U.S. Securities and Exchange Commission
                             Washington, D.C. 20549

                                   FORM 10-KSB

(X)  Annual Report  Pursuant to Section 13 or 15(d) of the  Securities  Exchange
     Act of 1934 for the annual period ended JUNE 30, 2002

( )  Transition  Report  Pursuant  to  Section  13 or  15(d)  of the  Securities
     Exchange  Act of 1934  For the  transition  period  from ______  TO _______


For the fiscal year ended June 30, 2002
Commission file number 0-12962


                            Cambridge Holdings, Ltd.
        -----------------------------------------------------------------
        (Exact name of small business issuer as specified in its charter)


           Colorado                                     84-0826695
-------------------------------             ------------------------------------
(State or other jurisdiction of             (IRS Employer Identification Number)
incorporation or organization)


         106 S. University Blvd. #14
              Denver, Colorado                                           80209
----------------------------------------                              ----------
(Address of principal executive offices)                              (Zip Code)


Issuer's telephone number, including area code             (303) 722-4008
                                                           --------------


Check  whether the Issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during  the past 12  months,  and (2) has been
subject to such filing requirements for the past 90 days.   Yes /X/     No
                                                                ---       ---

Check if disclosure of delinquent  filers pursuant to Item 405 of Regulation S-B
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-KSB or any  amendment to this Form 10-KSB.
[ ]

The issuers revenues consisted of $52,515 in interest and dividend income offset
by $212,185 in realized  losses on sales of  investment  securities  and $31,342
loss from  LLC's for net  revenues  for the fiscal  year ended June 30,  2002 of
$(191,012).

The  aggregate  market  value of the  voting  stock held by  non-affiliates  was
approximately $653,000 on September 18, 2002.


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

           Class                               Outstanding at September 13, 2002
-----------------------------                  ---------------------------------
Common Stock, $.025 par value                               3,029,870


Transitional Small Business Disclosure Format   Yes     No X
                                                   ---    ---

                                     Part I

Item 1.   DESCRIPTION/BUSINESS.

     (a) BUSINESS  DEVELOPMENT.  Cambridge  Holdings,  Ltd. the Registrant  (the
"Company"), was incorporated under the laws of the State of Colorado on June 23,
1980 under the name Jones Optical  Company.  The  Company's  name was changed to
Cambridge Holdings, Ltd. in August 1988.

In December  2001 the Company  finalized an agreement to acquire  securities  of
AspenBio,Inc.  for  $600,000.  The  Company  received  1,000,000  shares  (which
constituted at that time  approximately  11% of the outstanding  common stock of
AspenBio) and 360,000 warrants to purchase  AspenBio common stock exercisable at
$1 per share to January 1, 2007. Certain directors, officers, and consultants of
the Company also received an aggregate of 470,000 warrants to purchase  AspenBio
common stock with the same terms.  In September  2002,  the Company  completed a
distribution to its shareholders of 500,000 shares of the AspenBio stock.

In July 2002,  AspenBio  obtained a bank loan for purposes of constructing a new
facility.  The bank required  additional  collateral  and the Company  agreed to
guarantee up to $200,000 of the bank loan.  AspenBio  made a note to the Company
to cover  any  amounts  the  Company  may be  required  to pay  pursuant  to the
guarantee.  No amounts have been paid by the Company  pursuant to the guarantee.
In connection with the guarantee, AspenBio, Inc. issued a warrant to the Company
to purchase 100,000 shares of AspenBio common stock at $1.50 per share, expiring
July 5, 2005.

During  1997,  the  Company  purchased  in two  separate  transactions  from two
different  unaffiliated  sellers, raw land in an area known as Cordillera Valley
Club in Eagle County,  Colorado west of Vail. Each lot was conveyed to a limited
liability  company in which the Company is a member with a 50% interest (CVC Lot
2 LLC and CVC Lot 19 LLC).  The funds conveyed by the Company to the two limited
liability  companies were recorded as notes  receivable  from a related party on
the Company's  balance sheet. Each lot has been developed with a separate luxury
residence that was completed in early 1998.

In April 2001 CVC Lot 2, LLC sold its property for approximately $1,565,000 less
property costs,  closing fees and payments made to the Zneimer Company. The sale
transaction  resulted  in a  reported  gain  to  the  Company  of  approximately
$148,000,  after considering an impairment allowance of approximately  $240,300,
which had previously been recorded.


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<PAGE>

The note  receivable  from CVC Lot 19, LLC totaled  $150,000 after an impairment
allowance  of  $382,365  at June  30,  2002,  and is due  upon  the  sale of the
property. The Zneimer Company and Mr. Zneimer personally guaranteed one half the
original  principal  amount  of  the  CVC  Lot 19  note  issued  to the  Company
simultaneously  with the  conveyance  of the  property to the limited  liability
company.  The  Company  believes  that  collection  of this  guarantee  would be
doubtful.  Due to the delay on sale of the  property,  CVC Lot 19 LLC has rented
the  CVC  Lot 19  home  at a  monthly  rental  fee  of  $6,000,  currently  on a
month-to-month  basis.  The  house is  currently  listed  for sale by the LLC at
approximately $1,395,000.

The CVC Lot 19 home is located  in  Cordillera  Valley  Club,  a  mountain  golf
community  of 1 to 11-acre  home sites and  custom-designed  residences,  tennis
courts, 15 miles of hiking and  cross-country  ski trails, a fly-fishing  river,
mountain  bike and  nature  trails.  The home sites in the  community  have been
developed to minimize the impact of development  upon the varied  vegetation and
indigenous  wildlife  unique to the area. Deer and elk grazing and calving areas
have been carefully  preserved along with native grasses,  shrubs and trees. The
home sites in the community  have been planned to maximize  mountain  views,  as
well as the  extensive  aspen  groves,  forests  of fir and  spruce,  and varied
terrain of adjacent canyons and draws which is characteristic of the area.

In July 1997,  the Company  purchased  approximately  three acres of raw land in
Glenwood Springs, Colorado for $925,000 which property was sold in July 2000 for
$1,300,000 less property costs, closing fees and reimbursements,  resulting in a
net gain of approximately $252,500.

The Company is currently  considering other real estate development  activities,
as  well  as  other  business  opportunities.   In  addition  to  real  property
acquisitions,  the Company may consider the possible  acquisition  of, or merger
with,  another business  entity,  or other types of business  transactions.  The
Company  does not  intend  to limit  its  search  to  companies  in real  estate
activities.  A  substantial  amount of time may lapse and the Company may expend
considerable funds for consulting,  legal,  accounting and other fees before the
Company is able, if at all, to acquire other real estate interests or businesses
outside the real estate  industry.  From time to time, the Company also acquires
equity  securities,  which have a potential  for capital gains and losses or, in
some cases,  income potential.  The Company has no limitations on the percentage
of assets that may be invested in any one instrument, or type of investment, nor
is the  Company  limited in the types of real  estate in which the  Company  may
invest. The Company's determination of the method of operating and financing its
properties  is not  fixed,  and will,  instead  depend  on the type of  property
purchased and the Company's objective in operating the particular property.

In August 2000 the Company formed a wholly-owned  subsidiary,  CamCap,  Inc. The
subsidiary is not engaged in any active operations.

COMPETITION.  The real  estate  business is highly  competitive  and the Company
competes with numerous entities engaged in real estate activities, many of which
have  greater  financial  resources  than those of the  Company.  The  Company's


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management  believes that success against such competition is dependent upon the
quality of the investments,  the geographic location of the property, the amount
of new  construction  in the area and the design and appearance of the property.
The Company's management believes that general economic circumstances and trends
and new properties in the vicinity of each of the Company's properties will also
be competitive factors.

EMPLOYEES. The Company has only two employees, both of whom serve the Company on
a part-time basis.

Item 2. DESCRIPTION OF PROPERTIES.

     The  Company's  administrative  activities  are  conducted at the Company's
corporate  headquarters  located  in  Denver,  Colorado  in space  shared by the
Company with an affiliate, Livingston Capital, Ltd. ("Livingston").  The Company
pays   Livingston  a  monthly  fee  of  $750  for  rent  and  certain   overhead
administrative  expenses.  A description of real estate  business  activities is
included in Item 1.

Item 3.   LEGAL PROCEEDINGS.

     The Company is not involved in any material, pending legal proceedings.

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

     No matter was submitted to a vote of the Company's  security holders during
the  fourth  quarter  covered  by this  Report,  and  the  Item  is,  therefore,
inapplicable.

                                     PART II

Item 5. MARKET FOR COMPANY'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

     The  Company's  $.025  par value  common  stock  trades  on the  Electronic
Bulletin  Board  under the symbol  "CDGD".  Trading  in the common  stock in the
over-the-counter  market has been limited and sporadic  and the  quotations  set
forth below are not necessarily indicative of actual market conditions. Further,
these prices reflect  inter-dealer prices without retail mark-up,  markdown,  or
commission and may not necessarily reflect actual transactions. The high and low
bid prices for the common  stock for each quarter of the fiscal years ended June
30, 2002 and 2001 are as follows:

           Quarter Ended                     High Bid       Low Bid
           --------------------------------------------------------
           June 30, 2002                     $.42          $.40
           March 31, 2002                    $.41          $.41
           December 31, 2001                 $.41         $.375
           September 30, 2001                $.47         $.375
           June 30, 2001                     $.48          $.40
           March 31, 2001                    $.48          $.47
           December 31, 2000                 $.47          $.47
           September 30, 2000                $.47          $.47


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     At August 31, 2002 the number of holders of record of the Company's  common
stock was 954. No cash  dividends were paid during the years ended June 30, 2002
and 2001.

Item 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

     The  information  set forth in  "Management's  Discussion  and  Analysis of
Financial  Condition and Results of Operations"  below includes "forward looking
statements"  within the meaning of Section  27A of the  Securities  Act,  and is
subject to the safe harbor  created by that  section.  Factors  that could cause
actual results to differ  materially from these contained in the forward looking
statements are set forth in  "Management's  Discussion and Analysis of Financial
Condition and Results of Operations."

LIQUIDITY AND CAPITAL RESOURCES.

     At June 30, 2002, the Company had cash and cash equivalents of $408,800 and
working capital of $2,414,200.

As described in Item 1(a),  the Company has guaranteed up to $200,000 of debt of
AspenBio,  Inc. AspenBio is current in its obligations,  and it is not presently
known whether there will be any claim on the Company's guarantee.

CVC Lot 19 LLC has incurred debt financing of $1,013,000 for the construction of
the luxury residential property. In addition to the debt financing,  the Company
has a note  receivable  and loans due from CVC Lot 19 LLC of $532,400  (prior to
the impairment  allowance)  for interest on the mortgage,  aid in completing and
selling the  residential  property  and for sale of land to the LLC.  Due to the
delay on the sale of this  property  and the  Company's  assessment  of  current
market conditions, it is presently expected that when sold, it will be sold at a
loss.  Management  has recorded an allowance  for the loss on the CVC Lot 19 LLC
note receivable for $382,400. Due to the delay on sale of this property, CVC Lot
19 LLC has rented the CVC Lot 19 home to an unrelated on a month-to-month  basis
for $6,000 per month.

For the period  ended  June 30,  2002,  operating  activities  consumed  cash of
$52,200 as compared to cash flow generated of $1,043,400 for the year ended June
30, 2001. Losses from the sale of investment  securities  increased from $33,000
in 2001 to $212,100  in 2002.  Land held for real  estate  development  was sold
during the year ended June 30, 2001 resulting in cash provided of $939,200.

Cash used by investing  activities was approximately  $1,508,300 during the year
ended June 30,  2002  compared  to cash  provided  by  investing  activities  of
$426,100 during the year ended June 30, 2001.  Approximately $1,235,800 was used
to purchase  investment  securities,  net of related security sales,  during the
year ended June 30,  2002  compared  to  $81,200 in 2001.  Investments  in notes
receivable  were $22,500 in 2002  compared to $55,400 in 2001.  Additional  cash
provided from investing  activities during fiscal 2001 was $566,000 collected on
notes  receivable.  The  Company's  assets,  especially  the values of the notes
receivable  and  securities  held by the Company are often highly  volatile.  In
addition,  trading in the  securities the Company holds may be thin or there may
be other impediments to, or restrictions on transfer.


                                  Page 5 of 17
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<PAGE>

     There was no cash activity in financing  activities  during the years ended
June 30, 2002 or 2001.

RESULTS OF OPERATIONS.

FISCAL YEAR ENDED JUNE 30, 2002 COMPARED TO FISCAL YEAR ENDED JUNE 30, 2001

     The  Company's  revenues  for the year ended  June 30,  2002  consisted  of
interest  and  dividend  income  of  $52,500,  offset  by  losses on the sale of
securities of approximately  $212,200 and a loss from LLC investments of $31,400
resulting  from an increase in the impairment  allowance on the note  receivable
from CVC Lot 19, LLC.  The  Company's  revenues for the year ended June 30, 2001
totaled  approximately  $1,384,900,  consisting  of proceeds on the sale of real
estate of $1,300,000, net income of $27,400 from LLC investment and interest and
dividend income of $90,500.  These revenues were offset by losses on the sale of
securities of approximately $33,000.

During the years ended June 30,  2002 and June 30,  2001,  the Company  incurred
operating,  general  and  administrative  costs of  approximately  $148,300  and
$187,600,  respectively.  The cost of the real estate sold during the year ended
June 30, 2001 was  $1,057,300.  During  1999,  the Company had written off a bad
debt of $101,300.  The Company  subsequently  filed suit and  collected  $70,000
during 2000 and $35,300 during 2001. The Company had a loss before taxes for the
year ended June 30,  2002 of  approximately  $301,200  as  compared  with income
before taxes of  approximately  $175,300  for the year ended June 30, 2001.  The
Company  recognized  tax benefits of $7,000 in 2001 as a result of net operating
losses.

INCOME TAXES

As discussed in Note 6 to the accompanying financial statements,  as of June 30,
2002 the Company has $351,000 in deferred tax assets.  Management of the Company
has developed a tax planning  strategy in which operating losses will be carried
forward to future tax  filings  and allow the  Company to realize an $82,000 tax
benefit.  A valuation  allowance of $269,000 has therefore been  established for
the  remaining  deferred  tax assets  because  the  Company has not been able to
determine  that it is more likely than not that the net deferred tax assets will
be realized.

Item 7. FINANCIAL STATEMENTS.
          See pages F-1 through F-17.

Item 8. Changes in and Disagreements with Accountants on Accounting and
        Financial Disclosure.

        Not applicable.


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<PAGE>

Item 9.   DIRECTORS AND EXECUTIVE OFFICERS.

                            Date First
                              Elected             Principal Occupation
Name                   Age   Director                and Employment
----                   ---   --------                --------------



<PAGE>



Gregory Pusey          50      1982     President, treasurer and director. Mr.
                                        Pusey is the president and director of
                                        Advanced Nutraceuticals, Inc., a
                                        manufacturer of nutraceuticals and
                                        liquid pharmaceutical products. Mr.
                                        Pusey is also a director of AspenBio,
                                        Inc. Mr. Pusey graduated from Boston
                                        College in 1974 with a BS in finance.
                                        Mr. Pusey is also the president of
                                        Livingston Capital, Ltd., a venture
                                        capital and business-consulting firm.

John H. Altshuler      71      1991     Director. Dr. Altshuler is a medical
                                        doctor with a specialty in  hematology.
                                        He maintains a laboratory  and a private
                                        medical practice and has served as a
                                        medical consultant since 1965. Dr.
                                        Altshuler  graduated  from  McGill
                                        University in 1959 with a doctorate in
                                        medicine.

Scott Menefee          37      1993     Director.  Mr. Menefee is the Director
                                        of Real Estate Development for Opus
                                        Northwest,  LLC, a large   commercial
                                        real estate development firm.  During
                                        his tenure with Opus, he has been
                                        involved  in the  development  of over 3
                                        million square feet of commercial real
                                        estate, including office buildings,
                                        shopping centers and industrial
                                        properties Mr. Menefee graduated from
                                        Southern Methodist University with a MBA
                                        in 1989 and the University of Denver
                                        with a BSBA in 1988.

Jeffrey G. McGonegal   51      2000     Senior Vice President-Finance, Secretary
                                        and Director. Mr. McGonegal has served
                                        as Senior Vice President-Finance of
                                        Advanced Nutraceuticals, Inc. since


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                                        February 2000.  Since 1997, Mr.
                                        McGonegal has also served as Managing
                                        Director of McGonegal and Co., a
                                        company engaged in providing accounting
                                        and business consulting services. From
                                        1974 to 1997, Mr. McGonegal was an
                                        accountant with BDO Seidman LLP. While
                                        at BDO Seidman, LLP, Mr. McGonegal
                                        served as managing partner of the
                                        Denver, Colorado office. Mr. McGonegal
                                        is a member of the Board of Directors of
                                        The Rockies Venture Club, Inc. and
                                        Colorado Venture Centers, Inc. He
                                        received a BA degree in accounting from
                                        Florida State University.

     The  Company's  directors  serve  until  the  next  annual  meeting  of the
shareholders  and until  their  successors  shall  have been  duly  elected  and
qualified.  The Company's  Board of Directors may remove the Company's  officers
from their positions at any time.  There are no family  relationships  among the
current  directors of the  Company.  During the fiscal year ended June 30, 2002,
the Company's Board of Directors held eight meetings in person or by consent.

     Based solely upon review of Forms 3, 4 and 5, which have been  furnished to
the Company  with  respect to the past fiscal year of the  Company,  and certain
representations  made by officers  and  directors  of the Company in  connection
therewith,  the Company has no  knowledge  that any current  officer or director
failed to file on a timely  basis any reports  required by Section  16(a) of the
Securities  Exchange  Act of 1934 with respect to the fiscal year of the Company
ended June 30, 2002, except that Form 5 reports regarding grants of options were
not filed on a timely basis.

Item 10.  EXECUTIVE COMPENSATION.

     (a) COMPENSATION. The following table sets forth the cash compensation paid
by the  Company  during the fiscal year ended June 30, 2002 and in the two prior
fiscal years of the Company to the chief  executive  officer of the Company.  No
executive officer received a total annual salary and bonus of more than $100,000
during the fiscal year.

<TABLE>
<CAPTION>
                           Summary Compensation Table

                              Annual Compensation                         Awards              Payouts
                              -------------------                         ------              -------
                                                        Other
Name and                                               Annual     Restricted                   LTIP            All Other
 Principal     Fiscal       Salary                    Compensa-      Stock       Options      Payouts          Compensa-
Position        Year        ($)(1)        Bonus         tion       Awards($)       (#)          ($)           tion($)(2)
--------        ----        ------        -----         ----       ---------       ---          ---           ----------
Gregory Pusey,
<S>             <C>         <C>           <C>         <C>         <C>            <C>          <C>             <C>
President       2002        60,000         -0-           -0-          -0-          -0-          -0-              5,207
                2001        60,000         -0-           -0-          -0-          -0-          -0-              5,207
                2000        60,000         -0-           -0-          -0-          -0-          -0-              5,207
</TABLE>


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     (1) The dollar value of base salary  (cash)  received.  (No  non-cash  base
salary was paid during the period  covered by the Table).  Mr.  Pusey's  current
salary is $60,000 per year.

     (2) All other  compensation paid that the Company has not properly reported
in any other column of the Table.  During the period  covered by the Table,  the
Company  did not make any  contributions  or other  allocations  to any  defined
contribution  plans.  The  compensation  shown is health  insurance  premiums of
$5,207 paid on Mr. Pusey's behalf.

1999 STOCK  OPTION  PLAN.  In April 1999,  the Board of Directors of the Company
adopted,  subject to shareholder approval, the 1999 Stock Option Plan (the "1999
Plan"). The 1999 Plan is administered by the Option Committee  consisting of the
full Board of Directors.

Any employee or officer (including  executive officers) of the Company or any of
its  subsidiaries  will be eligible for a stock option grant under the 1999 Plan
if selected by the Option  Committee.  Any consultant to the Company,  including
Directors, will also be eligible to receive option grants under the 1999 Plan if
authorized by the Option Committee.

The 1999  Plan as  adopted  and  subsequently  amended  authorizes  the grant of
options to purchase up to 60,000 shares of the Company's common stock. There are
currently  outstanding  options to  purchase up to 50,000  shares.  All of these
options were granted on April 16, 1999.  Of the options to purchase up to 50,000
shares,  options  to  purchase  10,000  shares  were  granted to each of John H.
Altshuler  and Scott L.  Menefee,  directors  of the  Company,  and  options  to
purchase  up to 30,000  shares  were  granted to Gregory  Pusey,  President  and
Director of the Company.  The options  granted to Dr.  Altshuler and Mr. Menefee
are exercisable at $.47 per share, the fair market value of the Company's common
stock on the date of grant.  The options granted to Mr. Pusey are exercisable at
$.52 per share, which represented 110% of the fair market value of the Company's
common stock on the date of grant.  Outstanding  options are exercisable through
April 15, 2004. The options will terminate  earlier if the optionee's  status as
an employee or consultant is discontinued. No amendments may be made without the
approval of the Company's  shareholders  to the extent such approval is required
by law or agreement.  The 1999 Plan will continue  until April 15, 2009,  unless
abandoned or terminated at an earlier time.

2001 STOCK OPTION PLAN. In October  2001,  the Board of Directors of the Company
adopted  the 2001  Stock  Incentive  Plan (the "2001  Plan").  The 2001 Plan was
approved  by  majority  vote of the  shareholders  in May  2002.  The 2001  Plan
replaces the 2000 Stock  Incentive Plan that was  terminated  (together with the
options  granted)  by  the  Board  because  it had  not  been  presented  to the
shareholders  for  approval  within  one  year  of its  adoption  as  originally
contemplated.  The purpose of the 2001 Plan is to promote the  interests  of the
Company and its shareholders by:

o    Attracting and retaining key personnel;
o    Providing  participants  a  significant  stake  in the  performance  of the
     Company;


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o    Providing an opportunity for participants to increase their holdings of the
     Company's common stock.

The Option Committee administers the 2001 Plan. The Option Committee consists of
the Board of Directors or a committee of the Board of Directors, as the Board of
Directors may from time to time designate, composed of not less than two members
of the Board of Directors,  each of whom shall be a director who is not employed
by the Company.  The Option  Committee  currently  consists of the full Board of
Directors.  The Option  Committee  has the  authority  to select  employees  and
consultants to receive awards, to determine the number of shares of common stock
covered by awards,  and to set the terms and  conditions  of awards.  The Option
Committee has the  authority to establish  rules for the  administration  of the
2001 Plan, and its determinations and interpretations are binding.

Any employee or officer (including  executive officers) of the Company or any of
its  subsidiaries  will be eligible for a stock option grant under the 2001 Plan
if selected by the Option  Committee.  Any consultant to the Company,  including
Directors, will also be eligible to receive option grants under the 2001 Plan if
authorized by the Option Committee.

The 2001  Plan as  adopted  and  subsequently  amended  authorizes  the grant of
options to purchase up to 650,000  shares of the Company's  common stock.  There
are currently  outstanding  options to purchase up to 430,000  shares.  Of these
options  280,000  were  granted  in October  2001 and  150,000  were  granted in
November 2001. Options to purchase 40,000 shares were granted to each of John H.
Altshuler and Scott L. Menefee, directors of the Company, options to purchase up
to 100,000 shares were granted to each of Gregory Pusey,  President and Director
of the Company  and  Jeffrey G.  McGonegal,  Senior  Vice-President  of Finance,
Secretary  and  Director of the Company and options to purchase  150,000  shares
were granted to Thomas  Weinberger,  a part-time  employee of the  Company.  The
options  granted  to  Dr.  Altshuler  and  Messrs.  Menefee  and  McGonegal  are
exercisable  at $.47 per share,  the fair market value of the  Company's  common
stock  on  the  date  of  grant.  The  options  granted  to Mr.  Weinberger  are
exercisable  at $.375 per share,  the fair market value of the Company's  common
stock on the date of grant.  The options granted to Mr. Pusey are exercisable at
$.52 per share, which represented 110% of the fair market value of the Company's
common stock on the  date of grant.   All of the options are  exercisable  for a
four-year term. The options will terminate  earlier if the optionee's  status as
an employee or consultant is discontinued.

The 2001 Plan was designed to permit the Option Committee to grant stock options
that qualify as "incentive stock options" or options that do not so qualify. The
option  grants  to Mr.  Pusey and Mr.  McGonegal  are  intended  to  qualify  as
incentive  stock  options,  and the option  grants to the other  persons are not
intended to so qualify.

In addition to stock  options,  the Company may also offer a participant a right
to purchase shares of common stock subject to such  restrictions  and conditions
as the Option Committee may determine at the time of grant.  Such conditions may
include,  but are not limited to,  continued  employment or the  achievement  of
specified  performance goals or objectives.  No restricted common stock has been
issued pursuant to the 2001 Plan.


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                                     10-KSB
<PAGE>

Certain    corporate    transactions   or   events   such   as   stock   splits,
recapitalizations,  spin-offs,  mergers,  etc. may directly affect the number of
outstanding  shares and/or the value of the  outstanding  common stock.  If such
transactions  occur,  the Option  Committee may adjust the number of shares that
may be granted under the 2001 Plan,  as well as the limits on individual  option
grants.  The Option  Committee  may adjust the number of shares and the exercise
price  under  outstanding  options,  and may make other  adjustments,  which are
thought to be in the best interest of the Company.

Options granted under the 2001 Plan may not be transferred except by will or the
laws of descent and distribution,  or pursuant to a qualified domestic relations
order or the Employee Retirement Income Security Act. The Board of Directors may
amend or terminate the 2001 Plan at any time. No amendments  may be made without
the  approval  of the  Company's  shareholders  to the extent  such  approval is
required by law or agreement. The 2001 Plan will continue until October 4, 2011,
unless abandoned or terminated at an earlier time.


     (b) AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END
         OPTION/SAR VALUES

                       Shares         Number of Shares     Value of Unexercised
                      Received       Underlying Unexer-        In-The-Money
Name                Upon exercise       cised Options     Options at 6/30/02 ($)
----                -------------       -------------     ----------------------
Gregory Pusey            -0-                130,000                 -0-
Scott Menefee            -0-                 50,000                 -0-
Jeff McGonegal           -0-                100,000                 -0-
John Altshuler           -0-                 50,000                 -0-
Thomas Weinberger        -0-                150,000                 -0-


     (c) OPTION GRANTS IN FISCAL YEAR ENDED JUNE 30, 2002.

                                    % of Total
                                      Options
                                    Granted to       Exercise or
                     Options    Employees/Directors  Base Price
Name               Granted (#)    in Fiscal Year       ($/Sh)    Expiration Date
----               -----------    --------------       ------    ---------------
Gregory Pusey        100,000           22.2%            $.52         10/5/05
Jeffrey McGonegal    100,000           22.2%            $.47         10/5/05
John Altshuler        40,000           11.15%           $.47         10/5/05
Scott Menefee         40,000           11.15%           $.47         10/5/05
Thomas Weinberger    150,000           33.3%            $.375       11/27/05

     (d) Equity Compensation Plan Information

     The following  table gives  information  about our common stock that may be
     issued  upon the  exercise  of  options  under all of our  existing  equity
     compensation  plans as of September 13, 2002.  We have options  outstanding
     under two plans, our 1999 Plan and our 2001 Plan.


                                  Page 11 of 17
                                     10-KSB
<PAGE>

<TABLE>
<CAPTION>

                                                                            (c) Number of
                                                                             Securities
                                                                              Remaining
                                                                            Available for
                                                                          Future Issuance
                                 (a) Number of          (b) Weighted        Under Equity
                                Securities to be      Average Exercise   Compensation Plans
                              Issued Upon Exercise        Price of           (Excluding
                                 of Outstanding         Outstanding          Securities       (d) Total of Securities
                             Options, Warrants and   Options, Warrants      Reflected in        Reflected in Columns
       Plan Category                 Rights              and Rights          Column (a))            (a) and (c)
--------------------------   ---------------------   -----------------   ------------------   -----------------------

<S>                           <C>                     <C>                   <C>                     <C>
Equity Compensation Plans         480,000                 $.453                 230,000                 710,000
Approved by Shareowners


Equity Compensation Plans            None                    --                      --                      --
Not Approved  by
Shareowners
</TABLE>


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

     The  following  table sets forth  ownership as of September 13, 2002 of the
issued and outstanding shares of the Company's $.025 par value common stock held
by each director,  individually,  and all officers and directors as a group, and
all  persons  who own five  percent  or more of the  outstanding  shares  of the
Company's  common stock.  The Company has only one class of capital  stock,  its
$.025 par value common stock.

                                        Number of                Percent of
Beneficial Owner                         Shares                     Class
----------------                         ------                     -----
John H. Altshuler                        50,000                     1.6%
18 Blue Heron Drive West
Littleton, CO 80121 (1)

Scott Menefee                            80,000                     2.6%
971 Garfield Street
Denver, CO 80206 (2)

Gregory Pusey                           1,729,618                   54.8%
106 S. University Blvd. #14
Denver, CO 80209 (3)

Cede & Co.                               452,357                    14.9%
PO Box 222
New York, NY 10274


                                  Page 12 of 17
                                     10-KSB
<PAGE>

Jeffrey G. McGonegal                     100,000                    3.2%
1905 W. Valley Vista Drive
Castle Rock, CO 80104 (4)

All officers and directors as a         1,959,618                   58.3%
group (4 persons) (1) (2) (3) (4)

E. Jeffrey Peierls                       482,037                    15.9%
73 S. Holman Way
Golden, CO 80401 (5)

Brian Peierls                            398,824                    13.2%
2903 Creeks Edge Parkway
Austin, TX  78733 (6)

The Peierls Foundation                   179,813                    5.9%
c/o of U.S. Trust Company of New York
114 West 47th Street
New York, NY  10036

     (1) Includes  options that are  currently  exercisable  to purchase  10,000
shares that have been  granted  under the 1999 Plan and 40,000  shares that have
been granted under the 2001 Plan.

    (2)  Includes  options that are  currently  exercisable  to purchase  10,000
shares that have been  granted  under the 1999 Plan and 40,000  shares that have
been granted under the 2001 Plan.

     (3) Includes 18,604 shares owned jointly by Mr. Pusey with his wife, and an
aggregate of 99,811 shares owned by Mrs. Pusey, individually or as custodian for
their  minor  children.  Includes  options  that are  currently  exercisable  to
purchase  30,000  shares that have been granted  under the 1999 Plan and 100,000
shares that have been granted under the 2001 Plan.

     (4) Includes  options that are currently  exercisable  to purchase  100,000
shares that have been granted under the 2001 Plan.

     (5) Includes 216,611 shares held of record by Brian E. Peierls.  E. Jeffrey
Peierls  disclaims  beneficial  ownership in the shares held by other members of
his family and Kathryn and Alice Thames.  Also includes the 179,813  shares held
by The Peierls Foundation as Jeffrey Peierls is a trustee.

     (6) Includes  38,500  shares owned by the two minor sons of Brian  Peierls.
Also includes the 179,813 shares held by The Peierls Foundation as Brian Peierls
is a trustee.

                                  Page 13 of 17
                                     10-KSB
<PAGE>

Item 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

     Pursuant to an oral  agreement  with  Livingston,  which is an affiliate of
Gregory  Pusey,  the  Company  pays  $750 per month to  Livingston  for rent and
certain  administrative  expenses.  The Company believes that these arrangements
have  been at least as  favorable  as could be  obtained  with a  non-affiliated
party.  In  addition,  the  Company  provides  a car  for  Gregory  Pusey,  it's
president.

     During  January  2002,  the  Company  made  a  $250,000  loan  to  Advanced
Nutraceuticals,  Inc.  ("ANI").  The note was interest  bearing at 7% per annum,
scheduled to mature in one year and was convertible at the Company's option into
shares of ANI common stock at $1.00 per share.  ANI also issued a warrant to the
Company  pursuant to which the Company may acquire up to 50,000  shares of ANI's
common stock at $1.00 per share through June 2004. The Company also owns 126,913
shares of ANI common  stock that it acquired  through  open-market  purchases at
then prevailing market prices. Gregory Pusey and Jeffrey McGonegal, officers and
directors  of the  Company,  are also  officers  of ANI and Mr.  Pusey is also a
director of ANI.

In September 2002, ANI agreed to reduce the conversion rate if the Company would
convert  the debt into  stock.  The  Company  agreed to  convert  principal  and
interest of the loan into 475,118  shares of ANI's Common Stock.  The loan,  and
the subsequent  conversion,  were approved by the  disinterested  members of the
Board of the  Company  and the Board  believes  that the terms  were at least as
favorable as could have been obtained from an unaffiliated party.

In December  2001, the Company  finalized an agreement to acquire  securities of
AspenBio,  Inc. for  $600,000.  The Company  received  1,000,000  shares  (which
constituted  approximately 11% of the outstanding  Common Stock of AspenBio) and
360,000  warrants to purchase  AspenBio  Common Stock  exercisable  at $1.00 per
share to January 1, 2001. At the Company's  direction,  directors,  officers and
consultants of the Company received an aggregate of 470,000 warrants to purchase
AspenBio  Common  Stock with the same terms.  The officers  and  directors  that
received  warrants to purchase  shares of AspenBio Common Stock were as follows:
John H. Altshuler,  10,000 shares; Jeff McGonegal, 60,000 shares; Scott Menefee,
10,000  shares;  and Gregory  Pusey,  150,000  shares.  In September  2002,  the
Company,  made a distribution to its  shareholders of 500,000 shares of AspenBio
Common Stock.  The  distribution  was made on a pro rata basis, and the officers
and directors received AspenBio Common Stock in proportion to their ownership of
the Company's Common Stock.

Item 13.  EXHIBITS AND REPORTS ON FORM 8-K.

     (a) EXHIBITS.
          The exhibits listed on the accompanying index to exhibits are filed as
part of this Annual Report.

     (b) REPORTS ON FORM 8-K.
          No  reports  on Form 8-K were filed  during  the last  fiscal  quarter
covered by this Report.

                                  Page 14 of 17
                                     10-KSB
<PAGE>

                                INDEX TO EXHIBITS

     (3)(a) Articles of  Incorporation,  as amended,  filed as an Exhibit to the
Registrant's  Annual  Report on Form 10-K for the year ended  June 30,  1990 are
incorporated herein by this reference.

     (3)(b) Bylaws, as amended,  filed as an Exhibit to the Registrant's  Annual
Report on Form 10-K for the year ended June 30, 1988 are incorporated  herein by
this reference.

     (10)(m) 1999 Stock Option Plan filed as Exhibit (10)(m) in the Registrant's
Report on Form 10-KSB for the year ended June 30, 1999 is incorporated herein by
this reference.

     (10)(n) 2001 Stock Option Plan filed as Exhibit  10(n) in the  Registrant's
Report on Form 10-KSB for the year ended June 30, 2001 is incorporated herein by
this reference.

     (10)(o) Securities Purchase Agreement, dated December 28, 2001, between the
Company and AspenBio,  filed as Exhibit 10.1 to the Registrant's  Report on Form
8-K dated March 12, 2002 is incorporated herein by this reference.

     (10)(p)  Investor Rights  Agreement,  dated December 28, 2001,  between the
Company and AspenBio,  filed as Exhibit 10.2 to the Registrant's  Report on Form
8-K dated March 12, 2002 is incorporated herein by this reference.

     (10)(q) Consulting Agreement,  dated December 28, 2001, between the Company
and AspenBio, filed as Exhibit 10.3 to the Registrant's Report on Form 8-K dated
March 12, 2002 is incorporated herein by this reference.

     (10)(r)  Letter,   dated  March  14,  2002,   confirming   performance  and
termination  in  the  Consulting   Agreement   filed  as  Exhibit  10.4  to  the
Registrant's  Report on Form 8-K dated March 12, 2002 is incorporated  herein by
this reference.

     (10)(s) Shareholder's  Agreement,  dated December 28, 2001, among AspenBio,
Cambridge and Roger Hurst,  filed as Exhibit 10.5 to the Registrant's  Report on
Form 8-K dated March 12, 2002 is incorporated herein by this reference.


                                  Page 15 of 17
                                     10-KSB
<PAGE>



                                   SIGNATURES

     In accordance  with the  requirements  of the Exchange Act, the  registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.

                                                   CAMBRIDGE HOLDINGS, LTD.

Date: September 30, 2002              By:      /s/ Gregory Pusey
                                               ---------------------------------
                                               Gregory Pusey
                                               President, Treasurer and Director

     In accordance  with the  requirements  of the Exchange Act, this report has
been signed below by the following  persons on behalf of the  registrant  and in
the capacities and on the dates indicated.

Date: September 30, 2002              By:      /s/ Gregory Pusey
                                               ---------------------------------
                                               Gregory Pusey
                                               President, Treasurer and Director


Date: September 30, 2002              By:      /s/ Jeffrey G. McGonegal
                                               ---------------------------------
                                               Jeffrey G. McGonegal
                                               Senior Vice President-Finance,
                                               Secretary and Director


Date: September 30, 2002              By:      /s/ John H. Altshuler
                                               ---------------------------------
..
                                               John H. Altshuler, Director


Date: September 30, 2002              By:      /s/ Scott Menefee
                                               ---------------------------------
                                               Scott Menefee, Director


                                  Page 16 of 17
                                     10-KSB
<PAGE>


                                  CERTIFICATION


Each of the undersigned,  Gregory Pusey, Chief Executive Officer, and Jeffrey G.
McGonegal, Chief Financial Officer, certify that:

     1. I have reviewed this annual report on Form 10-KSB of Cambridge Holdings,
Ltd.

     2. Based on my  knowledge,  this annual  report does not contain any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of circumstances  under which such statements were
made, not  misleading  with respect to the period covered by this annual report;
and

     3. Based on my knowledge,  the financial  statements,  and other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report.


Date: September 30, 2002    By:   /s/ Gregory Pusey
                                  ----------------------------------------------
                                  Gregory Pusey, Chief Executive Officer


Date: September 30, 2002     By:  /s/ Jeffrey G. McGonegal
                                  ----------------------------------------------
                                  Jeffrey G. McGonegal, Chief Financial Officer

                                  Page 17 of 17
                                     10-KSB

<PAGE>

                            CAMBRIDGE HOLDINGS, LTD.

                              FINANCIAL STATEMENTS
                       YEARS ENDED JUNE 30, 2002 AND 2001


<PAGE>

                                      INDEX

                                                                            Page
                                                                            ----

Independent Auditors' Report                                                F-2

Consolidated Balance Sheet                                                  F-3

Consolidated Statements of Operations and Comprehensive Income (Loss)       F-4

Consolidated Statements of Changes in Stockholders' Equity                  F-5

Consolidated Statements of Cash Flows                                       F-6

Notes to Consolidated Financial Statements                                  F-7

<PAGE>

                                AJ. ROBBINS, PC.
                          CERTIFIED PUBLIC ACCOUNTANTS
                              3033 EAST 1ST AVENUE
                                    SUITE 201
                             DENVER, COLORADO 80206

                          INDEPENDENT AUDITORS' REPORT



The Board of Directors
Cambridge Holdings, Ltd.
Denver, Colorado

We have  audited  the  accompanying  consolidated  balance  sheet  of  Cambridge
Holdings,  Ltd. and Subsidiary as of June 30, 2002, and the related consolidated
statements   of  operations   and   comprehensive   income/(loss),   changes  in
stockholders'  equity,  and cash  flows  for  each of the  years in the two year
period then ended.  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 generally accepted auditing standards
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, the consolidated  financial statements referred to above present
fairly, in all material respects,  the financial position of Cambridge Holdings,
Ltd. and  Subsidiary as of June 30, 2002,  and the results of its operations and
comprehensive  income/(loss) and its cash flows for each of the years in the two
year  period  then  ended  in  conformity  with  generally  accepted  accounting
principles in the United States of America.

                                AJ. Robbins, PC.
                                    Certified Public Accountants


Denver, Colorado
September 6, 2002

                                       F-2
<PAGE>


                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                           CONSOLIDATED BALANCE SHEET
                                  JUNE 30, 2002
                                  =============





                                     ASSETS

CURRENT ASSETS:
     Cash and cash equivalents                                      $   408,756
     Investment securities - available for sale, net                  1,523,832
     Note receivable - related party, net                               150,000
     Note receivable - related party                                    250,000
     Interest receivable - related party                                  8,750
     Deferred tax asset                                                  82,000
                                                                    -----------

                  Total Current Assets                                2,423,338

PROPERTY AND EQUIPMENT, net                                               4,225
                                                                    -----------

                                                                    $ 2,427,563

                      LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:
     Accounts payable and accrued expenses                          $     9,186
                                                                    -----------

                  Total Current Liabilities                               9,186
                                                                    -----------

COMMITMENTS AND CONTINGENCIES


STOCKHOLDERS' EQUITY:
     Common stock, $.025 par value; 15,000,000 shares
         authorized: 3,029,870 issued and outstanding                    75,747
     Additional paid-in capital                                       2,997,292
     Accumulated (deficit)                                             (577,901)
     Accumulated other comprehensive income (loss), net of tax:
         Net unrealized (losses) on securities
             available for sale                                         (76,761)
                                                                    -----------

                  Total Stockholders' Equity                          2,418,377
                                                                    -----------

                                                                    $ 2,427,563
                                                                    ===========

           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       F-3
<PAGE>



                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
      CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
      =====================================================================

                                                    For the Years Ended June 30,
                                                    ----------------------------
                                                         2002           2001
                                                      -----------   -----------
  REVENUES:
       Net realized (losses) on sales of
         investment securities                        $  (212,185)  $   (32,973)
     Net income (loss) from LLC investments               (31,342)       27,389
     Sale of real estate                                     --       1,300,000
     Interest and dividend income                          52,515        90,474
                                                      -----------   -----------

                  Total Revenues                         (191,012)    1,384,890
                                                      -----------   -----------



OPERATING (EXPENSES) AND OTHER INCOME:
     Operating, general and administrative               (148,290)     (187,563)
     Cost of real estate sold                                --      (1,057,304)
     Interest income - related party                        8,750          --
     Other income                                          29,328        35,270
                                                      -----------   -----------

                  Net Other Income (Expense)             (110,212)   (1,209,597)
                                                      -----------   -----------

INCOME (LOSS) BEFORE INCOME TAX (BENEFIT)                (301,224)      175,293

INCOME TAX (BENEFIT)                                         --          (7,000)
                                                      -----------   -----------

NET INCOME (LOSS)                                        (301,224)      182,293

OTHER COMPREHENSIVE INCOME (LOSS), net of tax -
     Unrealized holding gains (losses)                    244,339      (299,465)
                                                      -----------   -----------


COMPREHENSIVE (LOSS)                                  $   (56,885)  $  (117,172)
                                                      ===========   ===========

NET INCOME (LOSS) PER COMMON SHARE, BASIC AND DILUTED $      (.10)  $       .06
                                                      ===========   ===========

Weighted average number of
     common shares outstanding                          3,029,870     3,029,870
                                                      ===========   ===========


           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       F-4
<PAGE>

<TABLE>

                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
           ===========================================================
<CAPTION>

                                                                                                         Accumulated
                                                        Common Stock          Additional                   Other          Total
                                                  -------------------------    Paid-in     Accumulated  Comprehensive  Stockholders'
                                                    Shares        Amount       Capital     (Deficit)    Income/(Loss)     Equity
                                                  -----------   -----------   -----------  -----------   -----------    -----------


<S>                                               <C>           <C>           <C>          <C>           <C>            <C>
Balances, June 30, 2000                             3,029,870   $    75,747   $ 2,997,292  $  (458,970)  $   (21,635)   $ 2,592,434

         Net unrealized (losses) on
                  securities available for sale          --            --            --           --        (299,465)      (299,465)


         Net income for the year                         --            --            --        182,293          --          182,293
                                                  -----------   -----------   -----------  -----------   -----------    -----------



Balances, June 30, 2001                             3,029,870        75,747     2,997,292     (276,677)     (321,100)     2,475,262

         Net unrealized gains on
                  securities available for sale          --            --            --           --         244,339        244,339


         Net (loss) for the year                         --            --            --       (301,224)         --         (301,224)
                                                  -----------   -----------   -----------  -----------   -----------    -----------


Balances, June 30, 2002                             3,029,870   $    75,747   $ 2,997,292  $  (577,901)  $   (76,761)   $ 2,418,377
                                                  ===========   ===========   ===========  ===========   ===========    ===========
</TABLE>

           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       F-5
<PAGE>

<TABLE>
                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                   FOR THE YEARS ENDED JUNE 30, 2002 AND 2001
                   ==========================================
<CAPTION>

                                                                  For the Years Ended June 30,
                                                                      2002           2001
                                                                   -----------    -----------
<S>                                                                <C>            <C>
CASH FLOWS FROM (TO) OPERATING ACTIVITIES:
Net income (loss)                                                  $  (301,224)   $   182,293
  Adjustments to reconcile net income (loss) to net cash
     provided (used) by operating activities:
       Impairment allowance on notes receivable, related parties        31,342       (119,411)
       Depreciation and amortization                                    11,411         13,868
       Realized losses on sale of investment securities                212,186         32,973
       Deferred income taxes                                              --           (7,000)
  Changes in:
       Real estate development                                            --          939,199
       Accrued interest - related party                                 (8,750)          --
       Accrued liabilities and other                                     2,810          1,498
                                                                   -----------    -----------

         Cash Flows Provided (Used) By Operating Activities            (52,225)     1,043,420
                                                                   -----------    -----------

CASH FLOWS FROM (TO) INVESTING ACTIVITIES:
  Purchase of investment securities                                 (1,362,233)      (131,197)
  Proceeds from sale of investment securities                          126,449         49,989
  Investments in notes receivable - related parties                    (22,482)       (55,428)
  Collection on notes receivable - related parties                        --          565,979
  Issuance of note receivable - related party                         (250,000)          --
  Purchase of property and equipment                                      --           (3,189)
                                                                   -----------    -----------

         Cash Flows Provided (Used) By Investing Activities         (1,508,266)       426,154
                                                                   -----------    -----------


NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                (1,560,491)     1,469,574

CASH AND CASH EQUIVALENTS, beginning of year                         1,969,247        499,673
                                                                   -----------    -----------

CASH AND CASH EQUIVALENTS, end of year                             $   408,756    $ 1,969,247
                                                                   ===========    ===========
</TABLE>

           SEE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                       F-6
<PAGE>

                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Business
--------
Cambridge Holdings, Ltd. ("Cambridge" or "The Company") was incorporated on June
23, 1980 under the laws of the State of Colorado.  The Company has purchased two
undeveloped lots in the Cordillera Valley Club, located near Vail,  Colorado and
has sold the properties to two separate  limited  liability  companies  (LLC's).
With its partner in the LLC's, the Company has built a separate luxury residence
on each parcel for resale.  One of the  residences  was sold in April 2001.  The
Company  also  explores   other   business   acquisitions,   opportunities   and
investments.

In August 2000 the Company formed a wholly-owned  subsidiary,  CamCap,  Inc. The
subsidiary is inactive.

Consolidation
-------------
The  consolidated   financial  statements  include  the  accounts  of  Cambridge
Holdings, Ltd. and its wholly-owned subsidiary (the "Company").  All significant
intercompany balances and transactions have been eliminated in consolidation.

Concentrations of Credit Risk
-----------------------------
The Company's financial instruments that are exposed to concentrations of credit
risk consist  primarily of cash balances in excess of the insurance  provided by
governmental insurance  authorities.  The Company has not experienced any losses
on such accounts.

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

Investment Securities
---------------------
Investment securities classified as available for sale are those securities that
the Company  does not have the  positive  intent to hold to maturity or does not
intend to trade  actively.  These  securities  are  reported  at fair value with
unrealized  gains and losses reported as a net amount (net of applicable  income
taxes) as a separate component of stockholders' equity.

Fair Value of Financial Instruments
-----------------------------------
Unless otherwise specified, the Company believes the carrying value of financial
instruments approximates their fair value.

Revenue Recognition
-------------------
Interest and dividend income is recorded on the accrual basis.  Gains and losses
on sales of securities are recognized at time of sale.

                                       F-7
<PAGE>

                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 1 - NATURE OF  BUSINESS  AND  SUMMARY OF  SIGNIFICANT  ACCOUNTING  POLICIES
         (Continued)

Property and Equipment
----------------------
Property and equipment are recorded at cost.  Depreciation  expense is generally
provided on a  straight-line  basis using  estimated  useful lives of 3-5 years.
Total depreciation  expense was $11,411 and $13,868 for the years ended June 30,
2002 and 2001, respectively.

Investment in LLC
-----------------
The investments in LLC's are accounted for under the equity method.

Impairment of Long-Lived Assets
-------------------------------
The Company  evaluates its long lived assets by measuring the carrying amount of
the assets against the estimated  undiscounted future cash flows associated with
them. At the time such evaluations  indicate the future  undiscounted cash flows
of certain long lived assets are not  sufficient to cover the carrying  value of
such assets,  the assets are adjusted to their fair values.  As of June 30, 2002
the Company had recorded a cumulative allowance against its note receivable from
the Lot 19 LLC of $382,365 because management of the Company does not believe it
will realize the full amount due under the note receivable.

Income Taxes
------------
The  Company  follows  the  provisions  of  Statement  of  Financial  Accounting
Standards  No. 109 -  Accounting  for Income  Taxes.  Under  SFAS No.  109,  the
Company's  policy is to  provide  deferred  income  taxes  related to items that
result in  differences  between the financial  reporting and tax basis of assets
and liabilities.

Earnings Per Common Share
-------------------------
The Company  computes  earnings per common share in accordance with Statement of
Financial  Accounting Standards No. 128, Earnings Per Share (SFAS No. 128). This
Statement  simplifies  the  standards  for  computing  earnings  per share (EPS)
previously  found in Accounting  Principles  Board Opinion No. 15,  Earnings Per
Share, and makes them more comparable to international  EPS standards.  SFAS No.
128 replaces the  presentation  of primary EPS with a presentation of basic EPS.
In addition,  the Statement  requires dual presentation of basic and diluted EPS
on the face of the  income  statement  for all  entities  with  complex  capital
structures and requires a reconciliation of the numerator and denominator of the
basic EPS  computation  to the  numerator  and  denominator  of the  diluted EPS
computation.

Options to purchase  480,000 and 60,000 shares of common stock were not included
in  the  computation  of  diluted   earnings  per  share  as  their  effect  was
anti-dilutive for the years ended June 30, 2002 and 2001, respectively.

Cash and Cash Equivalents
-------------------------
Cash and cash  equivalents  include cash on hand and  investments  with original
maturities of three months or less.

                                       F-8
<PAGE>

                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 1 - NATURE OF  BUSINESS  AND  SUMMARY OF  SIGNIFICANT  ACCOUNTING  POLICIES
        (Continued)

Stock Option Plans
------------------
The Company applies Accounting Principles Board Opinion 25, Accounting for Stock
Issued  to  Employees,   ("APB  Opinion  25")  and  related  Interpretations  in
accounting  for all stock option  plans.  Under APB Opinion 25, no  compensation
cost has been recognized for stock options granted as the option price equals or
exceeds the market price of the underlying common stock on the date of grant.

Statement of Financial  Accounting Standards No. 123, Accounting for Stock-Based
Compensation,  ("SFAS No.  123")  requires  the  Company  to  provide  pro forma
information regarding net income as if compensation cost for the Company's stock
option plans had been  determined in accordance with the fair value based method
prescribed in SFAS.

Comprehensive Income (Loss)
---------------------------
FASB  Statement No. 130,  Reporting  Comprehensive  Income  (Loss)  requires the
reporting of  comprehensive  income (loss) in addition to net income (loss) from
operations.  Comprehensive income (loss) is a more inclusive financial reporting
methodology  that includes  disclosure  of certain  financial  information  that
historically has not been recognized in the calculation of net income (loss).

The change in net  unrealized  securities  gains  (losses)  recognized  in other
comprehensive income includes two components: (1) unrealized gains (losses) that
arose  during the period from changes in market  value of  securities  that were
held during the period (holding gains (losses)),  and (2) gains or (losses) that
were  previously  unrealized,  but have been  recognized  in current  period net
income  due to sales of  available-for  sale  securities  (reclassification  for
realized  gains).  This  reclassification  has no effect on total  comprehensive
income (loss) or shareholder's equity.

The  following  table  presents the  components  of other  comprehensive  income
(loss), net of tax:

   Years ended June 30, (net of tax)                      2002          2001
                                                        ---------     ---------

   Holding gains (losses)                               $ 466,451     $(364,028)
   Reclassification for realized gains (losses)          (222,112)       64,563
                                                        ---------     ---------

   Increase (decrease) in net unrealized securities
   gains (losses) recognized in other comprehensive
   income                                               $ 244,339     $(299,465)
                                                        =========     =========

                                       F-9
<PAGE>

                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 1 - NATURE OF  BUSINESS  AND  SUMMARY OF  SIGNIFICANT  ACCOUNTING  POLICIES
         (Continued)

Recently Issued Accounting Pronouncements
-----------------------------------------
The Securities and Exchange  Commission (SEC) issued Staff  Accounting  Bulletin
(SAB) 101, Revenue  Recognition in Financial  Statements,  in December 1999. The
SAB summarizes  certain of the SEC staff's views in applying  generally accepted
accounting  principles to revenue recognition in financial  statements.  In June
2000, the SEC issued SAB 101B, which delays the  implementation  date of SAB 101
until no later than the fourth fiscal  quarter of fiscal years  beginning  after
December 15, 1999.  The Company does not believe that  adoption of this SAB will
have a material impact on its financial statements.

In July 2001 the Financial Accounting Standards Board ("FASB") issued Statements
of Financial Accounting Standards No. 141, "Business  Combinations" ("SFAS 141")
and No. 142,  "Goodwill and Other  Intangible  Assets"  ("SFAS  142").  SFAS 141
requires all business combinations initiated after June 30, 2001 to be accounted
for using the purchase method.  Under SFAS 142,  goodwill and intangible  assets
with indefinite lives are no longer amortized but are reviewed annually (or more
frequently if impairment indicators arise) for impairment.  Separable intangible
assets  that  are not  deemed  to have  indefinite  lives  will  continue  to be
amortized over their useful lives (but with no maximum life).  The  amortization
provisions of SFAS 142 apply to goodwill and  intangible  assets  acquired after
June 30, 2001. With respect to goodwill and intangible  assets acquired prior to
July 1, 2001,  the Company  adopted SFAS 142 effective July 1, 2001 and does not
believe it will have a material impact on its financial statements.

In July 2001 the FASB  issued  SFAS No.  143,  Accounting  for Asset  Retirement
Obligations, which addresses accounting and reporting for obligations associated
with the  retirement  of tangible  long-lived  assets and the  associated  asset
retirement  costs. SFAS No. 143 will be effective for the Company for the fiscal
year  beginning  July 1, 2002 and early  adoption  is  encouraged.  SFAS No. 143
requires that the fair value of a liability for an asset's retirement obligation
be  recorded in the period in which it is incurred  and the  corresponding  cost
capitalized by increasing the carrying amount of the related  long-lived  asset.
The Company's adoption of the new standard did not have a material impact on its
financial statements.

In August 2001 the FASB issued SFAS No. 144,  Accounting  for the  Impairment or
Disposal of Long-Lived Assets. SFAS No. 144 is effective for the Company on July
1, 2002 and addresses accounting and reporting for the impairment or disposal of
long-lived  assets.  SFAS No. 144  supersedes  SFAS No. 121,  Accounting for the
Impairment of Long-Lived  Assets and for Long-Lived Assets to Be Disposed Of and
APB Opinion No. 30, Reporting the Results of Operations-Reporting the Effects of
Disposal  of a Segment of a  Business.  SFAS No.  144  retains  the  fundamental
provisions of SFAS No. 121 and expands the reporting of discontinued  operations
to include all components of an entity with operations that can be distinguished
from the  rest of the  entity  and  that  will be  eliminated  from the  ongoing
operations of the entity in a disposal  transaction.  The Company estimates that
the new standard will not have a material impact on its financial statements.

                                      F-10
<PAGE>


                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 1 - NATURE OF  BUSINESS  AND  SUMMARY OF  SIGNIFICANT  ACCOUNTING  POLICIES
         (Continued)

In April 2002, the FASB issued SFAS No. 145,  Rescission of FASB  Statements No.
4, 44, and 64,  Amendment of FAS  Statement  No. 13, and  Technical  Corrections
("SFAS 145").  This statement  rescinds the requirement in SFAS No. 4, Reporting
Gains and Losses from  Extinguishment of Debt, that material gains and losses on
the extinguishment of debt be treated as extraordinary items. The statement also
amends SFAS No. 13, Accounting for Leases, to eliminate an inconsistency between
the accounting for  sale-leaseback  transactions  and the accounting for certain
lease   modifications   that  have   economic   effects   that  are  similar  to
sale-leaseback   transactions.   Finally   the   standard   makes  a  number  of
consequential and other technical corrections to other standards. The provisions
of the statement  relating to the  rescission of SFAS 4 are effective for fiscal
years beginning after May 15, 2002.  Provisions of the statement relating to the
amendment of SFAS 13 are effective for transactions occurring after May 15, 2002
and the other provisions of the statement are effective for financial statements
issued on or after May 15,  2002.  The  Company  has  reviewed  SFAS 145 and its
adoption is not expected to have a material effect on its financial statements.

In July 2002 the FASB  issued  SFAS No.  146,  Accounting  for Exit or  Disposal
Activities  ("SFAS  146").  SFAS 146  applies to costs  associated  with an exit
activity  (including  restructuring)  or with a disposal of  long-lived  assets.
Those activities can include eliminating or reducing product lines,  terminating
employees and contracts, and relocating plant facilities or personnel.  SFAS 146
will  require a Company  to  disclose  information  about its exit and  disposal
activities,  the related  costs,  and changes in those costs in the notes to the
interim and annual financial statements that include the period in which an exit
activity  is  initiated  and in any  subsequent  period  until the  activity  is
completed.  SFAS 146  supersedes  Emerging  Issues  Task Force  Issue No.  94-3,
Liability  Recognition for Certain Employee Termination Benefits and Other Costs
to Exit an Activity  (including Certain Costs Incurred in a Restructuring),  and
requires liabilities associated with exit and disposal activities to be expensed
as  incurred  and  can  be  measured  at  fair  value.  SFAS  146  is  effective
prospectively for exit or disposal activities initiated after December 31, 2002,
with earlier adoption encouraged.  The  Company  has  reviewed  SFAS 146 and its
adoption is not expected to have a material effect on its financial statements.


NOTE 2 - INVESTMENT SECURITIES

At June 30, 2002 the  Company's  market value of available  for sale  securities
consisted of the following:
                                                Gross
                                             Unrealized    Estimated
                                    Cost       (Loss)      Fair Value
                                  ----------  ---------    ----------
Common and preferred stocks       $  999,678  $ (83,074)   $  916,604
Bond Funds                           617,528    (10,300)      607,228
                                  ----------  ---------    ----------

Total                             $1,617,206  $ (93,374)   $1,523,832
                                  ==========  =========    ==========

The Company  realized net (losses) of  $(212,185)  and  $(32,973) on the sale of
investment securities for the years ended June 30, 2002 and 2001, respectively.

                                      F-11
<PAGE>


                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 3 - INVESTMENT IN PARTNERSHIP

In 1997 the Company invested  $100,000 for a 10% interest in a partnership which
in turn  entered  into a bridge loan with a third  party.  During the year ended
June 30, 1999, the Company wrote off its investment in the partnership  totaling
$101,278 as it had not been repaid under the terms of the bridge loan  agreement
and  collection  was  doubtful.  The Company  pursued  litigation  and recovered
$35,270 and $70,000 during 2001 and 2000, respectively.

NOTE 4 - NOTES RECEIVABLE - RELATED PARTIES

In  February  1997  the  Company  became  a 50%  member  in each of two  limited
liability  companies with the Zneimer  Company,  a real estate  developer in the
Vail,  Colorado  area.  During the fiscal year ended June 30, 1997,  the Company
purchased  two parcels of raw land for  approximately  $723,000.  Each parcel of
land was conveyed to a separate limited  liability  company,  CVC Lot 2, LLC and
CVC Lot 19, LLC, in exchange for a secured  promissory note from the LLC's equal
to the Company's cost of the property.  Subsequently  the promissory  notes were
subordinated to secure  construction loans provided by a financial  institution,
the proceeds of which were used to build a luxury residence on each of the lots.

In April 2001 CVC Lot 2, LLC sold the property for approximately $1,565,000 less
property  costs,  closing  fees and  payments to the Zneimer  Company.  The sale
transaction  resulted  in a  reported  gain  to  the  Company  of  approximately
$148,000,  after considering an impairment allowance of approximately  $240,300,
which had previously been recorded.  The note receivable from CVC Lot 19, LLC is
due upon the sale of the  property  and  totaled  $150,000  after an  impairment
allowance  of $382,365 at June 30,  2002.  The Zneimer  Company and Mr.  Zneimer
personally guaranteed one half the original principal amount of the notes issued
to the  Company  simultaneously  with the  conveyance  of each  property  to the
applicable  limited  liability  company.  The Company  does not believe that Mr.
Zneimer would be able to meet the terms of the guarantee.

The note is classified as a related party  obligation  only due to the fact that
the CVC LLC is 50%  owned by  Cambridge.  The  management  of  Cambridge  has no
interest in these properties other than as a shareholder of Cambridge.

Separate  unaudited  condensed  statements of operations of CVC Lot 2, LLC up to
the date of sale and CVC Lot 19, LLC, on a combined basis are as follows:

                                           For the Years Ended
                                                June 30,
                                          ---------------------
                                            2002         2001
                                          --------    ---------
                                               (Unaudited)

           Revenue                        $ 35,948    $ 140,903
           Expenses                         40,227      310,634
                                          --------    ---------

           Net (loss) from operations     $ (4,279)   $(169,731)
                                          ========    =========

                                      F-12
<PAGE>


                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 4 - NOTES RECEIVABLE - RELATED PARTIES (Continued)

During January 2002 the Company loaned $250,000 to Advanced Nutraceuticals, Inc.
("ANI").  The 7% note matures in one year during January 2003 and is convertible
at the option of the Company into shares of ANI common stock at $1.00 per share.
ANI also  issued a warrant to the  Company  pursuant  to which the  Company  may
acquire  50,000 shares of ANI common stock at $1.00 per share through June 2004.
The Company's president is also the chairman of ANI.

As of August 26, 2002,  by mutual  agreement of the parties,  the $250,000  note
balance and interest  accrued to that time were converted into 475,118 shares of
ANI common stock. The terms of the warrant were not affected.

NOTE 5 - PROPERTY AND EQUIPMENT

Property and equipment consists of the following:

                                                             June 30,
                                                               2002
                                                            ----------
       Automobile                                           $  30,762
       Furniture and fixtures                                   1,200
       Office equipment                                        32,945
                                                            ----------

       Total                                                   64,907

       Less accumulated depreciation and amortization         (60,682)
                                                            ----------

                                                            $   4,225
                                                            ==========

NOTE 6 - INCOME TAXES (BENEFIT)

                                           For the Years Ended
                                                June 30,
                                          ---------------------
                                            2002         2001
                                          --------    ---------
           Deferred:
              Federal                     $     --    $  (7,000)
              State                             --           --
                                          --------    ---------

                                          $     --    $  (7,000)
                                          =====================


                                      F-13
<PAGE>


                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 6 - INCOME TAXES (BENEFIT) (Continued)
                                                           June 30,
                                                             2002
                                                          ----------
             Deferred tax assets:
                      Allowance for losses on
                         investments                     $  117,000
                      Impairment of note receivable          142,700
                      Net operating loss carryforward         91,000
                                                          ----------

                      Net deferred tax assets                350,700
                      Less valuation allowance              (268,700)
                                                          ----------

                      Net deferred tax assets                 82,000
                                                          ----------

             Deferred tax liability                           -
                                                          ----------

             Net deferred tax asset                       $   82,000
                                                          ==========

The Company has  recorded a deferred  tax asset of $82,000,  which  reflects the
amount of tax  benefit  expected  to be  realized  as a result of the  available
operating  loss  carryforward.  A valuation  allowance has been recorded for the
remainder of the deferred tax assets as  management  is not able to determine if
it is more  likely  than not that  certain  other  deferred  tax assets  will be
realized.

A reconciliation  of income tax expense  (benefit) at the federal statutory rate
to the effective tax rate is as follows:
                                               For the Years Ended June 30,
                                                    2002         2001
                                                 -----------  ----------
    Income tax expense (benefit) computed
        at the federal statutory rate            $(102,000)   $   60,000
    Increase in valuation allowance                146,000       (84,000)
    Other                                          (44,000)       17,000
                                                 -----------  ----------

    Income tax (benefit)                         $ --         $   (7,000)
                                                 ===========  ==========

The Company has a net operating  loss  carryforward  of  approximately  $245,000
expiring through 2022.


                                      F-14
<PAGE>



                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 7 - STOCK OPTIONS

1999 Stock Option Plan
----------------------
The Company's 1999 Stock Option Plan, as amended, has a maximum of 60,000 common
shares reserved to be issued to employees and  consultants  upon the exercise of
options  granted under the Plan. The option price of shares may not be less than
the fair market value of common stock on the date of grant.  The option price of
shares  issued  to more than 10%  shareholders  may not be less than 110% of the
fair market value of common stock on the date of grant.  The exercise  term will
not exceed ten years from the date of the grant. During 1999 the Company granted
60,000  options  under the plan,  which are  scheduled to expire April 15, 2004.
During 2002 10,000 options were forfeited.

2001 Stock Option Plan
----------------------
The  Company's  2001 Stock  Option  Plan,  as amended,  has a maximum of 650,000
common  shares  reserved  to be issued to  employees  and  consultants  upon the
exercise of options  granted under the Plan.  The option price of shares may not
be less than the fair  market  value of common  stock on the date of grant.  The
option price of shares issued to more than 10% shareholders may not be less than
110% of the fair market value of common stock on the date of grant. The exercise
term will not exceed ten years from the date of grant.  During  2002 the Company
granted 430,000 options under the plan;  280,000 will expire October 5, 2005 and
150,000 will expire November 27, 2005.

Pro Forma Stock Option Compensation
-----------------------------------
FASB Statement 123,  Accounting for Stock-Based  Compensation  ("SFAS No. 123"),
requires the Company to provide pro forma information regarding net loss and net
loss per share as if compensation costs for the Company's stock option plans and
other  stock  awards had been  determined  in  accordance  with fair value based
methods prescribed in SFAS No. 123. The Company estimates the fair value of each
stock award at the grant date by using the Black-Scholes  option-pricing  model.
There were no options granted during the year ended June 30, 2001.

During  2002 the  Company  granted  options  to certain  employees/directors  to
purchase 430,000 shares of the Company's  common stock  exercisable at $.47-$.52
per share. Had the Company adopted the fair value method with respect to options
issued to  employees/directors  an additional charge to income of $187,850 would
have been required in 2002;  proforma net loss would have been $489,074 and loss
per share would have been $.16 on a basic and diluted  basis.  In estimating the
above expense,  the Company used the  Black-Scholes  pricing model.  The average
risk-free interest rate used was 5.0%,  volatility was estimated at 498.80%, the
expected life was less than four years.

                                      F-15
<PAGE>



                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 7 - STOCK OPTIONS (Continued)

A summary of the Company's stock option plans,  outstanding  options and changes
during the years is presented below:
<TABLE>
<CAPTION>

                                                          For the Years Ended
                                                           June 30,
                                           ------------------------------------------
                                                   2002                   2001
                                           -------------------    -------------------
                                                      Weighted               Weighted
                                                      Average                Average
                                                      Exercise               Exercise
                                           Shares      Price      Shares      Price
                                           --------   --------    -------    --------
<S>                                          <C>      <C>          <C>       <C>
   Outstanding, beginning of year            60,000   $ .49500     90,000    $ .47677

                     Granted                430,000     .44800       -            -
                     Expired                (10,000)   (.52000)   (30,000)    (.44000)
                                           --------   --------    -------    --------
                     Exercised                -            -         -            -
                                           --------   --------    -------    --------

   Outstanding, end of year                 480,000   $ .45300     60,000    $ .49500
                                           ========   ========    =======    ========

   Options exercisable, end of year         480,000   $ .45300     60,000    $ .49500
                                           ========   ========    =======    ========

   Weighted average fair value of options
            granted during the year           -       $    -         -       $   -
                                           ========   ========    =======    ========
</TABLE>

The following table summarizes  information  about stock options  outstanding at
June 30, 2002:
<TABLE>
<CAPTION>


                                   Options Outstanding                                    Options Exercisable
           ------------------------------------------------------------------        -----------------------------
                                                    Weighted
                                                    Average         Weighted
               Range of                            Remaining        Average                       Weighted Average
               Exercise           Number          Contractual       Exercise            Number        Exercise
                Prices         Outstanding        Life-Years          Price          Exercisable         Price
                ------         -----------        ----------        -------          -----------  ----------------

<S>        <C>                 <C>                <C>              <C>                <C>             <C>
           $ .375 to $ .52       480,000            3.107          $.45300            480,000         $.45300
</TABLE>


                                      F-16
<PAGE>



                     CAMBRIDGE HOLDINGS, LTD. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                   ==========================================


NOTE 8 - RELATED PARTY TRANSACTIONS

The Company  shares  corporate  office  space and  administrative  staff with an
affiliate of the  Company.  The Company  paid its  affiliate  $750 per month for
these facilities and services. Cambridge's president is also president and Chief
Executive Officer of Advanced  Nutracueticals,  Inc. The Company held investment
securities  in ANI  classified  as  available  for sale and at June 30, 2002 and
2001;  the  investments  had an  estimated  fair value of $118,112  and $97,898,
respectively.

In December  2001 the Company  finalized an agreement to acquire  securities  of
AspenBio,  Inc. for  $600,000.  The Company  received  1,000,000  shares  (which
constituted at that time  approximately  11% of the outstanding  common stock of
AspenBio) and 360,000 warrants to purchase  AspenBio common stock exercisable at
$1.00 per share  through  January  1, 2007.  Certain  directors,  officers,  and
consultants  of the Company also  received an  aggregate of 470,000  warrants to
purchase  AspenBio  common  stock with the same  terms.  In  September  2002 the
Company  completed a distribution  to its  shareholders of 500,000 shares of the
AspenBio common stock.

The Company has  guaranteed on behalf of AspenBio,  Inc.  payment of a principal
amount  of  $200,000  plus  accrued  interest  payable  on  demand  by a lender.
AspenBio,  Inc.  issued a warrant to the Company to purchase  100,000  shares of
AspenBio  Common Stock at $1.50 per share,  expiring  July 5, 2005 in connection
with this  guarantee.  AspenBio  made a note to the Company to cover any amounts
the Company may be required to pay pursuant to the guarantee.

                                      F-17