS because to do so would have been antidilutive.

                                      1999         1998         1997
                                   ----------   ----------   ----------

Employee stock options              6,073,151    2,020,225    1,387,778
Warrants to acquire common stock    5,190,613    4,903,185    4,968,818
Common stock to be issued for
    convertible debt                5,616,699    4,927,232    2,060,308
                                   ----------   ----------    ---------
         Total                     16,880,463   11,850,642    8,416,904
                                   ==========   ==========    =========


(3)      ACQUISITIONS AND STRATEGIC INVESTMENTS

In November  1997,  the Company  entered  into a  joint-venture  agreement  with
Federal Power Sdn. Bhd. ("FDP") and PNB Equity Resource  Corporation ("PERC") to
form  FiberCore  Asia Sdn.  Bhd.  ("FCA") in Malaysia.  FCA was  established  to
construct  and  operate an  optical  fiber  preform  manufacturing  facility  in
Malaysia.  The  Company  owns  51% of FCA,  and FDP and  PERC  own 37% and  12%,
respectively.

The Company  granted FCA a license to use the  Company's  technology in exchange
for the  Company's  ownership  interest,  and FDP and PERC  contributed  cash of
$1,683 and notes of $4,949 for their ownership  interests.  As part of the joint
venture agreement,  the Company has entered into a put option agreement with FDP
and PERC wherein the Company has agreed to purchase FDP's and PERC's shares,  at
their option, in the event that certain production  benchmarks are not achieved.
The Company also entered into a support  contract with FCA to provide design and
construction management for the facility,  marketing services and administrative
support  services.  Due to the recent  economic  situation  in Malaysia  and the
Pacific Rim the debt  financing  required for the project has not, as yet,  been
obtained.  The Company and the other  shareholders in FCA are continuing to seek
alternative financing and additional equity partners for FCA.

In April 1995, the Board of Directors ratified actions by FiberCore Incorporated
to enter  into a joint  venture  with  John  Royle & Sons Co.  and  Middle  East
Specialized  Cables  Company  ("MESC")  for a period  of 15 years to be known as
Middle East Fiber Cables Co. ("MEFC").  The Company has a 15% ownership interest
in the joint venture.  MEFC constructed its  manufacturing  facility in 1996 and
1997 and began operations in 1998. The Company is a co-guarantor  with the other
joint venture partners for


                                       36
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(3)      ACQUISITIONS AND STRATEGIC INVESTMENTS (CONTINUED):

certain credit facilities provided by banks to MEFC. These credit facilities are
also collateralized by the assets of MEFC. At December 31, 1999, the Company was
contingently liable for these loans in the amount of $792.

On  January  11,  1996,  as part  of a share  purchase  agreement  with  Techman
International  Corporation  ("Techman"),  a related  party,  a joint venture was
established between the Company and Techman. The joint venture,  FOI, is located
in Pakistan.  The Company has a 30% ownership interest in FOI. FOI was formed in
1996 and has had no significant operations since its formation.

The Company believes that Techman,  which guaranteed the Company's investment in
FOI,  has  breached  its  obligations  under the joint  venture  agreement  and,
therefore,  the  Company is  pursuing  actions to recover  its  investment  (see
Commitments and Contingencies).

(4)      RECEIVABLES

Activity in the allowance for doubtful  accounts  consisted of the following for
the years ended December 31:

                                                   1999     1998    1997
                                                  -----    -----   -----

Balance at beginning of period................   $ 200    $  33   $  36
Additions charged to expense .................     409      167      --
Deductions ...................................    (389)      --      (3)
                                                 -----    -----   -----

Balance at end of period .....................   $ 220    $ 200   $  33
                                                 =====    =====   =====

Other receivables consist of the following at December 31:

                                                  1999     1998     1997
                                                  ----     ----     ----

German government grants.......................  $ --     $419     $423
Value added tax ...............................    32       99      112
Other .........................................    54       61       29
                                                 ----     ----     ----
         Total ................................  $ 86     $579     $564
                                                 ====     ====     ====



                                       37
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)

(5)      INVENTORIES

Inventories consist of the following at December 31:


                                                 1999     1998
                                                ------   ------

Raw materials ...............................  $1,745   $1,545
Work-in-process..............................     361    1,161
Finished goods...............................     941    1,774
                                               ------   ------
         Total...............................  $3,047   $4,480
                                               ======   ======



(6)    PROPERTY AND EQUIPMENT

Property and equipment consist of the following at December 31:

                                ESTIMATED
                              USEFUL LIVES            1999         1998
                              ------------            ----         ----

Office equipment ...........   2-5 years          $    360    $    315
Machinery and equipment ....   2-12 years            9,303       9,899
Furniture and fixtures .....   5-7 years                21          21
Leasehold improvements .....   3-10 years              380         395
Construction in progress ...                           803         706
                                                  --------    --------
                                                    10,867      11,336
Less grant proceeds received                        (3,758)     (3,733)
                                                  --------    --------
         Total .............                      $  7,109    $  7,603
                                                  ========    ========

Depreciation  on property and  equipment  charged to expense was $1,058 in 1999,
$928 in 1998, and $560 in 1997.  During 1998 and 1997,  the Company  capitalized
interest  costs of $132 and $178,  respectively,  on the  expansion  project  at
FiberCore Jena. The project was substantially completed in 1998, and, therefore,
no interest was capitalized in 1999.

(7)      ACCRUED EXPENSES

Accrued expenses consist of the following at December 31:


                                                     1999     1998
                                                   ------   ------

Accrued wages, benefits & taxes................   $  398   $  457
Accrued interest ..............................      198      218
Accrued legal and audit .......................      140       39
Other .........................................      244      557
                                                  ------   ------
         Total ................................   $  980   $1,271
                                                  ======   ======


                                       38
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(8)      NOTES PAYABLE

Notes payable consist of the following at December 31:

<TABLE>
<CAPTION>
                                                                                      1999       1998
                                                                                   -------    -------
<S>                                                                                <C>        <C>
Convertible  note payable to an officer of the Company with interest at 8.0% per
year, due December 31, 2000, convertible into common shares
of the Company at $0.25 per share ..............................................   $   192    $    --

Convertible  note payable to an officer of the Company with interest at 8.0% per
year, due December 31, 2000, convertible into common shares
of the Company at $0.25 per share ..............................................       119         --

Note payable to shareholder with interest at prime plus 1% (9.25% at
December 31, 1999), due March 6, 2000  .........................................       220         --

Note payable to Techman International Corporation with interest at prime
plus 1%, due April 16, 2000. (see Commitments and Contingencies) ...............       250         --

Note payable to Techman International Corporation with interest at
prime plus 1% due December 31, 1999. (see Commitments and Contingencies) .......       168        150

Note payable to an officer of the Company, interest at prime plus 1%,
due September 17, 2000  ........................................................        50         50

Convertible  note payable with interest at 8.0% per year, due December 31, 2000,
convertible into common shares of the Company
at $0.25 per share. A director of the Company controls the lender .............        181         --

Convertible  notes  payable to the  spouses of  officers  of the  Company,  with
interest at prime plus 1% (9.25% at December 31, 1998), due
September 31, 2000  ............................................................        --        500

Convertible  note  payable  to a  director,  interest  at the prime rate plus 1%
(9.25%,  at December 31, 1998) with  principal  and interest due  September  30,
1999, all principal and accrued interest, if any, convertible
into common stock of the Company at approximately $.1875 per share .............        --        249

Amounts outstanding under revolving lines of credit from banks with
interest at 8.0%  ..............................................................       859        716

Discount attributable to warrants issued in conjunction with notes .............       (33)        --
                                                                                   -------    -------

                  Total ........................................................   $ 2,006    $ 1,665
                                                                                   =======    =======
</TABLE>

                                       39
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(8)      NOTES PAYABLE (CONTINUED)

In conjunction  with certain of the notes,  the Company issued to the lenders in
1999 an additional  812,425 warrants to purchase common shares of the Company at
exercise  prices of $0.25 and $0.26 per share,  the closing  market price at the
dates  of  issue.  The fair  value of the  warrants  has been  recorded  as debt
discount. Related party interest expense on notes payable was $90, $91, and $91,
in 1999, 1998 and 1997, respectively.

In 1999, the $500 in notes plus accrued interest due the spouses of the officers
were  converted  into  2,543,352  shares of the  Company  and the $249 note plus
accrued interest due a director was converted into 1,488,243 shares,  consistent
with the terms of the note.  Subsequent to December 31, 1999, the $220 note plus
accrued  interest due March 6, 2000 was  converted  into  249,220  shares of the
Company.

The Company's  subsidiary,  FiberCore Jena,  maintains two lines of credit of DM
1,000 (approximately US $514) each with German banks. The notes bear interest at
8% per year.  Interest  expense on amounts drawn under these notes was $51, $29,
and $3 in 1999,  1998 and  1997,  respectively.  One of the  lines of  credit is
collateralized by the inventory of FiberCore Jena.


All of the proceeds of the notes were used for working capital.









                     (This space intentionally left blank.)








                                       40
<PAGE>


                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(9)      LONG-TERM DEBT
<TABLE>
<CAPTION>


Long-term debt consists of the following at December 31:               .           1999       1998
                                                                                   ----       ----
<S>                                                                               <C>        <C>
Note payable to Berliner Bank, interest at 6.25%, due September 30, 2006          $ 3,962    $ 4,621

Convertible note payable to Tyco Electronics Corp. (formerly AMP, Incorporated)
interest at 3-month London Interbank Offered Rate plus one percent
 (6.40% at December 31, 1999), due April 17, 2005                                   2,000      2,000

Note payable to Tyco, interest at prime plus one percent (9.25% at December
31, 1999), due November 27, 2006                                                    3,000      3,000

Discount attributable to warrants issued in conjunction with the $3,000
note above                                                                           (666)      (763)

Note payable to shareholder with interest at prime
plus 1% due March 6, 2000. (see notes payable)                                         --        220

Note payable to Techman International Corporation with interest at prime
plus 1% (9.25% at December 31, 1998), due April 16, 2000. (see notes payable)          --        250
                                                                                  -------    -------
                  Total                                                           $ 8,296    $ 9,328
                                                                                  =======    =======
</TABLE>

During the year ended  December  31,  1997,  the Company  drew down 7,700 German
marks (approximately  U.S.$3,962) under a loan agreement with the Berliner Bank.
The proceeds were used to fund the expansion of the Company's  plant in Germany.
The loan bears  interest at 6.25% annually and is due on September 30, 2006. The
loan is collateralized by a deposit with the bank of approximately $1,981.

In  April  1995,  FiberCore  Incorporated  issued  to  Tyco,  a  floating  rate,
collateralized,  ten year debenture in the amount of $5,000, due April 17, 2005,
with interest,  at an annualized rate adjusted  quarterly,  equal to the 3-month
London Interbank  Offered Rate plus 1%, (6.4% at December 31, 1999). No interest
is due  until  the  earlier  of:  Tyco  conversion  of debt to  stock,  a public
financing  by the  Company  which  gives  Tyco the  right to call the  loan,  or
maturity.  On November 27, 1996, Tyco converted  $3,000 of principal and $541 of
accrued  interest  relating  to the  original  $5,000 ten year  debenture,  into
3,058,833   shares  of  common  stock  of  the  Company.   The  Tyco  notes  are
collateralized by the Company's patents, patent applications,  licenses,  rights
and  royalties  resulting  from  such  patents  and the  equipment  of FCJ.  The
remaining  principal  balance  remained  subject  to the  terms of the  original
debenture  agreement and is convertible  into shares of the Company at $0.66 per
share.

                                       41
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(9)      LONG-TERM DEBT (CONTINUED):

As an additional  part of this  agreement,  on November 27, 1996, Tyco issued to
the Company  $3,000 under a ten-year  note,  secured by  equipment  owned by the
Company,  with interest at prime plus one percent  (9.25% at December 31, 1999).
Terms of the debenture  state that interest shall be accrued,  but not paid, for
the first five years of the loan and a portion of the  proceeds  are required to
be used as  collateral  for the German  bank loan for the  expansion  of its FCJ
facility.  The  principal  will become due before the maturity date if the major
financing  is repaid or the  collateral  is  released  by the  German  financial
institution.

In conjunction with the $3,000 note above, Tyco was issued five-year warrants to
acquire  2,765,487  shares  of the  Company's  stock  at an  exercise  price  of
approximately  $0.72 per  share.  Interest  expense  on the Tyco notes was $391,
$416,  and  $418,  for the  years  ended  December  31,  1999,  1998  and  1997,
respectively.

The Berliner Bank loan and the Tyco Note  agreements contain  certain  financial
ratio covenants.  At December 31, 1999, the Company was in compliance with these
covenants.

Scheduled  principal  maturities of long-term debt,  excluding $666 of discounts
attributable to warrants, are as follows at December 31, 1999:


         2005...............................           $  2,000
         2006...............................              6,962
                                                       --------
                           Total............           $  8,962
                                                       ========

(10)     COMMITMENTS AND CONTINGENCIES

The Company and its subsidiaries have entered into various leases for its office
and  production  space.  The  Company's  office lease is on a monthly basis at a
monthly  rental of $2.  FCJ  conducts  its  operations  from  premises  under an
operating lease with SICO Quarzschmelze  Jena GmbH ("SICO").  The lease provides
for fixed monthly rental  payments of $24 through its expiration on December 31,
2001, and is renewable for up to 25 years.

Future minimum lease payments under noncancelable operating leases (with minimum
or remaining lease terms in excess of one year) are as follows:

         FISCAL YEAR ENDING DECEMBER 31,                            AMOUNT
         -------------------------------                            ------
         2000.................................................      $  355
         2001.................................................         340
         2002.................................................          13
         2003 ................................................           9
                                                                    ------
                  Total.......................................      $  717
                                                                    ======

Included in the  statements of operations for the years ended December 31, 1999,
1998 and 1997 is rent expense of $384, $372 and $411, respectively.

                                       42
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(10)     COMMITMENTS AND CONTINGENCIES (CONTINUED):

         The Company is currently in a dispute with Techman  International Corp.
("Techman")  relating to (i) certain loans made to the Company by Techman in the
aggregate  principle  amount of $418,  plus unpaid  interest in the  approximate
current  amount of $94 and (ii) the Company's  investment of $500 in Fiber Optic
Industries  (Pakistan)  Ltd.  ("FOI"),  a company  organized  and  controlled by
Techman.  The Company's  investment in FOI is subject to a guarantee by Techman.
The  Company  also has a dispute  relating  to shares of the  Company  issued to
Techman,  and M. Mahmud  Awan, a former  director of the  Company.  A portion of
those shares have been canceled by the Company because of the failure of Techman
to satisfy certain  conditions  related to their issuance.  The parties have had
periodic  discussions  related to the foregoing,  but to date have not reached a
resolution of these matters.  Based upon  discussions  with the Company's  legal
counsel and their  review of  documents,  management  believes  that Techman has
breached the joint venture agreement and the guarantee and the Company has valid
claims against  Techman in an amount equal to or in excess of the amounts of the
loans, plus unpaid interest,  although there can be no assurance at this time as
to the ultimate  outcome of these  disputes.  The Company  intends to pursue all
available remedies to resolve these disputes.

In January 1998, Corning,  Incorporated  ("Corning") filed an action against the
Company  claiming that the Company  infringed a Corning  patent by marketing and
selling certain optical fiber products in the United States.  In March 1998, the
Company and Corning  concluded a  settlement  agreement  wherein the Company has
acknowledged  the  validity  of  Corning's  patent  and  agreed,  prior  to  the
expiration  of the  patent,  not to  make,  market,  and  sell or  offer to sell
infringing  multimode  optical  fiber or optical  fiber  preforms  in the United
States in violation of Corning's patent,  except to certain customers.  In turn,
Corning  agreed not to seek damages and has  dismissed  the action.  The Company
also  agreed to  conduct an  arbitration  to  determine  whether  the  Company's
singlemode  fiber  violates the Corning  patent.  In March 1999,  the arbitrator
issued an opinion concluding that FiberCore's  singlemode fiber does not violate
the Corning patent.

The Company's FiberCore Jena subsidiary,  SICO and SICO's president,  Mr. Walter
Nadrag  (who was  previously  the  Managing  Director  of  FiberCore  Jena)  are
defendants in a lawsuit in Germany brought against them by COIA GmbH ("COIA"), a
former customer,  claiming damages of approximately  $200 arising from FiberCore
Jena's  alleged  failure to comply  with a sales  contract.  On appeal the court
rendered judgement for the Company and the case was dismissed.

ALT is  contingently  liable for  certain  debt of a former  subsidiary,  Allied
Controls, Inc. ("Allied"), approximating $579.

The Company is a co-guarantor  with the other joint venture partners for certain
credit  facilities  provided by banks to MEFC. These credit  facilities are also
collateralized  by the assets of MEFC.  At  December  31,  1999 the  Company was
contingently liable for these loans in the amount of $792.

In addition to the above,  the Company is subject to various  claims which arise
in  the  ordinary  course  of  business.   The  Company  believes  such  claims,
individually or in the aggregate, will not have a material adverse effect on the
financial position or results of operations of the Company.

                                       43
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)

(11)     STOCKHOLDERS' EQUITY

The following  represents  the stock option  activity,  price range and weighted
average price during the three years ended December 31, 1999.

<TABLE>
<CAPTION>
                                                                                  WEIGHTED
                                                NUMBER OF      EXERCISE           AVERAGE
                                                 SHARES       PRICE RANGE         EXERCISE
                                                ------       -----------          -------
<S>                                              <C>        <C>                  <C>
Outstanding at December 31, 1996                 978,434    $0.003-$2.00         $0.98
Granted in 1997                                  709,500    $ 1.16-$1.58         $1.40
Exercised in 1997                               (300,156)   $0.003-$1.36         $0.39
---------------------------------------------------------------------------------------------
Outstanding at December 31, 1997               1,387,778    $0.003-$2.00         $1.32
Granted in 1998                                  695,703    $0.1875              $0.1875
Exercised in 1998                                (63,256)   $0.003-$2.00         $0.84
---------------------------------------------------------------------------------------------
Outstanding at December 31, 1998               2,020,225    $0.003-$1.58         $0.95
Granted in 1999                                4,052,926    $0.1875-$2.125       $0.49
Exercised in 1999                                     --    --                   --
---------------------------------------------------------------------------------------------
Outstanding at  December 31, 1999              6,073,151    $0.003-$2.125        $0.641
=============================================================================================
        At December 31, 1999:
             Exercisable                       3,770,128    $0.003-$1.58         $0.61
             Not Exercisable                   2,303,023    $0.003-$2.125        $0.70
</TABLE>

Options vest at various dates,  generally  over the  three-year  period from the
date of the grant.  The  options  granted in 1999 and 1998 expire ten (10) years
from the grant date. Options granted prior to 1998 have no expiration date.

A summary of the status of the  Company's  stock  options and  weighted  average
prices at December 31, 1999 are as follows:

<TABLE>
<CAPTION>
                                                      Weighted                                       Weighted
                                                      Average                                        Average
                 Range of              Options        Exercise      Remaining         Options        Exercise
              Exercise Price         Outstanding       Price          Years         Exercisable       Price
              --------------         -----------       -----          -----         -----------       -----
            <S>                           <C>        <C>               <C>              <C>            <C>
            $0.003                        36,713     $  0.003           *              36,713         $.003
            $0.1875 - $0.5625          4,193,629     $   0.22           9           2,445,606         $0.21
            $0.68 - $1.16                441,740     $   1.10           *             441,740         $1.10
            $1.43 - $1.58                846,069     $   1.52           *             846,069         $1.52
            $2.125                       555,000     $  2.125          10                  --            --
                                       ---------      -------                        ---------        -----
            $.003 - $2.125             6,073,151     $   0.64                        3,770,128        $0.61
                                       =========     ========                        =========        =====
</TABLE>

           * Options granted and exercisable have no expiration date.

                                       44
<PAGE>



                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(11)     STOCKHOLDERS 'EQUITY (continued)

The  Company  applies APB Opinion 25 in  accounting  for its stock  compensation
plans. Had compensation cost been determined on the basis of fair value pursuant
to FASB  Statement  No.  123,  net loss and loss per  share  would  have been as
follows:




                                         1999            1998            1997
                                         ----            ----            ----
Net loss
  As reported                          $(2,004)        $(2,342)        $(3,078)
                                       =======         =======         =======
  Pro forma                            $(2,230)        $(2,391)        $(3,174)
                                       =======         =======         =======

Basic and diluted loss per share
  As reported                         $ ( 0.05)        $ (0.07)        $ (0.09)
                                      ========         =======         =======
  Pro forma                           $ ( 0.06)        $ (0.07)        $ (0.09)
                                      ========         =======         =======

The weighted  average fair value of options  granted during 1999,  1998 and 1997
was $0.29, $0.07 and $0.14 per share, respectively.

The fair value of each option  granted is  estimated on the grant date using the
Black-Scholes  model.  The following  assumptions  were made in estimating  fair
value:


                                  Stock
Assumptions                       Plan
-----------                       ----

Dividend yield                    --
Risk-free interest rate           5.5%
Expected life                     10 years in 1999 and 2 years in 1998 and 1997
Expected volatility               50% in 1999, 50% in 1998 and 20% in 1997




                                       45
<PAGE>


                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)

(11)     STOCKHOLDERS' EQUITY (CONTINUED)


At December  31,  1999 there were  outstanding  warrants  to purchase  5,190,613
common shares at exercise  prices ranging from $0.19 to $1.53 per share.  Of the
warrants outstanding, 1,503,884 were held by certain officers of the Company and
their  spouses,  249,074 by a director  of the  Company,  2,765,487  by Tyco and
255,676 by One Financial Group Incorporated, a company controlled by a director.

The  warrants are  exercisable  from the date of the grant and expire at various
dates to October 2004.

(12)     INCOME TAXES

The benefit (provision) for income taxes consists of the following components:



                                            1999     1998         1997
                                            ----     ----         ----
Current:
         State                           $ (15)   $  (15)     $   (21)
                                        -------     ------      ------
         Total Current:                    (15)      (15)         (21)
                                        -------     ------      ------
Deferred:
         International                     952         --           --
                                        -------     ------      ------
         Total Deferred                    952         --           --
                                        -------     ------      ------
Total                                   $  937     $  (15)     $   (21)
                                        =======     ======      ======


The significant components of the net deferred tax asset as of December 31, 1999
and 1998 were as follows:
                                          1999      1998
                                          ----      ----

Net operating loss carry forwards      $  5,699   $ 4,456
Less valuation allowance                 (4,794)   (4,456)
                                       --------   -------
Net deferred tax asset                 $    905   $     0
                                       ========   =======


The  liability  method of  accounting  for  deferred  income  taxes  requires  a
valuation  allowance  against  deferred  tax assets  if,  based on the weight of
available evidence,  it is more likely than not that some or all of the deferred
tax assets will not be realized. During 1999, the Company reversed the valuation
allowance  attributable  to the net deferred tax asset  applicable  to FiberCore
Jena GmbH.  This resulted in an income tax benefit of $952.  FiberCore  Jena has
had  operating  profits  for  the  years  1997 to 1999  and  projects  continued
profitability in 2000 and, therefore, it is probable that the deferred tax asset
will be realized.  The net deferred tax asset  applicable to FiberCore,  Inc. is
fully reserved.  The total valuation allowance increased $338, $769, and $1,000,
in 1999, 1998, and 1997, respectively.

                                       46
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(12)     INCOME  TAXES (continued)


The Company has net operating  loss carry  forwards  available of  approximately
$11,985 at December  31, 1999 for federal and state tax  purposes.  As a result,
there is no federal  income tax expense for the years 1999,  1998, and 1997. The
majority  of the net  operating  loss  carry  forwards  expire in the years 2009
through 2019.

FCJ has net operating loss carry forwards at December 31, 1999 of  approximately
$1,978 for corporation  tax and $711 for trade income tax purposes  available to
offset future  taxable  income.  Under German tax law, the losses can be carried
forward indefinitely.

In addition, ALT has pre-acquisition net operating loss carry forwards available
of  approximately  $4,278,  at  December  31,  1999 for  federal  and  state tax
purposes. The loss carry forwards expire between the years 2001 and 2010.


(13)     MAJOR CUSTOMERS

The  approximate net product sales by the Company to its major customers and the
related percentages are as follows:


         CUSTOMER                1999           1998             1997
         --------                ----           ----             ----
                             AMOUNT    %     AMOUNT    %     AMOUNT   %
                             ------    -     ------    -     ------   -

            A               $2,900    24    $1,859    23     $2,990   42
            B                2,527    21     1,801    22      1,238   17
            C                1,196    10     1,107    13         --   --
            D                1,158    10        --    --         --   --
            E                 636      5       832    10         --   --


The Company  purchases  raw materials  from various  suppliers and in some cases
there are a limited number of suppliers for certain materials. In 1999, 1998 and
1997,  one  supplier  accounted  for 95%,  90%,  and 50%,  respectively,  of the
Company's  requirement of one particular item.  Although the Company maintains a
good  relationship  with this  supplier,  the loss of this supplier could have a
material  impact on the Company's  ability to manufacture its required volume of
product.  The Company has identified  alternative  sources for this material and
continues to seek alternative sources of supply.

                                       47
<PAGE>

                        FIBERCORE, INC. AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(13)     MAJOR  CUSTOMERS  (CONTINUED)

The major  customers  listed below  accounted  for  approximately  the following
amounts and related  percentages of the trade accounts receivable balance of the
Company at December 31:


                                          1999                 1998
                                          ----                 ----


                    CUSTOMER        AMOUNT      %        AMOUNT       %
                    --------        ------      -        ------       -

                       A           $ 472       24        $   0        0
                       B           $ 669       34        $ 120       14
                       C               0        0        $ 212       25



(14)     RELATED PARTY TRANSACTIONS


A  former  managing  director  of FCJ is the  controlling  shareholder  of SICO.
Transactions  with SICO during the years ended December 31, 1999,  1998 and 1997
consist of the following:


                                                    1999   1998   1997
                                                    ----   ----   ----

Rent of premises...................................$292   $354   $331
Purchase of services
and utilities...................................... 580    318    286
Other expenses.....................................  30     --     17
Sales of fibers....................................  --     25     49

In 1999, the Company has sales to MEFC of $236, in which the Company holds a 15%
interest.

The Company has a consulting  agreement with One Financial Group,  Incorporated,
that provides services as a financial advisor.  Mr. Steven Phillips,  a director
of the Company,  controls One Financial Group. The Company incurred costs of $46
in each of the years 1998 and 1997 under this agreement.  In 1999, One Financial
Group was  granted  options to purchase  common  stock of the Company in lieu of
receiving  cash payment for services  valued at $94.  This amount is included in
selling, general and administrative expenses.


                                       48
<PAGE>


             FIBERCORE, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED
                        FINANCIAL STATEMENTS (CONTINUED)
                    (AMOUNTS IN THOUSANDS EXCEPT SHARE DATA)


(15)     FOREIGN OPERATIONS

The Company has  operations  in three  principal  geographic  areas:  the United
States  (Company and ALT),  Germany (FCJ),  and Malaysia  (FCA).  Following is a
summary of information  by area for the years ended December 31, 1999,  1998 and
1997:



                                               1999        1998        1997


Net  sales to  customers in:
  United States..........................   $  1,697    $    135      $   128
  Germany................................      5,432       5,015        4,859
  United Kingdom.........................      2,895       1,801        1,234
  Other..................................      2,102       1,250          857
                                             --------    --------      -------
Net sales as reported in the accompanying
 consolidated statements of operations...   $ 12,126    $  8,201      $ 7,078
                                             ========    ========      =======

Long-lived assets:

  United States..........................   $  9,375    $  9,499      $ 9,936
  Germany................................      3,788       4,885        4,580
  Malaysia...............................      5,336       5,299           --
                                             --------    --------      -------
  Total long-lived assets................   $ 18,499    $19,683       $14,516
                                             ========    ========      =======

Inter-company  sales are eliminated in  consolidation  and are excluded from net
sales  reported  in the  accompanying  consolidated  statements  of  operations.
Identifiable  assets are those that are  identifiable  with  operations  in each
geographic  area.  FCA  (Malaysia)  had  no  significant  operations  since  its
formation in 1997.

(16)     ACCOUNTING PRONOUNCEMENTS

In June  1998,  the  FASB  issued  SFAS  No.  133,  "Accounting  for  Derivative
Instruments and Hedging Activities", which requires that an entity recognize all
derivatives as either assets or liabilities in the  consolidated  balance sheets
and measure those  instruments at fair value. The accounting for changes in fair
value of a  derivative  depends on the intended  use of the  derivative  and its
resulting  designation.  The Company is evaluating the effect this new standard,
as amended,  will have on the  Company's  financial  statements.  The Company is
required to adopt this standard by January 1, 2001.

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

            None.


                                       49
<PAGE>


                                    PART III
                                    --------


ITEM 10.  DIRECTORS  AND  EXECUTIVE  OFFICERS  OF THE  REGISTRANT  EXECUTIVE
          OFFICERS AND DIRECTORS

The following  tables set forth certain  information with respect to each person
who was an executive officer or director of the Company as of December 31, 1999.



            NAME         AGE           POSITION


Dr. Mohd A. Aslami       53       Chairman of the Board of Directors, Chief
                                   Executive Officer, and President
Charles De Luca          62       Managing Director of FiberCore Jena GmbH
                                   And Director of the Company
Michael J. Beecher       55       Chief Financial Officer and Treasurer
Steven Phillips          54       Director
Hedayat Amin-Arsala      58       Director
Javad K. Hassan          59       Director


Dr.  Aslami  is a  co-founder,  Chairman  of the  Board of  Directors  and Chief
Executive  Officer of the Company.  Dr.  Aslami has served as Chairman and Chief
Executive  Officer of FiberCore Jena, the Company's  wholly-owned  subsidiary in
Germany,  since 1994. Dr. Aslami also  co-founded ALT in 1986, and served as its
President,  Chief  Executive  Officer and director from 1986 to 1994. Dr. Aslami
received a Ph.D. in chemical  engineering  from the  University of Cincinnati in
1974.

Mr. De Luca is Managing  Director of FiberCore Jena GmbH and is a co-founder and
director of the  Company.  Mr. De Luca also  co-founded  and became an Executive
Vice  President  and  director of ALT in 1986.  Mr. De Luca  received his MBA in
marketing and business management from St. Johns University in 1974.

Mr.  Beecher  became Chief  Financial  Officer of the Company in April 1996. Mr.
Beecher  was the Vice  President/Treasurer  and Chief  Financial  Officer at the
University of  Bridgeport  from 1989 through  1995.  Mr.  Beecher is a Certified
Public Accountant and is a member of the American  Institute of Certified Public
Accountants.



                                       50
<PAGE>


        DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT (CONTINUED):


Mr.  Phillips became a director of the Company in May 1995 and became a director
of ALT in 1989. In addition to his consulting  activities  for the Company,  Mr.
Phillips also serves as a director and financial  advisor for several  companies
through his company, One Financial Group Incorporated. Until recently, he served
as interim Chief Financial Officer for a start-up internet company, and for five
years as Chief Financial Officer of the Winstar Government Securities Company L.
P., a registered U.S.  Government  securities dealer which he co-founded.  Since
August  1987,  Mr.  Phillips  has  served  as a  director,  Secretary  and Chief
Financial Officer of James Money Management, Inc., a private investment company.

Mr.  Amin-Arsala held various senior positions with the World Bank for 18 years.
He was in charge of World Bank  operations  in countries of East and South Asia,
retiring in 1987.  He served as the  Minister of Finance for the Afghan  Interim
Government  from 1989 to 1992, and Minister of Foreign  Affairs for  Afghanistan
from 1993 to 1996. Since 1996, Mr. Amin-Arsala has acted in an advisory capacity
to the United Nations and the United States Agency for International Development
and has  served a  number  of  governmental  and  non-governmental  humanitarian
organizations.

Mr.  Hassan  joined  AMP  Incorporated  (now  Tyco)  in 1988  as Vice  President
Technology  and in  1993  was  appointed  Corporate  Vice  President,  Strategic
Businesses, later renamed Global Interconnect Systems Business ("GISB") where he
pioneered and deployed a new strategy to take Tyco from a connector company to a
global  interconnection  systems  and  solutions  organization.   He  was  named
President of GISB in 1993.  After retiring from Tyco in 1998, Mr. Hassan founded
and is Chairman and CEO of NeST (Network Systems and Technologies) a provider of
software,  systems  and  electronics  design  and  manufacturing  with over 2000
employees.  He is  Chairman of AM  Communications,  a public  company  providing
broadband network monitoring and management  systems to cable TV operators,  and
General  Partner to MESA (Middle East and Southeast  Asia) Venture  Capital Fund
for targeted investments in US based technology companies. He is a member of the
board of several  companies  and  currently  serves as Chairman of the Eletronic
Development  Commission  for the  Government  of  Kerala in  India.  Mr.  Hassan
received  a  B.S.M.E.  degree  from  Kerala  University  in 1962,  a Masters  of
Materials Science degree from the University of Bridgeport,  Connecticut in 1968
and was elected IEEE Fellow,  Institute of Electrical and Electronics  Engineers
in 1986.

Pursuant to Section 16(a) of the Securities  Exchange Act of 1934 (the "Exchange
Act") and the rules thereunder,  the Company's  executive officers and directors
are  required  to file  with the  Securities  and  Exchange  Commission  and the
National  Association  of  Securities  Dealers,  Inc.  reports of ownership  and
changes in ownership of Common Stock.  Copies of such reports are required to be
furnished  the  Company.  Based  solely on review of the copies of such  reports
furnished to the Company, or written  representations that no other reports were
required,  the Company believes that during the year ended December 31, 1999 all
of its  executive  officers and  directors  complied  with the  requirements  of
Section16(a),  except that: Mohd Aslami, an officer and director of the Company,
did not  timely  file the  annual  Form 5 with  respect  to his  acquisition  of
1,114,644  options to purchase  shares of the Company and did not timely  report
the  acquisition by his wife of 1,271,676  shares issued on conversion of a loan
in December  1999;  Mr. Charles De Luca, an officer and director of the Company,
did not timely file the annual Form 5 with respect to his acquisition of 515,296
options  to  purchase  shares  of the  Company  and did not  timely  report  the
acquisition  by his wife of 1,271,676  shares  issued on conversion of a loan in
December 1999; and, Michael Beecher,  an officer of the Company,  did not timely
file the annual Form 5 with  respect to his  acquisition  of 408,972  options to
purchase  shares of the  Company.  Mr.  Hedayat  Amin-Arsala,  a director of the
Company,  did not timely file the annual Form 5 with respect to his  acquisition
of 54,666  options to purchase  shares of the Company and did not timely  report
his  acquisition  of 1,488,243  shares on conversion of a loan in December 1999.
Mr. Javad K. Hassan,  a director of the Company,  did not file the annual Form 5
with  respect to his  acquisition  of 53,833  options to purchase  shares of the
Company.


                                       51
<PAGE>




ITEM 11. EXECUTIVE COMPENSATION

Following is a summary of the  compensation  earned and/or paid to the Company's
Chief Executive Officer and its most highly  compensated  executive officers for
the last three years.

                           SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>

                      ANNUAL COMPENSATION                                   AWARDS
--------------------------------------------------------------------------------------------------------------
Name and Principal Position   Fiscal Year Salary$    Bonus$   Other Annual   Restricted Stock     Securities
                                                              Compensation       Award(s)$        Underlying
                                                                                                Options/SARs(#)
--------------------------------------------------------------------------------------------------------------
<S>                              <C>       <C>         <C>        <C>            <C>               <C>
Dr. Mohd Aslami                  1999      133,334     ---         ---                             1,114,644
  Chairman, Chief Executive      1998      156,583     ---         ---                               184,911
  Officer & President            1997      146,500     ---         ---                               359,752
--------------------------------------------------- ---------------------------------------------------------
Charles De Luca                  1999       76,761     ---         ---                               515,296
  Managing Director              1998       97,116     ---         ---                               106,324
  FiberCore Jena GmbH            1997       98,398     ---         ---                               189,502
--------------------------------------------------- ---------------------------------------------------------

Michael J. Beecher               1999       86,250     ---         ---                               408,972
  Chief Financial Officer        1998      100,000     ---         ---                                    --
  & Treasurer                    1997       85,000     ---         ---                               120,000
--------------------------------------------------- ---------------------------------------------------------
Hans Moeller                     1999      120,000     ---         ---
  Former Managing Director,      1998      120,000     ---         ---                                    --
  FiberCore Jena GmbH            1997      120,000     ---         ---                               300,000
--------------------------------------------------- ---------------------------------------------------------


Under an agreement  dated October 1, 1998, in 1999 Dr.  Aslami,  Mr. De Luca and
Mr. Beecher accepted salary reductions of 33.3%, 33.3%, and 25.0%,  respectively
and were awarded stock options for these salary reductions to purchase shares of
739,644,  425,296,  and  318,972,  respectively.  The option  exercise  price is
$0.1875 per share,  which was the closing  price of the shares as of the date of
the agreement.


                                       52
<PAGE>


                       EXECUTIVE COMPENSATION (CONTINUED):


OPTION/SAR GRANTS IN LAST FISCAL YEAR

The following table lists the options  granted to the executive  officers during
the year ended December 31, 1999.


------------------------------------------------------------------------------------------------------------------------------
                                                              INDIVIDUAL GRANTS
------------------------------------------------------------------------------------------------------------------------------
          Name               Number of    % of Total     Exercise       Expiration         Potential       Potential realized
                             Securities     Options/      or base          Date         realized values    values at assumed
                             Underlying       SARs         price                          at assumed        annual rates of
                             Options/     Granted to     ($/Share)                      annual rates of       stock price
                                SARs        Employees                                    stock price        appreciation.
                              Granted      in Fiscal                                  appreciation for      for option term
                                (#)          Year                                        option term           10% ($)
                                                                                            5%($)
------------------------------------------------------------------------------------------------------------------------------
Dr. Mohd Aslami                  739,644     27.5%        $0.1875      Oct. 1, 2008        $  5,893            $   91,530
                                 375,000                  $2.125       Dec. 31, 2009       $501,150            $1,270,014
------------------------------------------------------------------------------------------------------------------------------
Charles De Luca                  425,296     12.7%        $0.1875      Oct. 1, 2008        $  3,388            $   52,630
                                  90,000                  $2.125       Dec. 31, 2009       $120,276            $  304,803
------------------------------------------------------------------------------------------------------------------------------
Michael J. Beecher               318,972     10.1%        $0.1875      Oct. 1,2008         $  2,541            $   39,472
                                  90,000                  $2.125       Dec. 31, 2009       $120,276            $  304,803
------------------------------------------------------------------------------------------------------------------------------

</TABLE>





             (The remainder of this page intentionally left blank.)


                                       53
<PAGE>

                       EXECUTIVE COMPENSATION (CONTINUED):


AGGREGATED OPTIONS/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR END OPTIONS/SAR VALUES


The following  table lists the  options/SARs  exercised  during the year and the
options/SARs  held by the executive  officers that were  unexercised at December
31, 1999.


<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------------------------
                                                                                                     Value of unexercised
                                                                    Number of Securities         In-the-money options/SARs at
                                                                   Underlying unexercised                 FY-end ($)
                            Shares acquired        Value         options/SARs at FY-end (#)       Exercisable/Unexercisable
          Name              on exercise (#)    Realized ($)      Exercisable/Unexercisable
------------------------------------------------------------------------------------------------------------------------------
<S>                              <C>            <C>                   <C>                            <C>
Dr. Mohd Aslami                    --                --               975,398/744,822                $1,585,927/$715,530
------------------------------------------------------------------------------------------------------------------------------
Charles De Luca                    --                --               554,524/302,648                 $896,676/$412,006
------------------------------------------------------------------------------------------------------------------------------
Michael J. Beecher                 --                --               333,734/249,486                 $452,738/$309,004
------------------------------------------------------------------------------------------------------------------------------
Hans Moeller                       --                --                  300,000/0                       $289,500/$0
------------------------------------------------------------------------------------------------------------------------------
</TABLE>

COMPENSATION OF DIRECTORS

The Company maintains a compensation  plan for outside directors  (directors who
are not employees of the  Company),  wherein each outside  director  receives an
initial  award of 10,000  non-qualified  stock  options and a fee of $10,000 per
year,  payable  quarterly,  and $250 for each  Board  of  Directors  meeting  or
Committee of the Board meeting attended.

The Company has a consulting  agreement with One Financial  Group,  Incorporated
that provides services as a financial advisor.  Mr. Steven Phillips,  a director
of the Company,  controls of One Financial  Group. The Company incurred costs of
$46,000 in each of the years 1998 and 1997 under this  agreement.  In 1999,  One
Financial  Group was granted  options to purchase common stock of the Company in
lieu of payment for services valued at $94,000.




                                       54
<PAGE>

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
         MANAGEMENT

PRINCIPAL SECURITY HOLDERS

The following  table sets forth certain  information  regarding the ownership of
the Common  Stock as of March 1, 2000,  with respect to (i) each person known by
the Company to own beneficially more than 5% of the outstanding shares of Common
Stock,  (ii) each executive officer named in the Executive  Compensation  Table,
(iii) each  director  of the Company and (iv) all the  directors  and  executive
officers  of the Company as a group.  Unless  otherwise  indicated,  each of the
shareholders  has sole voting and  investment  power with  respect to the shares
beneficially owned.

<TABLE>
<CAPTION>
         NAME
          AND                                                 SHARES                      %
        ADDRESS(1)                                            OWNED                     OWNED
       ----------                                             ------                    -----
<S>                                                       <C>                          <C>
Mohd Aslami..........................................     9,591,769  (2), (10)          16.5
Charles De Luca......................................     6,286,360  (3), (10)          10.8
Steven Phillips......................................     3,232,914  (4)                 5.6
Hans F.W. Moeller....................................       388,235  (5)                 0.7
Michael J. Beecher...................................       583,220  (6)                 1.0
Hedayat Amin-Arsala..................................     2,412,940  (7)                 4.1
Javad K. Hassan......................................        53,333  (8)                  .1
Tyco Electronics Corp. (formerly AMP) ...............     9,244,297  (9),(10)           15.9
All directors and executive officers
  as a group (7 persons).............................    22,548,771                     38.7%
</TABLE>
------------------------------------

(1)  The  addresses  of the  persons  and  entities  named in this  table are as
     follows:  Messrs.  Aslami,  De Luca,  Phillips,  Beecher,  Amin-Arsala  and
     Hassan, c/o FiberCore,  Inc., P. O. Box 180, 253 Worcester Road,  Charlton,
     MA 01507;  Tyco  Electronics  Corp., 470 Friendship  Road,  Harrisburg,  PA
     17105; Mr. Moeller, 10 Mansion Lane, Greenwich, CT 06831.

(2)  Includes  1,389,158  shares and warrants to purchase 323,082 shares held by
     Dr.  Aslami's  wife,  316,420  shares held by Dr.  Aslami's minor child and
     1,587,569 shares held by the Ariana Trust of which Dr. Aslami's wife is the
     trustee and his children are beneficiaries. Also includes 1,944,161 options
     and warrants to purchase  shares of the Company and 766,406 shares issuable
     on conversion of debt.

(3)  Includes  2,666,772  shares and warrants to purchase 323,082 shares held by
     Elizabeth De Luca, Mr. De Luca's wife.  Also includes  941,697  options and
     warrants to purchase  shares of the Company and 475,582 shares  issuable on
     conversion of debt.


                                       55
<PAGE>

   SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT (CONTINUED):


(4)  Includes  1,631,574  options and  Warrants and 730,604  shares  issuable on
     conversion  of  debt  to  One  Financial  Group,  Incorporated,  a  Company
     controlled by Mr. Phillips and 67,083 options and warrants.

(5)  Includes 300,000 options.

(6)  Includes 583,220 options.

(7)  Includes 110,499 shares held by Mr. Amin-Arsala's wife.

(8)  Includes  options to acquire  53,333  shares to be issued to Mr. Hassan for
     his appointment as a director.

(9)  Includes  3,419,977  shares  into  which  the Tyco Note is  convertible  at
     $0.6641 per share and Warrants to purchase 2,765,487 shares.

(10) Under the Tyco loan,  the  Company,  Mohd A.  Aslami,  Charles De Luca,  M.
     Mahmud Awan (a former  director)  and Tyco entered into a Voting  Agreement
     pursuant  to  which  they  agreed  to vote  together  to  elect a slate  of
     directors to the Board of Directors of the Company.







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                                       56
<PAGE>


ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

LOANS

During the year 1999, the Company  issued notes to Dr.  Aslami,  Mr. De Luca and
One Financial Group Incorporated  ("OFG"), in the amounts of $192,000,  $119,000
and $181,000,  respectively,  for previously unpaid salaries,  fees and expense.
Mr. Phillips,  a director of the Company,  controls OFG. The notes bear interest
at 8.0% per year and are due on  December  31,  2000.  In  conjunction  with the
notes, Dr. Aslami,  Mr. De Luca and OFG were granted warrants to purchase shares
of the Company of 161,441, 84,525, and 150,735,  respectively. The warrants have
an exercise price of $0.25 per share which was the closing  trading price of the
shares at the date of issue and expire on July 1, 2004. Additionally, the unpaid
balance of the notes plus accrued and unpaid interest are also  convertible into
shares of the Company at $0.25 per share, which was the closing trading price of
the shares at the date the notes were issued.

During the year,  two notes each in the  principal  amount of $250,000,  due the
spouses of Dr. Aslami and Mr. De Luca, matured and were renewed.  In conjunction
with the renewal, each lender was granted warrants to purchase 323,082 shares of
the Company at $0.26 per share and the renewed notes included  conversion rights
at the same $0.26 per share which was the closing  trading  price at the date of
issue. In December 1999, these notes were converted into 2,543,352 common shares
of the Company.

Also during 1999, Mr.  Amin-Arsala  converted a note due him from the Company in
the principal amount of $249,000 into 1,488,243 common shares of the Company.

CONSULTING

See Item 11, Executive Compensation - Compensation of Directors.














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                                       57
<PAGE>

                                     PART IV
                                     -------

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

(a)      1.  FINANCIAL STATEMENTS
               See Item 8 of this Report

         2.  FINANCIAL STATEMENT SCHEDULES

                The required  disclosures  are included in the  footnotes to the
                Financial Statements

         3.  EXHIBITS
                (+ denotes incorporated herein by reference to the Annual Report
                on Form 10-K for the year ended  December 31,  1996,  filed with
                the  Commission  on  March  26, 1997)
                (x denotes incorporated herein by reference to the Annual Report
                on Form 10-K for the year ended  December 31,  1997,  filed with
                the Commission on March 26, 1998)
                (xx denotes filed herewith)

<TABLE>
<CAPTION>

EXHIBIT
NUMBER
------
<S>            <C>
  +2.1       Agreement and Plan of Reorganization dated as of July 18, 1995 between Venturecap, Inc. and FiberCore Incorporated.
  +2.2       Agreement of Merger dated as of July 18, 1995 between Venturecap, Inc. and FiberCore Incorporated.
  +2.3       Agreement and Plan of Reorganization  dated as of September 18, 1995 between the FiberCore,  Inc. Alt Merger Co., and
             Automated Light Technologies, Inc. ("ALT").
  +2.4       Agreement dated February 13, 1987 between Norscan Instruments Ltd. and ALT.
  +3.1       Certificate of Incorporation of FiberCore, Inc.
  +3.2       By-Laws of FiberCore, Inc.
  +10.1      Loan Agreement dated August 2, 1990 between ALT and Connecticut Innovations, Inc. ("CII").
  +10.2      Promissory Note issued by ALT to CII.
  +10.3      Security Agreement dated as of August 1990 between ALT and CII.
  +10.4      Subordination executed August 2, 1990 between CII, Mohd Aslami, and Charles De Luca.
  +10.5      Collateral Assignment and Security Agreement dated August 2, 1990 between ALT and CII.
  +10.6      Loan Agreement dated December 5, 1990 between ALT and the Connecticut Development Authority  ("CDA").
  +10.7      Promissory Note dated December 5, 1990 issued by ALT to CDA.
  +10.8      Guaranty dated December 5, 1990 issued to CDA by Mohd Aslami and Charles De Luca.
  +10.9      Collateral Assignment and Security Agreement dated December 5, 1990 between ALT and CDA.
  +10.10     Security Agreement dated as of December 5, 1990 between ALT and CDA.
  +10.11     Subordination dated November 5, 1990 between CDA, Mohd Aslami and Charles De Luca.
  +10.12     Form of Warrant issued by ALT to CDA.
  +10.13     Form of Warrant issued by Agreement between ALT to Connecticut Innovations Incorporated.
  +10.14     Form of Warrant issued by ALT.
  +10.15     Form of FiberCore Incorporated Warrant.
  +10.16     Assignment dated November 8, 1993 by Gregory Perry to FiberCore Incorporated of U.S. Patent No. 4,596,589.
  +10.17     Lease executed January 31, 1994 between Cobra Realty Trust, FiberCore Incorporated, Mohd Aslami and Charles De Luca.
  +10.18     Agreement  dated June 7, 1994 between Sico  Quarzschmelze  Jena,  GmbH ("Sico") and FiberCore Inc., to lease building
             and equipment and to manufacture optical fiber and optical fiber preform.
  +10.19     Agreement  dated August 19, 1995 between Sico and  FiberCore  Glasfaser  Jena GmbH,  with  supplemental  agreement by
             Walter Nadrag.
  +10.20     Cooperation Agreement dated December 19, 1995 between Sico and FiberCore, Inc.
</TABLE>

                                       58
<PAGE>
<TABLE>
<S>           <C>
  +10.21     Lease dated August 19, 1995 between Sico and FiberCore Glasfaser Jena GmbH.
  +10.22     Agreement dated January 25, 1996 between FiberCore, Inc., FiberCore Glasfaser, Jena and Sico.
  +10.23     Share Purchase Agreement dated January 11, 1996 between FiberCore, Inc. and Techman International, Corp. ("Techman").
  +10.24     Escrow  Agreement  dated as of April 13, 1995 between  FiberCore  Incorporated,  Middle East  Specialized  Cables Co.
             ("MESC") and Shawmut Bank, N.A.
  +10.25     Escrow Amending  Agreement dated  September 15, 1995 between  FiberCore,  Inc.,  Middle East  Specialized  Cables Co.
             ("MESC") and Shawmut Bank, N.A.
  +10.26     Share Purchase Agreement dated as of April 13, 1995 between FiberCore Incorporated and MESC.
  +10.27     Share Purchase Amending Agreement dated September 15, 1995 between the Registrant and MESC.
  +10.28     Convertible  Debenture  Purchase  Agreement  effective as of April 17, 1995 between AMP  Incorporated  and  FiberCore
             Incorporated,  with form of Convertible Debenture Attached, as Exhibit A.
  +10.29     Cooperation Agreement dated June 17, 1994 between John Royle & Sons and FiberCore Incorporated,  with Amendment No. 1
             executed on the same date.
  +10.30     Warrant issued by FiberCore, Inc. to Techman to purchase up to 550,696 shares of Common Stock.
  +10.31     Agreement dated July 1, 1994 between FiberCore Incorporated and FiberCore Glasfaser Jena GmbH.
  +10.32     Joint Venture  Agreement  dated January 31, 1996 between  Middle East Optic Fiber Company  ("MEOFC"),  Royle Mid East
             Ltd. and FiberCore Mid East Ltd.
  +10.33     Convertible Note Purchase Agreement and Convertible  Promissory Note between FiberCore,  Inc. and Hedayat Amin-Arsala
             in the amount of $200,000, each dated March 15, 1996.
  +10.34     Joint Venture Agreement dated May 21, 1995 between the Company, Techman and the other parties named therein.
  +10.35     International Distributor Agreement between Techman and the Company, dated November 1, 1995.
  +10.36     Term Loan Agreement by and between FiberCore, Inc. as borrower and AMP Incorporated a lender dated November 27, 1996.
  +10.37     Term Promissory Note in the original principal amount of $3 million dated November 27, 1996.
  +10.38     Amendment  No.  1 to  Convertible  Debenture  Purchase  Agreement  between  FiberCore,  Inc.,  as  borrower  and  AMP
             Incorporated as Lender dated November 27, 1996.
  +10.39     Subsidiary Guarantee between FiberCore Glasfaser Jena GmbH and AMP Incorporated dated November 27, 1996.
  +10.40     Security Interest Agreement between FiberCore Glasfaser Jena GmbH and AMP Incorporated dated November 27, 1996.
  +10.41     Patent Security Agreement between FiberCore, Inc. and AMP Incorporated dated November 27, 1996.
  +10.42     Warrant issued to AMP Incorporated to purchase shares of Common Stock of FiberCore, Inc. November 27, 1996.
  +10.43     Amended and Restated Convertible Debenture dated April 17, 1995.
  +10.44     Voting Agreement  between  FiberCore,  Inc., AMP  Incorporated,  Mohd Aslami,  Charles De Luca and Dr. M. Mahmud Awan
             dated November 27, 1996.
  +10.46     Supply contract between AMP Incorporated and FiberCore, Inc. dated July 29, 1996.
  +10.47     Loan Agreement between FiberCore, Inc. and Berliner Bank AG for the amount of DM 7,700,000 dated September 6, 1996.
  +10.48     Grants  Agreements  between  FiberCore  Glasfaser Jena GmbH and the Ministry of Economics and  Infrastructure  in the
             amount of DM  2,300,000  dated June 12, 1996 and  December 30, 1995.
  +10.49     Intercompany Loan Agreement  between  FiberCore,  Inc. and FiberCore  Glasfaser Jena GmbH in connection with the loan
             from Berliner Bank AG dated July 10, 1996.
  +10.50     Form of Warrant issued by FiberCore,  Inc. to Techman to exercise up to 1,000,000  shares of Common Stock pursuant to
             the International Distributor Agreement dated November 1, 1995.
  +10.51     Note Purchase and Warrant  Agreement  between  FiberCore,  Inc. and Bereshkai S. Aslami in the amount of $250,000 and
             granting Warrants to purchase up to 115,220 shares of Common Stock.
  +10.52     Note  Purchase and Warrant  Agreement  between  FiberCore,  Inc. and  Elizabeth De Luca in the amount of $250,000 and
             granting Warrants to purchase up to 115,220 shares of Common Stock.
  +10.53     Forbearance Agreement between ALT and CDA Authority and granting of Warrants dated August 27, 1996.
  +10.54     Forbearance Agreement between ALT and CII and granting of Warrants dated July 31, 1996.
  +10.55     Long Term Preform Supply Agreement between  FiberCore,  Inc. and Fiber Optic Industries (Pvt.) Limited dated July 25,
             1996.
  +10.56     Long-term supply agreement between  FiberCore,  Inc. and Middle East Optical Fiber Cable Co. (MEFC) dated November 1,
             1996.
  x10.57     Joint Venture  Agreement  dated November 17, 1997 between  FiberCore,  Inc.,  Federal Power Sdn. Bhd., and PNB Equity
             Resource Corporation Sdn. Bhd.
</TABLE>

                                       59
<PAGE>

<TABLE>
<S>           <C>

  x10.58     Put Option  Agreement  dated  November 17, 1997  between  FiberCore,  Inc.,  Federal  Power Sdn.  Bhd. and PNB Equity
             Resource Corporation Sdn. Bhd.
  x10.59     Note Purchase and Warrant Agreement dated September 17, 1997 between FiberCore, Inc. and Income Partners LP.
  x10.60     Note Purchase and Warrant  Agreement  dated  September  17, 1997 between  FiberCore,  Inc. And Techman  International
             Corporation.
  x10.61     Note  Purchase  and  Warrant  Agreement  dated April 16,  1997  between  FiberCore,  Inc.  and Techman  International
             Corporation.
  x10.62     Note Purchase and Warrant Agreement dated September 17, 1997 between FiberCore, Inc. and Mohd A. Aslami.
  x10.63     Consulting Agreement dated January 1, 1997 between One Financial Group Incorporated and FiberCore, Inc.
  +14.0      Copy of patents purchased from Sico.
  x22        List of subsidiaries of FiberCore, Inc.
  xx27       Financial Data Schedule,  which is submitted  electronically to the Securities and Exchange  Commission for information
             purposes only.
</TABLE>

(B)      REPORTS ON FORM 8-K

         None.



                                       60
<PAGE>

                                   SIGNATURES

Pursuant to the  requirements of Section 13 or 15(d) of the Securities  Exchange
Act of 1934,  the  Registrant  has duly  caused  this report to be signed on its
behalf by the undersigned, thereunto duly authorized.


              FIBERCORE, INC.
               (Registrant)



        By: /s/  Mohd A. Aslami                              March 28, 2000
            ---------------------------------------
        Dr. Mohd A. Aslami
        Chairman, Chief Executive Officer
        and President (Principal Executive Officer)


        By: /s/ Michael J. Beecher                           March 28, 2000
          ------------------------------------------
        Michael J. Beecher
        Chief Financial Officer and Treasurer
        (Principal Financial Officer and
        Principal Accounting Officer)


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

<TABLE>
<CAPTION>

<S>                                        <C>
/s/Mohd A. Aslami                        Chairman of the Board,                            March 28, 2000
-----------------                        President
Dr. Mohd A. Aslami                       Chief Executive Officer,
                                         Director


/s/ Charles De Luca                      Secretary and Director                            March 28, 2000
-------------------
Charles De Luca


/s/ Steven Phillips                      Director                                          March 28, 2000
-------------------
Steven Phillips

</TABLE>

                                       61