<PAGE>

                                  UNITED STATES

                       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 fiscal year ended December 31, 2001

                                       OR

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

                  For the transition period from          to

                         Commission file number 0-30799

                            ONCURE TECHNOLOGIES CORP.
                 (Name of small business issuer in its charter)

                    FLORIDA                             59-3191053
        (State or other jurisdiction of              (I.R.S. Employer
         incorporation or organization)             Identification No.)

               7450 East River Road, Suite 300, Oakdale, CA 95361
          (Address of principal executive offices, including zip code)

         Issuer's telephone number, including area code: (209) 847-2273

    Securities registered pursuant to Section 12(b) of the Exchange Act: None

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

                          Common Stock, $.001 par value
                                (Title of Class)

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 (or for such shorter
period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. [X] Yes [ ] No

Check if there is disclosure of delinquent filers in response to Item 405 of
Regulation S-B is contained in this form, and no disclosure will be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-KSB or any
amendment to this Form 10-KSB. [X ]

The registrant's revenues for its most recent fiscal year were $22,732,308.

As of March 25, 2001, the aggregate market value of the registrant's voting and
non-voting common equity held by non-affiliates of the registrant, based on the
closing price for the registrant's Common Stock on the OTC Bulletin Board on
such date, was $4,959,960. This calculation does not reflect a determination
that certain persons are affiliates of the registrant for any other purpose.

As of March 25, 2001, the number of shares outstanding of the registrant's
common stock was 10,908,638.


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                               TABLE OF CONTENTS

                                    .........

<TABLE>
<CAPTION>
PART I                                                                                     Page
                                                                                           ----
<S>          <C>                                                                           <C>
     ITEM 1.  DESCRIPTION OF BUSINESS........................................................1
     ITEM 2.  DESCRIPTION OF PROPERTY.......................................................17
     ITEM 3.  LEGAL PROCEEDINGS.............................................................19
     ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS...........................20

PART II
     ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER..............................21
     ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF OPERATION ....................23
     ITEM 7.  FINANCIAL STATEMENTS..........................................................31
     ITEM 8.  CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
              DISCLOSURE....................................................................31

PART III
     ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE
              WITH SECTION 16 (a) OF THE EXCHANGE ACT.......................................32
     ITEM 10. EXECUTIVE COMPENSATION........................................................35
     ITEM 11. PRINCIPAL STOCKHOLDERS........................................................39
     ITEM 12. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS..........................41
     ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K..............................................43
</TABLE>




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                           FORWARD-LOOKING STATEMENTS

     Statements in this Annual Report that are not historical facts constitute
"forward-looking statements." Any statements contained herein which are not
historical facts or which contain the words "anticipate," "believe," "continue,"
"estimate," "expect," "intend," "may," "should," and similar expressions are
intended to identify forward-looking statements. Such statements reflect the
current view of the Company with respect to future events and are subject to
certain risks, uncertainties and assumptions, including, but not limited to, the
risk that the Company may not be able to implement its growth strategy in the
intended manner, including the ability to identify, finance, complete and
integrate acquisitions and joint venture opportunities, the ability to
successfully restructure under-performing facilities, the ability to meet
capital requirements, risks regarding currently unforeseen competitive pressures
and risks affecting the Company's industry, such as increased regulatory
compliance and changes in regulatory requirements, changes in payor
reimbursement levels and the development of additional alternative treatment
modalities and technological changes. In addition, the Company's business,
operations and financial condition are subject to the risks, uncertainties and
assumptions, which are described in the Company's reports and statements filed
from time to time with the Securities and Exchange Commission. Should one or
more of those risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from those
described herein.

                                     PART I

INTRODUCTION

     Throughout this Annual Report, the terms "OnCure", the "Company", "we",
"us" and "our" refer to OnCure Technologies Corp. and its subsidiaries, except
where it is made clear that such terms mean only OnCure Technologies Corp. or an
individual subsidiary.

ITEM 1.  DESCRIPTION OF BUSINESS

HISTORY

     The Company was incorporated in June 1993 under the laws of the State of
Florida. The Company conducts its business principally through its wholly-owned
subsidiary U.S. Cancer Care, Inc. Prior to the Company's reorganization with
U.S. Cancer Care, Inc. on December 5, 2000, the Company did not conduct
substantive business operations.

     U.S. Cancer Care, Inc. was incorporated in May 1998 under the laws of the
State of Delaware for the purpose of managing and operating outpatient radiation
therapy cancer treatment centers.

OVERVIEW

     The Company owns, operates and manages thirteen (13) radiation cancer
treatment centers. Our centers are designed and equipped to provide diagnostic
and treatment programs to cancer patients on an outpatient basis. We do not own
physician practices nor do we maintain any control over the provision of medical
services at our centers. We do, however, provide capital and management
resources to our affiliated physician groups, including clinical management,
billing and collection, data warehousing and other administrative services. See
"Management Information Systems" on page 6.

     Our goal is to become a leading network provider of radiation therapy
services in the United States through strategic relationships, new center
developments, prudent acquisitions and internal growth. The services we provide
are predicated upon state-of-the-art information systems and the delivery of
superior university level care in a cost efficient manner.

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         Set forth on the charts below are the names and locations of each of
our facilities and the approximate number of patients which could be treated at
the facility on a daily basis.

         CALIFORNIA

--------------------------------------------------------------------------------
FACILITY                                     CAPACITY TO TREAT ON A DAILY BASIS

--------------------------------------------------------------------------------
EAST BAY REGIONAL CANCER CENTER                                 100 patients
1034 A Street
Hayward, CA 94541
--------------------------------------------------------------------------------
ST. TERESA COMPREHENSIVE CANCER CENTER                          100 patients
4722 Quail Lakes Drive
Stockton, CA 95207
--------------------------------------------------------------------------------
SONORA CANCER CENTER                                            100 patients
1 South Forest Road
Sonora, CA 95370
--------------------------------------------------------------------------------
TURLOCK REGIONAL CANCER CENTER                                  100 patients
1051 East Tuolumne Road, Suite 103
Turlock, CA 95682
--------------------------------------------------------------------------------
VALLEY REGIONAL CANCER CENTER 1                                 100 patients
1316 Nelson Avenue
Modesto, CA 95350
--------------------------------------------------------------------------------
VALLEY REGIONAL CANCER CENTER 2*                                100 patients
1524 McHenry Ave.
Modesto, CA 95350
--------------------------------------------------------------------------------

         FLORIDA

--------------------------------------------------------------------------------
FACILITY                                     CAPACITY TO TREAT ON A DAILY BASIS

--------------------------------------------------------------------------------
FL CANCER CENTER - BEACHES                                      100 patients
1375 Roberts Drive
Jacksonville Beach, FL 32250
--------------------------------------------------------------------------------
FL CANCER CENTER - ORANGE PARK                                  100 patients
2161 Kingsley Ave.
Orange Park, FL 32073
--------------------------------------------------------------------------------
FL CANCER CENTER - PALATKA                                      100 patients
600 Zeagler Drive
Palatka, FL 32178
--------------------------------------------------------------------------------
FL CANCER CENTER - ST. JOHNS                                    100 patients
300 Health Park Blvd., Suite 1008
St. Augustine, FL 32086
--------------------------------------------------------------------------------
FLORIDA CANCER CENTER -                                         100 patients
WELLS COMPLEX CLINIC
3599 University Blvd. S., Suite 1500
Jacksonville, FL 32216
--------------------------------------------------------------------------------
RADIATION ONCOLOGY CENTER OF BRADENTON                          100 patients
6215 21st Ave. W., Suite B
Bradenton, FL 34209
--------------------------------------------------------------------------------



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         TEXAS

-------------------------------------------------------------------------------
FACILITY                                     CAPACITY TO TREAT ON A DAILY BASIS

-------------------------------------------------------------------------------
CALALLEN REGIONAL CANCER CENTER                                 100 patients
14120 F.M. 624
Corpus Christi, TX 78410
-------------------------------------------------------------------------------

         * The Company intends to close Valley Regional Cancer Center 2 due to
its history of losses, and to realize the benefit of cost savings by
consolidating such center with the Company's other center in Modesto.

         The Company's centers in Beaches, Corpus Christi, Orange Park, Palatka
and Stockton are "comprehensive" cancer treatment centers. Our comprehensive
centers provide treatment areas and equipment for medical oncology, radiation
therapy and diagnostic radiology. See "Radiation Therapy Treatment for Cancer."

         In addition to the thirteen (13) treatment facilities we operate and
manage, we own a mobile Positron Emission Tomography ("PET") scanner, which is
utilized to perform diagnostic tests on our cancer patients. PET is a highly
advanced nuclear medicine diagnostic study that involves the injection of
radioactive isotopes into a patient to obtain images of the metabolic
physiologic processes. The application of PET in the detection of cancer has
become significant in the last year, as it is the first diagnostic procedure
that can detect and monitor a patient's malignancies. Although PET has been in
existence for over 25 years, only recently has the U.S. Department of Health and
Human Services' Center for Medicare and Medicaid Services approved the
reimbursement of PET procedures performed for oncology patients. Our mobile PET
scanner services all five of our facilities in the Jacksonville area and two
large hospitals in Jacksonville and is the first of its kind to be licensed in
the State of Florida.

         We also own a mobile CAT-Scan Treatment Planning ("CT") system. CT
involves the use of a computer scan to visualize tumors in a 3 dimensional
format. Our Mobile CT scanner services all five of our facilities in the
Jacksonville area.

         We also own two High Dose Rate Brachytherapy ("HDR") units. HDR is a
time tested and safe method to treat cancer by providing high doses of radiation
directly to a tumor while sparing healthy tissue and surrounding organs. Our
mobile HDR unit services four of our centers in Northern California: East Bay
Regional Cancer Center (Hayward), St. Teresa Comprehensive Cancer Center
(Stockton), Valley Regional Cancer Center (Modesto) and Sonora Cancer Center
(Sonora). Our other HDR unit is located in our Radiation Oncology Center of
Bradenton.

         We also provide exclusive radiation oncology services to Kaiser
Permanente members in Hayward, Modesto and Stockton, California through an
agreement with The Kaiser Medical Group, Inc. Kaiser is a not-for-profit
group-practice health maintenance organization that has over three million
members in its enrollment in Northern California. Kaiser also operates 45
hospitals and clinics in Northern California. The Company's agreement at the
Hayward center terminates on August 1, 2002. We are in process of renegotiating
the term of this agreement.

CANCER AND ITS TREATMENT

         We believe that the market for radiation therapy services in the United
States is large and growing. Cancer is the second leading cause of death in the
United States and is responsible for one out of every four deaths. According to
the American Cancer Society, nearly 15 million new cancer cases have been
diagnosed since 1990 and approximately 1,284,000 new cancer cases will be
diagnosed in 2002. In addition, the American Cancer Society states that the
National Institutes of Health estimates that approximately $56 billion was spent
for direct medical costs (the total of all health expenditures) related to
cancer in 2001.

         Cancer consists of a group of more than 100 complex diseases
characterized by the uncontrolled growth and spread of abnormal cells.
Oncologists provide cancer care by utilizing the treatment modalities of
chemotherapy, radiation therapy, surgery and immunotherapy. Radiation therapy
involves the use of radiation energy to destroy cancer cells. We use radiation
therapy to cure cancer by destroying cancer cells and, where curing the cancer
is not possible, as a palliative treatment to eliminate pain, avoid hemorrhage,
prevent pathological bone fractures and other symptoms associated with



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metastasized cancer. Radiation therapy is often curative with patients in whom a
cancer is localized and has not metastasized. Most patients that receive
radiation therapy will experience short-term side effects. Some patients will
experience chronic or long-term side effects. The severity of both short-term
and long-term side effects varies among patients and depends on the part of the
body treated and the type of cancer involved.

         Cancer can also be treated through chemotherapy. Chemotherapy is the
use of "anticancer" drugs to destroy cancer cells by stopping them from growing
or multiplying. Chemotherapy does cause adverse side effects in some patients.
For this reason, the administration of chemotherapy requires the management of
not only the chemotherapy itself but of the potential adverse side effects as
well. Chemotherapy often cures certain leukemia, lymphomas and testicular
tumors. However, it is used mostly to palliate incurable metastasized disease.
Surgery is used in both the diagnosis and the treatment of cancer.
Immune-therapy is the treatment of cancer by enhancing the patient's own disease
fighting mechanisms, which involves advanced therapies, such as interferon (a
naturally occurring human protein capable of stopping the growth of cancer),
immunizing patients to their own cancer cells and, often, immune modifiers.
Immune-therapy is currently effective in some cases of malignant melanoma.
Increasingly, the effective treatment of cancer has involved the combination of
chemotherapy, radiation therapy and surgery.

         As a result of the complexity of cancer and the variety of cancer
therapies, physicians who treat cancer typically have had extensive, highly
specialized training. Radiation therapy is performed under the supervision of a
radiation oncologist who is thoroughly trained in clinical oncology, physics and
all of the modalities of therapeutic radiation in the treatment of cancer.

         The radiation therapy centers we own or manage focus on providing
radiation oncology treatment to cancer patients on an outpatient basis.
Radiation therapy treatment is performed with a linear accelerator, which uses
high-energy photons and/or electrons to destroy the tumor with minimal effect on
the area surrounding the tumor site. Treatment courses will usually last from
two to six weeks, during which time the patient is examined and monitored by a
radiation oncologist, a radiation therapist (a professional trained in the
planning and delivery of radiation therapy) and an oncology nurse (a
professional nurse trained in the care and treatment of patients undergoing
cancer therapy).

COMPANY STRATEGY

Focus on Radiation Therapy

         We believe that an opportunity exists to build a national outpatient
radiation therapy center network and radiation oncologist practice management
company focusing primarily on outpatient therapy. We base our belief on several
characteristics of the oncology market. First, cancer patients are a large,
well-defined and growing population that require regular costly medical
intervention over a period of months or years. Of this population, approximately
one-half of the individuals diagnosed with cancer receive at least one radiation
therapy treatment course, and sometimes several courses. Second, a relatively
small number of highly trained specialized oncologists are responsible for
treating this large portion of the cancer patient population. Third, managed
care and other payors are increasingly aware of the need for more coordinated,
cost-effective cancer care. Fourth, the outpatient radiation therapy market is
highly fragmented with no dominant providers.

OPERATING STRATEGY

         Our operating strategy consists of two key components. The first is to
affiliate with reputable radiation oncology and medical oncology groups or major
hospital and payor networks on joint venture outpatient facilities. The second
is a geographically concentrated outpatient network model.

Joint Venture Strategy

         Under our joint venture strategy, we begin by developing a center
(preferably a comprehensive treatment center) and funding all of its development
costs. We then provide radiation therapy services for the hospital and payor
networks in that area.

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         We are currently implementing this strategy in Northern California
through an agreement with Kaiser. Pursuant to the terms of this agreement, we:
(i) provide our facilities in Hayward and Stockton to Kaiser's members in this
region; (ii) provide all of the administrative services for the provision of
radiation oncology services at these facilities; and (iii) participate in, and
abide by, Kaiser's quality assessment and improvement plans.

         Our objective for our Hayward and Stockton facilities is to capture
non-Kaiser business in Northern California. This will decrease our reliance on
Kaiser's patient base. We have accomplished this objective at our Stockton
facility, where we lease space to a large non-Kaiser Permanente medical oncology
group.

Concentrated Outpatient Network Strategy

         Under our geographically concentrated outpatient network strategy, we
provide quality radiation therapy services to a large population of cancer
patients. We accomplish this through a centralized cancer facility that will
treat a majority of the cancer patients in the area by providing the most
sophisticated cancer therapy services. Within a certain radius of the central
cancer facility, we will have smaller satellite facilities that provide basic,
less technologically advanced services. This "hub and spoke" network model
provides us with the means of facilitating managed care contracts by providing
the wide spread geographic coverage that managed care providers seek for their
members.

         We are currently implementing this network model in Northern California
through our outpatient radiation therapy centers located in Hayward, Modesto,
Sonora, Stockton and Turlock. Our Modesto facility serves as our centralized
center in Northern California. The physician groups at our facilities in
Hayward, Sonora, Stockton and Turlock use the Modesto facility to provide
certain treatment modalities that are not available at their facilities. We are
also implementing this network model in Florida where our Orange Park center
serves as our comprehensive center and our outpatient radiation therapy centers
located in St. Augustine, Palatka, Jacksonville and Jacksonville Beach serve as
our "satellite facilities."

         Our satellite facilities located in Turlock, Sonora, Palatka and St.
Augustine are in rural areas. It would not be cost effective for us to develop
full service facilities in these areas. However, our network model enables us to
operate facilities in these less populated, more remote areas where few of our
competitors have facilities. As a result, we have been able to develop a patient
base in these areas.

         As noted above, we also own three (3) mobile units (PET scanner, CT
scanner and HDR treatment unit). Each of these scanners contributes to our
geographically concentrated outpatient network model by providing certain
diagnostic and treatment modalities that are not available at some of our
centers.

INTERNAL GROWTH

         After we develop or acquire an outpatient radiation therapy center and
establish an affiliation with a radiation oncology group in a particular market,
we seek to expand patient volume by:

          o    increasing and improving marketing efforts;

          o    entering into managed care contracts; and

          o    offering new state-of-the-art technologies (such as 3D Treatment
               Planning, Intensity Modulated Radiation Therapy, Positron
               Emission Tomography and Brachytherapy) not available in that
               area.

         In addition, the newly acquired or developed radiation therapy center
will utilize our management information system. The use of our management
information system will eliminate a significant portion of the administrative
duties associated with a radiation oncologist's practice. This will enable the
radiation oncology group affiliated with the center to serve patients and payors
more effectively and increase local market presence.

                                       5
<PAGE>

MANAGEMENT INFORMATION SYSTEM

         We provide each of our treatment centers with our proprietary
comprehensive radiation oncology management information system. The system is an
internet, web based and local area network practice tool, that provides our
treatment centers with three distinct functions: (i) clinical management; (ii)
billing and collection; and (iii) data warehousing.

         The clinical management function consists of the following major
functional areas:

          o    patient registration and demographic capture;

          o    managing and tracking health maintenance organization treatment
               authorizations;

          o    scheduling for physicians, simulations, treatments and lab
               visitation;

          o    drug and delivery service inventory management;

          o    billing capture and extraction;

          o    technical, professional and global billing capabilities;

          o    management reporting to monitor billing and utilization; and

          o    tracking of rudimentary clinical outcomes.

         The billing and collection function has a consistent internal control
function over billing charges and enables us to capture missed billable charges.
The billing and collection function consists of the following major functional
areas:

          o    automated bill creation and generation (electronic or paper
               form);

          o    automated carrier tracking including payments, write-offs,
               adjustments and appeals; and

          o    collection management.

         The data warehouse function is designed to report at all levels
including patient level, physician level, center level, regional level and
corporate level. The data warehouse function has the following reporting and
analysis capabilities:

          o    market analysis;

          o    managed care contracting;

          o    strategic planning;

          o    treatment outcomes;

          o    accounts receivables;

          o    profitability; and

          o    trending.

         We believe that OnCure's proprietary management system is more
sophisticated and less costly than other computerized information systems used
in the radiation oncology industry. Accordingly, we believe that the utilization
of our proprietary system will better enable us to effectively manage growth. In
addition, we believe that by allowing



                                       6
<PAGE>

nonaffiliated centers to use our management information system, we will be able
to establish a relationship with such centers, thereby increasing the potential
for an acquisition or management agreement with such centers.

         The Company plans to design numerous enhancements to the management
information system in 2002. The clinical management function will be expanded to
meet the specialized needs of medical oncology, as well as radiation oncology,
consistent with the Company's strategy to partner with medical oncologists. Our
design plans include migration of our system to a sequel server platform to
increase processing speeds and to enhance system expandability for business
growth. Our design plans also include enhancement of our system's functionality
in the following areas: billing capture and extraction, electronic interchange
with payors, clinical management, and management reporting.

MANAGEMENT SERVICES

         We provide management services to outpatient radiation therapy centers.
Our management services relate to the operation of such centers. We anticipate
that the management information systems component of these services initially
will be provided using our management information system. We believe our
management services eliminate a significant portion of the administrative duties
associated with a radiation oncologist's provision of radiation therapy
services, thereby enabling the radiation oncologist to devote a greater
percentage of his or her time to providing high-quality medical care.

AFFILIATION WITH LEADING RADIATION ONCOLOGY GROUPS, HOSPITALS AND MEDICAL
ONCOLOGY GROUPS

         Currently, we are not in the process of establishing any additional
affiliations. However, we hope to establish additional affiliations with leading
radiation oncology groups, medical oncology groups and hospitals in the future.
We will seek the following characteristics in potential candidates:

          o    the candidate must be affiliated with a leading radiation or
               medical oncology practice in its market, both in terms of market
               share and recognition as a provider of high quality oncology
               care;

          o    the candidate must incorporate comprehensive radiation therapy as
               an integral part of its care to its patients; and

          o    the candidate must recognize the need for outside managerial,
               financial and business expertise to manage the increasingly
               complex aspects of an outpatient radiation therapy practice.

         We believe our affiliation structure, which emphasizes the continuation
of local hospitals and physicians' authority and control over medical practice
decisions, will enhance the appeal of affiliation with us and our ability to
enter new markets.

NEGOTIATE/EXPAND MANAGED CARE RELATIONSHIPS

         We believe that managed care will continue to become an increasingly
important factor in the healthcare industry. We also believe that managed care
companies and other third-party payors increasingly will prefer to contract for
services with fewer vendors on a national or regional basis, and that the
development of a national network of established radiation oncology facilities
will provide our affiliated facilities with a competitive advantage in securing
such contracts on more favorable terms. We anticipate identifying desirable
managed care contracts and network affiliations, evaluating existing third-party
relationships and assisting the groups in establishing and expanding managed
care relationships.

FINANCIAL SERVICES; ADMINISTRATIVE SERVICES; PERSONNEL MANAGEMENT

         We attempt to improve the operating and financial performance of each
radiation therapy center we acquire. We develop a budget that involves the
adoption of financial controls and cost containment measures. We evaluate the
addition of advanced technologies to a center from a cost/benefit perspective.
We provide comprehensive financial analyses to the affiliated radiation
oncologist group and each radiation therapy center in connection with managed
care contracting. We provide billing, collection, reimbursement, tax and
accounting services and implement a cash management system.

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<PAGE>

         We also provide an array of administrative services to improve the
operations of the group. We utilize our management information system to support
our practice management services (including billing and collection, practice
analyses, patient and physician scheduling, maintenance of insurance
authorizations and the evaluation of referral patterns and managed care
proposals). We also purchase supplies, equipment, drugs and insurance,
frequently at volume discounts.

         We employ and manage all non-physician personnel of the radiation
oncology group, including dosimetrists, medical physicists, radiation therapists
and oncology nurses, as well as management information services, human
resources, secretarial and other administrative personnel. We evaluate these
employees, make staffing decisions, provide and manage employee benefits and
implement personnel policies and procedures. We also provide administrative
services to the physician group's employees.

COST CONTAINMENT AND OPERATING EFFICIENCIES

         The operation of an outpatient radiation therapy center includes a high
percentage of fixed costs and a low percentage of variable costs. As a result,
the operating leverage of a center may be very high with revenues in excess of
fixed costs.

         We implement, with respect to each of our acquired outpatient radiation
therapy centers, an internal financial and accounting control system to
consolidate administrative, accounting and purchasing functions. We accomplish
cost reduction by:

          o    capitalizing on economies of scale arising from our ability to
               negotiate discounts with both service, equipment and medical
               supply vendors as a result of consolidated purchasing power;

          o    centralizing human resources, accounting, billing and collection
               activities on a regional basis, resulting in a reduction of labor
               costs.

MEDICAL ADVISORY BOARD

         Our Medical Advisory Board is open to all physicians who are affiliated
with the Company's cancer centers. Currently, there are 17 members on the
Medical Advisory Board. Two of the seven members also serve on our Board of
Directors (Drs. Paryani and Wells) and the Chairman of the Medical Advisory
Board is the Chairman of our Board of Directors (Dr. Paryani). The primary
function of the Medical Advisory Board is to:

          o    develop and adopt policies, procedures and protocols to be
               implemented in the independent radiation therapy centers or to be
               used by the affiliated hospitals or the affiliated radiation
               oncology groups;

          o    develop and administer quality assurance programs, ensure all
               physician and other professional licensing and implement
               continuing education programs;

          o    formulate a strategic plan for each affiliated radiation oncology
               group designed to improve the performance of the related
               radiation therapy facility; and

         The Medical Advisory Board has been established to outline physician
recruiting goals, identify services and equipment to be added, identify
desirable payor relationships, identify other radiation oncology groups that are
possible affiliation candidates and to facilitate communication with other
affiliated physician groups in our network.

RADIATION THERAPY TREATMENTS FOR CANCER

         Through the use of our facilities and equipment, the radiation
oncologist medical groups with which we contract are able to offer a wide array
of radiation therapy services for outpatient cancer treatment. The radiation
oncologists (and not us) maintain full control over the provision of medical
services at our facilities.

         We seek to operate and manage additional outpatient radiation therapy
centers through various acquisitions. We anticipate that each of our centers
will be designed and



                                       8
<PAGE>

equipped to provide substantially all of the outpatient diagnostic and treatment
programs necessary to treat a cancer patient with radiation therapy. We intend
for our centers to provide many oncology services, all of which are typically
found only at university medical centers, including some or all of the
following:

          o    INTENSITY MODULATED RADIATION THERAPY, which involves the process
               of cross firing radiation beams to a tumor. This process of
               conformal radiation therapy allows the delivery of a high dose of
               radiation to the tumor while limiting the dose of radiation to
               adjacent healthy tissue.

          o    POSITRON EMISSION TOMOGRAPHY, which involves the injection of
               radioactive isotopes into a patient to obtain images of metabolic
               physiologic processes. Positron Emission Tomography provides
               information that is not available from other imaging
               technologies.

          o    STEREOTACTIC RADIOSURGERY, which targets brain tissues with
               multiple arcs of radiation and is used to treat deep-seated brain
               tumors.

          o    FRACTIONATED STEREOTACTIC RADIOSURGERY, which is a non-invasive
               technique similar to stereotactic radiosurgery permitting
               treatment of larger brain lesions.

          o    HIGH DOSE RATE BRACHYTHERAPY, which involves the use of
               radioactive materials (isotopes) placed directly in contact with
               cancer tissues, which are then removed when a lethal dose has
               been delivered to the cancer.

          o    3-DIMENSIONAL CONFORMAL TREATMENT PLANNING, which involves the
               use of a computer scan, allowing tumors to be visualized in a
               3-dimensional format. This makes it possible to treat the cancer
               volume with very narrow margins. By greatly decreasing the amount
               of normal tissue irradiated, treatment side effects are greatly
               reduced and often largely eliminated. This also permits the
               delivery of a larger lethal dose of radiation to the cancer.

          o    COMPUTERIZED CUSTOM TISSUE COMPENSATION, which involves a
               treatment planning mechanism to deliver a homogeneous dose of
               radiation to the entire tumor volume. This technique facilitates
               the delivery of a larger dose of radiation to the tumor, more
               successfully killing the cancer, while sparing the surrounding
               normal tissues, which reduces side effects.

          o    PROSTATE IMPLANTATION, which involves the use of Palladium
               "seeds" and other radioactive implants (radioactive isotopes) in
               the treatment of prostate cancer

          o    STRONTIUM 89 INJECTION, which is a radioactive injection therapy
               for widespread bone disease.

         Through our existing cancer center network we currently provide all of
these services. Furthermore, most of our centers have community rooms,
facilities for patient meetings, patient self-help and support programs,
counseling and education areas and training facilities.

MEDICAL ONCOLOGY TREATMENTS FOR CANCER

         As noted above, our centers in Beaches, Corpus Christi, Orange Park,
Palatka and Stockton are comprehensive cancer treatment centers. At these
centers, we provide treatment areas and equipment for medical oncology, as well
as radiation therapy and diagnostic radiology. The medical oncologists (and not
us) provide medical oncology services, all of which typically are found only at
university medical centers, including some of the following:

          o    Chemotherapy using oral or intravenous drugs to treat cancers
               that have a propensity to spread to other sites.

          o    Infusion therapy using special fluids such as blood or plasma to
               aid the cancer patient in recovering from the effects of therapy.

                                       9
<PAGE>

          o    Hormone therapy using specific drugs which are related to normal
               hormones and help fight certain cancers such as breast and
               prostate.

OTHER APPLICATIONS OF RADIATION THERAPY TREATMENTS FOR CANCER

         Endovascular Brachytherapy uses radioactive sources to apply internal
radiation to the wall of a blood vessel. This type of radiation therapy prevents
restenosis (inflammation and scarring that causes narrowing of the arteries
after angioplasty) of coronary arteries or peripheral arteries. The standard
therapy currently used for restenosis, or narrowing of the arteries, is
angioplasty with or without the use of stents. However, the restenosis rate
after angioplasty is over 75% in complex cases. Preliminary trials using
radiation therapy report restenosis rates of less than 10%.

         Currently, there are two techniques being utilized to deliver this
radiation treatment. The first involves the use of a high intensity Iridium-192
radioactive source that is a gamma emitter and the other uses a beta emitter
such as Phosporous-32.

         The radiation oncologists affiliated with our facilities in
Jacksonville, Florida are currently participating in clinical trials evaluating
the efficacy of the use of endovascular radiation therapy. It is estimated that
there are over 400,000 vascular interventions annually in the United States. The
Food and Drug Administration has approved the use of endovascular brachytherapy
in certain cases of coronary artery disease and the technique is currently being
utilized in Florida.

         Radioimmunotherapy involves the use of specific antibodies that are
tagged with radioactive isotopes. These antibodies seek out specific cancer
cells and deliver large amounts of radiation to the tumor while doing minimal
harm to normal cells. The FDA has recently approved the first radioimmunotherapy
agent, Zevalin (ibritmomab) to treat Non-Hodgkin's Lymphoma. Several patients
have already been treated at our centers in Florida with this innovative
technique which will soon be available at all our centers.

ACQUISITIONS AND NEW DEVELOPMENTS

         We believe there are, and will continue to be, many attractive
radiation therapy facility acquisition opportunities. We expect to acquire
outpatient radiation therapy centers from: (i) doctors who own and operate their
own centers and are seeking management expertise, access to managed care
contracts and other resources offered by multi-site providers, (ii) doctor
owners who are finding it increasingly difficult to remain competitive in the
face of managed care and new equipment technology upgrade demands, and (iii)
doctor owners who need to fulfill a desire to satisfy a diverse partner group of
age and objectives, and accordingly, seek to sell the technical component of
their centers while perpetuating the professional group. We also plan to enter
in strategic joint ventures with hospitals, large managed care organizations
(similar to Kaiser Permanente) and leading radiation oncology groups that desire
access to advanced radiation therapy technologies, but lack, or choose to
conserve their financial or managerial resources. In evaluating acquisition and
joint venture candidates, we analyze several strategic characteristics,
including:

          o    the reputation of the candidate;

          o    the geographic synergy of the location to existing facilities;

          o    the nature of the market;

          o    the presence and strength of local competition;

          o    financial data, including net revenues and operating income;

          o    history of payor reimbursement;

          o    referral patterns; and

          o    volume levels.

                                       10
<PAGE>

         We seek to develop preeminence in certain geographic regions within the
United States, thus developing a network of radiation therapy centers, which
permit us to benefit from economies of scale and obtain managed care contracts
on favorable terms.

         We have created an extensive database of existing outpatient radiation
therapy facilities for potential acquisitions. We have prioritized this
database, based upon an analysis of: (i) payor reimbursement patterns; (ii)
patient demographics; (iii) state health department regulations regarding
certificates of need; (iv) the geographic synergy of the location to existing
facilities; and (v) the physician group with which we would be affiliated. We
will need to obtain additional financing in order to implement such acquisition
opportunities.

         We believe that internal growth is critical to our overall acquisition
and development strategy. Our management fosters such internal growth through:
(i) marketing; (ii) entering into managed care contracts; (iii) offering
state-of-the-art technologies; and (iv) implementing OnCure's management
information system, which historically has added to the financial management
capabilities of each facility, in some cases allowing the capture of
approximately 15-30% of missed billings.

         In March 2002, the Company entered into a letter of intent with respect
to the acquisition of all of the outstanding capital stock of Coastal Radiation
Oncology Medical Group and its affiliates ("Coastal"). Coastal owns, operates
and manages eleven (11) treatment centers in California. The Company expects the
purchase price of the acquisition to be approximately $34 million, 80% payable
in cash and 20% payable in capital stock of the Company. The purchase price of
the acquisition is subject to adjustment upon completion of an audit of the
financial statements of Coastal. The transaction contemplated by the letter of
intent is subject to several material conditions including, among others, the
receipt of necessary financing, an audit of the financial statements of Coastal,
the approval of the Company's Board, the negotiation of definitive documentation
and the satisfactory completion of due diligence. There can be no assurance that
this transaction will be completed or that if completed, the terms will not
change.

         Due to changes in policies by the management at Columbia HCA Hospital
("HCA") regarding certain healthcare joint ventures, our joint venture with HCA
will terminate within the next six months. The Company intends to find a
different joint-venture partner for this center and is negotiating with the
radiation oncology group affiliated with this center in this regard. The Company
does not anticipate that this transaction will have any material effect on the
financial performance of the center.

         The Company sold its interest in the USCMC-USCC Partnership. See
"Certain Relationships and Related Party Transactions." As a result, the Company
will not be participating in any new developments that the USCMC-USCC
Partnership has the right to explore with Kaiser. The Company does not believe
that this transaction will have any material effect on the financial performance
of the Company's other centers in Northern California or the Company's existing
agreements with Kaiser.

COMPETITION

         The business of providing healthcare services generally, and of
providing oncology services specifically, is highly competitive. We are aware of
several competitors specializing in medical oncology practice management. As a
result of several market factors and of the increasing regulation of the
healthcare industry, we believe that others in the healthcare industry may adopt
strategies similar to those that we intend to adopt. These potential competitors
may have significantly greater resources than us.

         The principal competitive factors in our industry include, among
others: patient service and satisfaction; pricing; quality of care; radiation
oncologists' reputation, experience and expertise; strength of operational and
management information systems; technologically advanced equipment; managed care
expertise; patient referrals and access; management strength; regional network
area coverage; and quality assurance programs. Our centers face competition from
sole practitioners, single and multiple specialty physician groups, physician
practice management companies, hospitals and operators of other radiation
therapy centers. We may have to compete against these entities for patient
referrals, contracts with payors and/or acquisitions.

                                       11
<PAGE>

         We believe that while there are many medical oncology practice
management companies, there is no single dominant company in the outpatient
radiation therapy sector. We believe, based on available industry data, that
approximately 10% of the existing outpatient radiation therapy centers are owned
by a few public companies (excluding hospital inpatient facilities) and that the
ownership of the remaining centers is widely dispersed. However, most of these
companies do not focus primarily on the provision of radiation therapy. The
following table sets forth information about certain companies that currently
own outpatient radiation therapy facilities:


<TABLE>
<CAPTION>
                                                                                    ESTIMATED #
                                        TICKER                                      OF CENTERS
             COMPANY                    SYMBOL     PRINCIPAL BUSINESS               OWNED
             -------                    ------     ------------------               -----
<S>                                  <C>            <C>                            <C>
1.  US Oncology, Inc.                   USON       Medical Oncology                   77
                                                   Physician Practice Management

2.  21st Century Oncology, Inc          Private    Radiation Oncology                 22
                                                   Physician Practice Management

3.  Universal Health Services, Inc.     UHS        Hospitals                           9
</TABLE>

REIMBURSEMENT OF HEALTH CARE COSTS

         These are currently several federal and state initiatives relating to
the costs of healthcare services and the manner in which healthcare providers
are reimbursed for their services. It is not possible to predict whether any
such initiatives will be enacted or, if enacted, what their form, or impact on
the Company will be. Recently, Medicare reduced the rate in which healthcare
providers are reimbursed for providing certain radiation oncology services by
approximately 10-12%.

REGULATION

         The healthcare industry is highly regulated and changes in laws and
regulations can be significant. Changes in the law or new interpretation of
existing laws can have a material effect on our permissible activities, the
relative costs associated with doing business and the amount of reimbursement by
government and other third-party payors. The federal government and all states
in which we currently operate regulate various aspects of our business. Failure
to comply with these laws could adversely affect our ability to receive
reimbursement for our services and subject us and our officers and agents to
civil and criminal penalties.

Anti-kickback Statutes

         We are subject to federal and state laws, which govern financial and
other arrangements between healthcare providers. These include the federal
anti-kickback statute which, among other things, prohibits the knowing and
willful solicitation, offer, payment or receipt of any remuneration, direct or
indirect, in cash or in kind, in return for or to induce the referral of
patients for items or services covered by Medicare, Medicaid and certain other
governmental health programs. Violation of the anti-kickback statute may result
in civil or criminal penalties and exclusion from the Medicare, Medicaid and
other federal healthcare programs. In addition, it is possible that private
parties may file qui tam actions based on claims resulting from relationships
that violate this statute, seeking significant financial rewards. Many states
have enacted similar statutes, which are not limited to items and services paid
for under Medicare or a federally funded healthcare program. In recent years,
there has been increasing scrutiny by law enforcement authorities, the
Department of Health and Human Services ("HHS"), the courts and Congress of
financial arrangements between healthcare providers and potential sources of
referrals to ensure that such arrangements do not violate the anti-kickback
provisions. HHS and the federal courts interpret the anti-kickback statues
broadly to apply to a wide range of financial incentives, including, under
certain circumstances, distributions of partnership and corporate profits to
investors who refer federal healthcare program patients to a corporation or
partnership in which they have an ownership interest and to payments for service
contracts and equipment leases that are designed, even if only in part, to
provide direct or indirect remuneration for patient referrals or similar
opportunities to furnish reimbursable items or services. HHS issued "safe
harbor" regulations that set forth certain provisions which, if met, will assure
that healthcare providers and other parties who refer patients or other business
opportunities, or who provide reimbursable items or services, will be deemed not
to violate the anti-kickback statues. The safe harbors are narrowly drawn and
some of our relationships may not qualify for any "safe harbor", however,
failure to

                                       12
<PAGE>

comply with a "safe harbor" does not create a presumption of liability. We
believe that our operations materially comply with the anti-kickback statutes;
however, because these provisions are interpreted broadly by law enforcement
authorities, there can be no assurance that law enforcement officials or others
will not challenge our operations under these statutes.

Health Insurance Portability and Accountability Act

         In 1996, Congress passed the Health Insurance Portability and
Accountability Act ("HIPAA"), designed to guarantee the availability and
renewability of health insurance coverage for certain employees and individuals,
while also limiting the use of pre-existing condition restrictions. HIPAA also
made substantial amendments to federal healthcare fraud and abuse laws,
including:

          o    the establishment of fraud and abuse control programs to
               coordinate and fund the investigation and prosecution of
               healthcare fraud and abuse;

          o    the establishment of a Medicare integrity program, including
               medical, utilization and fraud review of Medicare providers;

          o    the extension of existing Medicare-Medicaid anti-fraud and abuse
               provisions to all federal healthcare programs;

          o    the provision of enhanced civil penalties; and

          o    the creation of new federal crimes of healthcare fraud and making
               false statements relating to healthcare matters.

         The healthcare fraud statute prohibits knowingly and willfully
executing a scheme to defraud any healthcare benefit program, including private
payors. A violation of this statute is a felony and may result in fines,
imprisonment or exclusion from government sponsored programs such as the
Medicare and Medicaid programs. The false statements statute prohibits knowingly
and willfully falsifying, concealing or covering up a material fact or making
any materially false fictitious or fraudulent statement in connection with the
delivery of or payment for healthcare benefits, items or services, including
those provided by non-government payors. A violation of this statute is a felony
and may result in fines or imprisonment. HIPAA requires health care providers to
maintain the privacy and security of health information. It will also require us
to follow federal standards for electronic transactions with health plans and
for protecting the privacy of individually identifiable health information and
the security standards for all electronic health information. The government
recently published regulations to implement the privacy standards under the Act,
however, a number of revisions were proposed recently and further changes may be
made before the regulations are finalized. We are beginning to address
compliance with the Act and applicable regulations. We expect to make the
necessary software upgrades to our propriety computer operating system to be
fully compliant with the HIPPA transactions standards by late 2002 and with the
privacy standards by 2003. A violation of the Act's health fraud, privacy or
security provisions may result in criminal and civil penalties, which may
adversely affect our business, financial condition and results of operations.

Stark II; State Physician Self-referral Laws

         A federal law, commonly known as the "Stark Law" or "Stark II", also
imposes civil penalties and exclusions from federal health programs for
referrals for "designated health services" by physicians or their family members
to certain entities with which they have a financial relationship (subject to
certain exceptions) and for claims for payments by entities receiving such
referrals. A private party may also bring a qui tam action in federal court on
the basis of a Stark Law violation. "Designated health services" include, among
other things, radiology services, including CAT-Scan Treatment Planning and
ultrasound, radiation therapy, and hospital inpatient and outpatient services.
The Stark Law does not require any fraudulent intent. Providers furnishing
services pursuant to a prohibited referral may not present a claim for the
services and if payments are made they may be recouped. The law applies directly
to services reimbursable by Medicare and may apply to services reimbursable
under Medicaid, depending on state law. Final regulations partially implementing
the Stark Law were issued in January 2001 and will become effective in April
2002. It is not clear when further regulations will be published, but the Center
for Medicare Medicaid Services ("CMS") has taken the position that the Stark Law
is self-effectuating and does not require implementing regulations. In addition,
several states in which we operate have enacted or are considering legislation
that that prohibits "self-referral" arrangements or requires physicians or other
healthcare providers to disclose to their patients any financial interest they
may have with a healthcare provider whom they recommend. Possible sanctions for
violating these provisions include loss of licensure and civil and criminal
sanctions. Such state laws vary from state to state and seldom have been
interpreted by the courts or regulatory agencies. Nonetheless, strict
enforcement of these requirements is likely. Although we believe our operations
materially comply with these federal



                                       13
<PAGE>

and state physician self-referral laws, there can be no assurance that Stark II
or other physician self-referral regulations will not be interpreted or applied
in a manner that would have a material adverse effect on our business, financial
condition and results of operations.

Fee-Splitting; Corporate Practice of Medicine

         The laws of many states prohibit physicians from splitting professional
fees with non-physicians and prohibit non-physician entities, such as us, from
practicing medicine and from employing physicians to practice medicine. These
laws and their interpretations vary from state to state and are enforced by
regulatory authorities with broad discretion. We will not employ physicians to
practice medicine, represent to the public that we offer medical services or
control the practice of medicine through ownership of our radiation therapy
centers or any management services rendered. Accordingly, we believe that we
will not be in violation of applicable state laws prohibiting treatment or other
medical decision making. However, because the laws governing the corporate
practice of medicine and fee-splitting vary from state to state, expansion of
our operations to a state with strict corporate practice of medicine laws may
require us to modify our operations with respect to one or more radiation
therapy centers, which may have adverse consequences on us. Further, there can
be no assurance that our arrangements will not be successfully challenged as
constituting the unauthorized practice of medicine or that certain provisions of
our agreements will be found to be unenforceable.

Federal False Claims Act

         There has been an increase in qui tam actions brought under the federal
False Claims Act and, in particular, under the False Claims Act's
"whistleblower" provisions. Those provisions allow a private individual to bring
actions in the name of the government alleging that the defendant has made false
claims for payment from federal funds. After the individual has initiated the
lawsuit, the government must decide whether to intervene in the lawsuit and to
become the primary prosecutor. Until then the lawsuit is kept secret. If the
government declines to join the lawsuit, the individual may choose to pursue the
case alone, in which case the individual's counsel will have primary control
over the prosecution, although the government must be kept apprised of the
progress of the lawsuit, and may intervene later. Whether or not the federal
government intervenes in the case, it will receive the majority of any recovery.
If the litigation is successful, the individual is entitled to no less than 15%,
but no more than 30%, of whatever amount the government recovers. The percentage
of the individual's recovery varies, depending on whether the government
intervened in the case and other factors. Recently, the number of suits brought
against healthcare providers by government regulators and private individuals
has increased dramatically. In addition, various states are considering or have
enacted laws modeled after the federal False Claim Act, penalizing false claims
against state funds. If a whistleblower action is brought against us, even if it
is dismissed with no judgment or settlement, we may incur substantial legal fees
and other costs relating to an investigation. Actions brought under the False
Claims Act may result in significant fines and legal fees and distract our
management's attention, which would adversely affect our business, financial
condition and results of operations.

         When an entity is determined to have violated the federal False Claims
Act, it must pay three times the actual damages sustained by the government,
plus mandatory civil penalties of between $5,500 to $11,000 for each separate
false claim, as well as the government's attorneys fees. Liability arises when
an entity knowingly submits, or causes someone else to submit, a false claim for
reimbursement to the federal government or submits a false claim with reckless
disregard for, or in deliberate ignorance of, its truth or falsity. Simple
negligence should not give rise to liability. Examples of the other actions,
which may lead to liability under the Act:

          o    Failure to comply with the many technical billing requirements
               applicable to our Medicare and Medicaid business.

          o    Failure to accurately identify and report our reimbursable and
               allowable services to Medicare.

          o    Failure to comply with the prohibition against billing for
               services ordered or supervised by a physician who is excluded
               from any federal healthcare programs, or the prohibition against
               employing or contracting with any person or entity from any
               federal healthcare programs.

          o    Failure to comply with Medicare physician supervision
               requirements for the services we provide, or the Medicare
               documentation requirements concerning physician supervision.

          o    The past conduct of the businesses we have acquired.

                                       14
<PAGE>

         We strive to ensure that we meet applicable billing requirements.
However, the costs of defending claims under the False Claims Act, as well as
sanctions imposed under the Act, could significantly affect our business,
financial condition and results of operations.

Radiologist and Facility Licensing

         The radiologists with whom we may enter into agreements to provide
professional services are subject to licensing and related regulations by the
states, including registrations to use radioactive materials. As a result, we
require our radiologists to have and maintain appropriate licensure. In
addition, some states also impose licensing or other requirements on us at our
facilities and other states may impose similar requirements in the future. Local
authorities may also require us to obtain various licenses, permits and
approvals. We believe that we have obtained all required licenses and permits;
however, there can be no assurance that additional laws and state licensure
requirements governing our facilities' operations will not be enacted.

Liability Insurance

         The physicians and other entities that use our systems and services are
involved in the delivery of healthcare services to the public and; therefore,
are exposed to the risk of liability claims. Our position is that we do not
engage in the practice of medicine. We provide only the equipment and technical
components of radiation therapy, and we have not experienced any material losses
due to claims for malpractice. Nevertheless, claims for malpractice have been
asserted against us in the past and any future claims, if successful, could
entail significant defense costs and could result in substantial damage awards
to the claimants, which may exceed the limits of any applicable insurance
coverage. We maintain professional liability insurance in amounts we believe are
adequate for our business of providing cancer treatment and management services.
In addition, the radiologists or other healthcare professionals with whom we
contract are required by such contracts to carry adequate medical malpractice
insurance. Successful malpractice claims asserted against us, to the extent not
covered by our liability insurance, could have a material adverse effect on our
business, financial condition and results of operations.

Certificates of Need

         Some states require hospitals and certain other healthcare facilities
and providers to obtain a Certificate of Need ("CON") or similar regulatory
approval prior to the commencement of certain healthcare operations or services,
the incurring of certain capital expenditures and/or the acquisition of major
medical equipment. CON regulations may limit or preclude us from providing
services in certain states. We believe that we have complied or will comply with
applicable CON requirements in those states where we operate. Nevertheless, a
significant increase in the number of states regulating our business within the
CON or state licensure framework could adversely affect our business, financial
condition and results of operations. Conversely, repeal of existing CON
regulations in jurisdictions where we have obtained or operate under a CON could
also adversely affect our business, financial condition and results of
operations, since CON regulation effectively functions as a barrier to entry.
This is an area of continuing legislative activity, and there can be no
assurance that CON and licensing statutes will not be modified in the future in
a manner that may have a material adverse effect on our business and operations.

Regulatory Compliance

         We believe that healthcare regulations will continue to change and we
intend to regularly monitor developments in healthcare law. We expect to modify
our agreements and operations from time to time as the business and regulatory
environment changes. While we believe we will be able to structure all our
agreements and operations within applicable law, there can be no assurance that
our arrangements will not be successfully challenged.

                                       15
<PAGE>

TECHNOLOGICAL AND THERAPEUTIC CHANGES IN CANCER TREATMENT

The treatment of cancer patients is subject to potentially revolutionary change.
Although radiation therapy equipment has remained relatively free of technical
obsolescence since the commercial introduction in the early 1970s of the linear
accelerator (which produces radiation artificially, rather than by using the
radiation emitted by natural cobalt isotopes), future technological developments
may render our equipment obsolete. Significant costs may have to be incurred to
replace or modify our existing equipment in which we have a substantial
investment. In addition, advances in other cancer treatment methods, such as
chemotherapy, surgery and immunotherapy, or in cancer prevention techniques, may
reduce demand or eliminate the need for the radiation therapy services provided
by us.

EMPLOYEES

As of March 15, 2002, we employed approximately 119 persons. We consider our
employee relations to be satisfactory.

TERMINATION DATES OF OUR MEDICAL SERVICES AGREEMENTS

         The radiation oncologists practicing at our centers are affiliated with
a professional corporation or partnership that has contracted with us to provide
medical services at our facilities. Set forth on the chart below is the
termination date of each agreement.

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------
                   FACILITY                     TERMINATION DATE OF THE FACILITY'S MEDICAL
                                                            SERVICES AGREEMENT
---------------------------------------------------------------------------------------------
<S>                                            <C>
Calallen Regional Cancer Center                December 1, 2002, with four consecutive
                                               renewals to December 1, 2016
---------------------------------------------------------------------------------------------
East Bay Regional Cancer                       July 31, 2005  (1)(2)
Center
---------------------------------------------------------------------------------------------
Florida Cancer Center - Beaches                October 12, 2008 with a renewal to October
                                               12, 2018 (1)
---------------------------------------------------------------------------------------------
Florida Cancer Center - Orange Park            October 12, 2008 with a renewal to October
                                               12, 2018 (1)
---------------------------------------------------------------------------------------------
Florida Cancer Center - Palatka                October 12, 2008 with a renewal to October
                                               12, 2018 (1)
---------------------------------------------------------------------------------------------
Florida Cancer Center - St. Johns              October 12, 2008 with a renewal to October
                                               12, 2018 (1)
---------------------------------------------------------------------------------------------
Florida Cancer Center - Wells Complex Clinic   October 12, 2008 with a renewal to October
                                               12, 2018 (1)
---------------------------------------------------------------------------------------------
Radiation Oncology Center of Bradenton         Month to Month (3)
---------------------------------------------------------------------------------------------
St. Teresa Cancer Comprehensive                December 1, 2011, with a renewal to
Center                                         December 1, 2016
---------------------------------------------------------------------------------------------
Sonora Cancer Center                           July 1, 2002 (4)
---------------------------------------------------------------------------------------------
</TABLE>


                                       16
<PAGE>

------------------------------------------------------------------------------
Turlock Regional Cancer                          July 1, 2002 (4)
Center
------------------------------------------------------------------------------
Valley Regional Cancer                           July 1, 2002 (4)
Patient Care Center 1
------------------------------------------------------------------------------
Valley Regional Cancer                           July 1, 2002 (4)
Patient Care Center 2
------------------------------------------------------------------------------

(1)  The termination date of each agreement is subject to certain conditions
     (none of which have yet to occur), which would have the effect of
     accelerating the termination date.

(2)  The Company is currently negotiating a new agreement with The Kaiser
     Permanente Group, which is anticipated to be between two and three years.

(3)  The Company is currently negotiating with the existing radiation
     oncologists for a new long-term agreement. See "Acquisitions and New
     Developments", with respect to the Company's Bradenton center.

(4)  The Company has terminated the medical service agreements at these centers
     effective July 1, 2002. The physicians, which were a party to the
     terminated medical services agreement, are providing medical services to
     patients under terms similar to the terminated agreement. The Company is
     negotiating with Dr. John J. Fuery to allow the existing physicians to
     contract with the Company directly. See "Litigation."

ITEM 2.  DESCRIPTION OF PROPERTY

         The following table contains information concerning our real property
that we own or lease and which we consider important to our business.


<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------
          NAME & LOCATION                   GENERAL CHARACTER & USE                       OTHER
------------------------------------------------------------------------------------------------------------------
<S>                                  <C>                                   <C>
CALALLEN REGIONAL CANCER CENTER (1)  7,229 square feet, used for medical   This facility is owned subject to a
14120 F.M. 624                       oncology, radiation therapy,          $1.4 million mortgage issued by one
Corpus Christi, TX 78410             diagnostic radiology, brachytherapy   of our stockholders, DVI Financial
                                     and seed implantations.               Services.
------------------------------------------------------------------------------------------------------------------
EAST BAY REGIONAL CANCER CENTER      8,317 square feet, used for           We lease this facility from a
1034 A Street                        radiation therapy, diagnostic         corporation owned by one of our
Hayward, CA 94541                    radiology and brachytherapy.          stockholders, John J. Fuery.
                                                                           This lease expires on March 31, 2006.
------------------------------------------------------------------------------------------------------------------
EXECUTIVE OFFICE                     500 square feet.                      We lease this facility from an
620 Newport Center Drive                                                   unaffiliated company. This lease
Suite 1109                                                                 expires on October 31, 2002.
Newport Beach, CA 92660
------------------------------------------------------------------------------------------------------------------
FLORIDA CANCER CENTER - BEACHES      5,876 square feet, used for medical   We lease this facility from an
1375 Roberts Drive                   oncology, radiation therapy and       unaffiliated company. This lease
Jacksonville Beach, FL 32250         diagnostic radiology.                 expires on January 31, 2007.
------------------------------------------------------------------------------------------------------------------
FLORIDA CANCER CENTER - ORANGE PARK  7,500 square feet, used for medical   We lease this facility from a
2161 Kingsley Ave.                   oncology, radiation therapy,          corporation that is partially owned
Orange Park, FL 32073                diagnostic radiology and seed         by two members of the Board, Shyam B.
                                     implantation.                         Paryani and John W. Wells. This lease
                                                                           expires on September 30, 2004.
------------------------------------------------------------------------------------------------------------------
</TABLE>


                                       17
<PAGE>
<TABLE>
<CAPTION>
<S>                                  <C>                                          <C>
------------------------------------------------------------------------------------------------------------------
FLORIDA CANCER CENTER - PALATKA      3,500 square feet, used for medical   We lease this facility from a
600 Zeagler Drive                    oncology, radiation therapy,          corporation that is partially owned
Palatka, FL 32178                    diagnostic radiology and seed         by two members of the Board, Shyam B.
                                     implantation.                         Paryani and John W. Wells. This lease
                                                                           expires on January 31, 2003
------------------------------------------------------------------------------------------------------------------
FLORIDA CANCER CENTER - ST. JOHNS    7,000 square feet, used for           We lease this facility from an
300 Health Park Blvd.                radiation therapy, diagnostic         unaffiliated company. This lease
Suite 1008                           radiology and seed implantation.      expires on December 31, 2006.
St. Augustine, FL 32086
------------------------------------------------------------------------------------------------------------------
FLORIDA CANCER CENTER - WELLS        3,000 square feet, used for           We own the building and lease the
COMPLEX CLINIC                       radiation therapy, diagnostic         land from an unaffiliated company.
3599 University Blvd.                radiology, brachytherapy and seed     This lease expires on March 5, 2030.
Suite 1500                           implantation.
Jacksonville, FL. 32245
------------------------------------------------------------------------------------------------------------------
OAKDALE CORPORATE OFFICE             8,000 square feet, used as our        We lease this facility from an
7450 E. River Road                   corporate headquarters.               unaffiliated company. This lease
Suite 3                                                                    expires on December 31, 2002.
Oakdale, CA 94361
------------------------------------------------------------------------------------------------------------------
RADIATION ONCOLOGY CENTER OF         13,000 square feet, used for          We own the building and lease the
BRADENTON                            radiation therapy, diagnostic         land from an unaffiliated company.
6215 21st Ave. W.                    radiology and brachytherapy.          This land lease expired on February
Suite B                                                                    28, 2002.  We are currently leasing
Bradenton, FL 34209                                                        the land on a month-to-month basis
                                                                           while we negotiate the terms of a new
                                                                           lease.
------------------------------------------------------------------------------------------------------------------
ST. AUGUSTINE CENTER                 5,000 square feet, unoccupied.        We sublease this facility for $1,800
1375 Arapaho Ave.                                                          per month.
St. Augustine, FL, 32086
------------------------------------------------------------------------------------------------------------------
ST. TERESA CANCER COMPREHENSIVE      6,857 square feet, used for medical   We sublease approximately half the
CENTER                               oncology, radiation therapy,          space at this facility to a medical
4722 Quail Lakes Drive               diagnostic radiology, brachytherapy   oncology group for approximately
Stockton, CA 95207                   and seed implantation.                $4,167 per month. This lease expires
                                                                           on June 30, 2005.
------------------------------------------------------------------------------------------------------------------
SONORA CANCER CENTER                 3,500 square feet, used for           We lease this facility from a
1 South Forest Road                  radiation therapy, diagnostic         corporation owned by one of our
Sonora, CA 95370                     radiology, brachytherapy and seed     shareholders, John J. Fuery.
                                     implantation.                         This lease expires on August 31, 2007.
------------------------------------------------------------------------------------------------------------------
TURLOCK REGIONAL CANCER              2,911 square feet, used for           We lease this facility from a
CENTER                               radiation therapy and diagnostic      corporation owned by one of our
1051 East Tuolumne Road              radiology and 3,846 square feet of    shareholders, John J. Fuery.
Suite 103                            unfinished space.                     This lease expires on March 31, 2006.
Turlock, CA 95682
------------------------------------------------------------------------------------------------------------------
VALLEY REGIONAL CANCER               8,600 square feet, used for           This facility is owned subject to an
PATIENT CARE CENTER 1 (2)            radiation therapy, diagnostic         $800,000 mortgage issued by one of
1316 Nelson Avenue                   radiology and seed implantation.      our stockholders, DVI Financial
Modesto, CA 95350                                                          Services.
------------------------------------------------------------------------------------------------------------------
VALLEY REGIONAL CANCER               3,608 square feet, used for           We lease this facility on a
PATIENT CARE CENTER 2                radiation therapy, diagnostic         month-to-month basis with plans to
1524 McHenry Ave.                    radiology and brachytherapy.          terminate the lease in May of 2002.
Modesto, CA 95350
------------------------------------------------------------------------------------------------------------------
</TABLE>

                                       18
<PAGE>

(1)  The Company has listed this property for sale with a condition to leaseback
     the facility from the new owner.

(2)  On March 1, 2002, the Company signed a sale/leaseback agreement with an
     unaffiliated corporation. The agreement provides for a 60 day period in
     which the buyer may perform certain due diligence and satisfy
     contingencies.

     All of the above related party transactions were the result of arms length
negotiations. We believe that each transaction was on terms fair to us and at
least as favorable to us as those available from unaffiliated third parties.

     We believe that our centers and equipment are in good working condition and
are adequate for our needs.

ITEM 3.  LEGAL PROCEEDINGS

     On October 23, 2001, our wholly owned subsidiary, U.S. Cancer Care,
instituted a lawsuit in the Superior Court of the State of California for the
County of Alameda against two of our former directors and certain entities
controlled by them. On February 28, 2002, we entered into a settlement agreement
with one of the former directors, W. Brian Fuery, and each of the entities
controlled by him, Stunner Corporation and U.S. Cancer Management Corporation.
In light of the settlement, Dr. John J. Fuery and Oncology Corporation (a
company controlled by Dr. Fuery) are the only adverse parties remaining in this
litigation.

     Our complaint includes the following allegations:

o    Dr. Fuery, while serving as a member of the Board, misrepresented the
     quality of certain medical equipment sold to us by Oncology Corporation. We
     are seeking the recovery of the consideration paid for such equipment and
     unspecified monetary damages in connection with this claim.

o    Dr. Fuery, while serving as a member of the Board, interfered with our
     operations. We are seeking unspecified monetary damages in connection with
     this claim.

     In response to our complaint, the defendants in this action filed an answer
     and a cross-complaint. Their answer generally denied the allegations of our
     complaint. Their cross-complaint includes the following allegations.

o    The non-compete provision of an agreement between the Company and Dr. Fuery
     is unenforceable.

o    The Company misrepresented that it would purchase medical equipment from
     Dr. Fuery. Dr. Fuery seeks unspecified monetary damages in connection with
     each of the claims arising out this matter.

o    The Company damaged Oncology Corporation's easement over certain real
     property by operating heavy equipment over the property. Oncology
     Corporation seeks unspecified monetary damages in connection with each of
     the claims arising out of this matter.

o    The Company defamed Dr. Fuery. Dr. Fuery seeks unspecified monetary damages
     in connection with each of the claims arising out of this matter.

o    The Company is obligated to defend and indemnify Dr. Fuery for the claims
     asserted against him in the complaint.

     We believe that we will be successful in prosecuting our complaint and
defending against Dr. Fuery's and Oncology Corporation's cross-complaint.

                                       19
<PAGE>

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

         The annual meeting of shareholders of the Company was held on December
3, 2001. At the annual meeting, the shareholders of the Company were asked to
vote upon the following proposals.

          1.   To elect each of Jeffrey A. Goffman, Charles J. Jacobson, Shyam
               B. Paryani, Gordon C. Rausser, Stanley S. Trotman, Jr., John W.
               Wells, Jr. and John H. Zeeman to serve as a member of the Board
               until the next annual meeting of shareholders of the Company and
               until the election and qualification of his successor.

          2.   To vote upon a proposal to approve the OnCure Technologies 2001
               Stock Option Plan.

         Each proposal was duly approved by the shareholders of the Company. Set
forth below is a tabulation of the results of each proposal submitted to the
shareholders of the Company.


<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------
                                  Votes For   Votes Against   Abstentions   Broker Non-Votes
---------------------------------------------------------------------------------------------
1. ELECTION OF DIRECTORS
---------------------------------------------------------------------------------------------
<S>                              <C>             <C>               <C>             <C>
Jeffrey A. Goffman               10,672,335      19, 275           0               0
---------------------------------------------------------------------------------------------
Charles J. Jacobson              10,672,335      19, 275           0               0
---------------------------------------------------------------------------------------------
Shyam B. Paryani                 10,672,335      19, 275           0               0
---------------------------------------------------------------------------------------------
Gordon C. Rausser                10,672,335      19, 275           0               0
---------------------------------------------------------------------------------------------
Stanley S. Trotman, Jr.          10,672,335      19, 275           0               0
---------------------------------------------------------------------------------------------
John W. Wells, Jr.               10,672,335      19, 275           0               0
---------------------------------------------------------------------------------------------
John H. Zeeman                   10,672,335      19, 275           0               0
---------------------------------------------------------------------------------------------
2. STOCK OPTION PLAN
---------------------------------------------------------------------------------------------
OnCure Technologies 2001 Stock    8,124,687       47,770       1,836,443        682,710
Option Plan
---------------------------------------------------------------------------------------------
</TABLE>

                                       20
<PAGE>

                                     PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

         Our common stock is traded on the OTC Bulletin Board under the symbol
"ONCU." The high and low closing sale prices of our common stock, as reported by
the OTC, were as follows for the quarterly periods indicated below. The
quotations below reflect inter-dealer prices, without retail mark-up, mark-down,
or commission and may not represent actual transactions.

                                                PRICE ($) PER SHARE
                                           -------------------------------
FISCAL 2001                                     HIGH           LOW
-----------                                -------------- ----------------
First quarter                                  $2.719         $0.281
Second quarter                                  1.600          0.630
Third quarter                                   0.900          0.150
Fourth quarter                                  1.010          0.360

FISCAL 2000

First quarter                                   0.325          0.015
Second quarter                                  0.130          0.020
Third quarter                                   0.030          0.009
Fourth quarter                                  0.625          0.156


NUMBER OF HOLDERS

         As of December 31, 2001, there were approximately 187 holders of record
of our common stock.

DIVIDENDS

         We have not declared or paid any cash dividends on our common stock.
The payment of cash dividends in the future will depend on our earnings,
financial condition, capital needs and other relevant factors. We do not intend
to pay dividends on our shares of common stock but intend to retain our earnings
for use in our business.

RECENT SALES OF UNREGISTERED SECURITIES

         In February 2000, Mitchell Hymowitz was issued 39,500 shares (as
adjusted for the Reverse Stock Split) of our common stock as compensation for
services performed. This transaction was made in reliance upon an exemption from
the registration requirements of the Act provided by Section 4(2) of the Act.

         In December 2000, we acquired (i) all of the issued and outstanding
stock of U.S. Cancer Care in exchange for 6,666,942 shares of the Company; (ii)
all of the series A preferred stock of U.S. Cancer Care in exchange for 1,000
shares of our Series B Preferred Stock; and (iii) all of the series B preferred
stock of U.S. Cancer Care in exchange for 1,000 shares of our Series C Preferred
Stock. This transaction was made in reliance upon an exemption from the
registration requirements of the Act provided by Section 4(2) of the Act.

         In January 2001, we acquired all of the series C preferred stock of
U.S. Cancer Care in exchange for 1,000 shares of our Series D Preferred Stock.
This transaction was made in reliance upon an exemption from the registration
requirements of the Act provided by Section 4(2) of the Act.

         In January 2001, Alpine Venture Capital Partners acquired $2,000,000 of
our Series E Preferred Stock. This transaction was made in reliance upon an
exemption from the registration requirements of the Act provided by Section 4(2)
of the Act.

                                       21
<PAGE>

         In January 2001, Mercurius Beleggingsmaatchappij BV acquired $1,000,000
of our Series E Preferred Stock. This transaction was made in reliance upon an
exemption from the registration requirements of the Act provided by Section 4(2)
of the Act. Participatie Maatschappij Avanti Limburg BV or

         In January 2001, Participatie Maatschappij Avanti Limburg BV acquired
$1,000,000 of our Series E Preferred Stock. This transaction was made in
reliance upon an exemption from the registration requirements of the Act
provided by Section 4(2) of the Act.

         In January 2001, we granted Mitchell Hymowitz an option to purchase
200,000 shares of our common stock, at an exercise price equal to $.01 per
share, as compensation for services performed for and expensed to Worldwide
Equipment, Inc. and prior to the reorganization with U.S. Cancer Care. This
transaction was made in reliance upon an exemption from the registration
requirements of the Act provided by Section 4(2) of the Act.

         In January 2001, we issued Dr. John J. Fuery an option to purchase
92,300 shares of our common stock, at an exercise price equal to $.01 per share,
as compensation for services performed in connection with our reorganization
with U.S. Cancer Care. This transaction was made in reliance upon an exemption
from the registration requirements of the Act provided by Section 4(2) of the
Act.

         In January 2001, we issued W. Brian Fuery an option to purchase 37,700
shares of our common stock, at an exercise price equal to $.01 per share, as
compensation for services performed in connection with our reorganization with
U.S. Cancer Care. This transaction was made in reliance upon an exemption from
the registration requirements of the Act provided by Section 4(2) of the Act.

         In March 2001, Ocean Crest Merchants Group was issued 175,000 shares of
our common stock in accordance with the terms of conversion of a promissory
note. This transaction was made in reliance upon an exemption from the
registration requirements of the Act provided by Section 4(2) of the Act.

         In March 2001, we issued 330,000 shares of our common stock to
Continuum Capital Partners, Inc. and granted Continuum Capital Partners, Inc. a
warrant to purchase 307,692 shares of our common stock, at an exercise price
equal to $1.30 per share. The shares of our common stock were issued, and the
warrant to purchase shares of our common stock was granted, as compensation for
services performed in connection with our reorganization with U.S. Cancer Care.
Each transaction was made in reliance upon an exemption from the registration
requirements of the Act provided by Section 4(2) of the Act.

         In May 2001, we issued 358,168 shares of our common stock to Dr. John
J. Fuery in accordance with the terms of a settlement agreement. Pursuant to the
terms of this agreement, debt in the amount of $716,336 (representing principal,
interest, expenses, rents and other amounts due to Dr. Fuery) converted into
shares of our common stock, at a conversion price of $2.00 per share. This
transaction was made in reliance upon an exemption from the registration
requirements of the Act provided by Section 4(2) of the Act.

         In June 2001, we issued 80,000 shares of our common stock to Akiva
Merchant Group, Inc. in accordance with the terms of an agreement between Akiva
and us. Pursuant to the terms of this agreement: (i) we agreed to reduce the
exercise price of a warrant to purchase 80,000 shares of our common stock from
$2.00 per share to $.01 per share; (ii) we agreed to purchase 30,000 of Akiva's
shares of our common stock at $2.00 per share; (iii) Akiva agreed not to
exercise its right to require us to purchase 170,000 of its shares of our common
stock, at a purchase price of $2.00 per share, until December 1, 2001 (with such
right ending on June 1, 2001); and (iv) debt in the amount of $800 (representing
interest due to Akiva) was relinquished as consideration for the exercise price
of the aforesaid warrant. This transaction was made in reliance upon an
exemption from the registration requirements of the Act provided by Section 4(2)
of the Act.

         In June 2001, we issued 60,000 shares of our common stock to CRC
Partners, LTD. in accordance with the terms of an agreement between CRC and us.
Pursuant to the terms of this agreement: (i) we agreed to reduce the exercise
price of a warrant to purchase 60,000 shares of our common stock from $2.00 per
share to $.01 per share; (ii) CRC agreed not to exercise its right to require us
to purchase 150,000 of its shares of our common stock, at a purchase price of
$2.00 per share, until December 1, 2001 (with such right ending on June 1,
2001); and (iii) debt in the amount of $600 (representing interest



                                       22
<PAGE>

due to CRC) was relinquished as consideration for the exercise price of the
aforesaid warrant. This transaction was made in reliance upon an exemption from
the registration requirements of the Act provided by Section 4(2) of the Act.

         In June 2001, we issued 50,000 shares of our common stock to Howard
Kaufman in accordance with the terms of an agreement between Mr. Kaufman and us.
Pursuant to the terms of this agreement: (i) we agreed to reduce the exercise
price of a warrant to purchase 50,000 shares of our common stock from $2.00 per
share to $.01 per share; (ii) Mr. Kaufman agreed not to exercise his right to
require us to purchase 125,000 of his shares of our common stock, at a purchase
price of $2.00 per share, until December 1, 2001 (with such right ending on June
1, 2001); and (iii) debt in the amount of $500 (representing interest due to Mr.
Kaufman) was relinquished as consideration for the exercise price of the
aforesaid warrant. This transaction was made in reliance upon an exemption from
the registration requirements of the Act provided by Section 4(2) of the Act.

         In September 2001, we issued 1,337,738 shares of our common stock to
DVI Financial Services Inc. in connection with an agreement between DVI and us.
Pursuant to the terms of the agreement, DVI exchanged 1,000 shares of our Series
B Preferred Stock, together with all accrued and unpaid dividends on the Series
B Preferred Stock, for an aggregate of 1,337,738 shares of our Common Stock
(147,262 shares of common stock were issued as payment for accrued and unpaid
dividends). This transaction was made in reliance upon an exemption from the
registration requirements of the Act provided by Section 3(a)(9) of the Act.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF PLAN OF OPERATION

RESULTS OF OPERATIONS

GENERAL

         The Company's operations are conducted through its wholly owned
subsidiary, U.S. Cancer Care. For this reason, the following discussion reflects
the operations of U.S. Cancer.

INITIATIVES TO IMPROVE PERFORMANCE

         The Company has incurred net losses of approximately $7.2 million
(including one-time non-cash charges of $4.4 million), $1.3 million, and
$900,000 for fiscal 2001, 2000, and 1999, respectively. As a result, the Company
has undertaken certain initiatives that it believes will increase revenues,
raise cash, improve cash flow and reduce debt obligations.

         The Company plans to increase revenues by offering state-of-the-art
treatment technologies (such as 3D Treatment Planning, Intensity Modulated
Radiation Therapy, PET and Brachytherapy) that provide advanced diagnostic and
treatment modalities. The Company anticipates that the ability to market and
offer such advanced technologies will increase patient volume. In addition, the
reimbursement rates for procedures performed by such technologies are higher
than the rates the Company currently receives. The Company intends to acquire
such technologies by obtaining financing from DVI Financial Services, Inc. or
other medical equipment lenders.

         In an effort to increase patient volume at certain treatment centers,
the Company has entered into new medical services agreements with its affiliated
physician groups. Under the new agreements, our affiliated physician groups will
receive financial incentives based upon the economic performance of the
Company's treatment centers. The Company anticipates that such incentives will
improve the marketing efforts of our affiliated physicians.

         In addition, the Company has undertaken other initiatives to improve
its financial position. In an effort to reduce labor costs, the Company
eliminated certain management positions and recently launched a recruiting
campaign to replace temporary therapists and physicists (who generally cost more
to retain) with permanent therapists and physicists.

         In furtherance of its effort to enhance its liquidity position, the
Company plans to sell certain properties. The Company is currently marketing the
Valley Regional Cancer Patient Care Center 1, Florida Cancer Center-Wells
Complex Clinic and Calallen Regional Cancer Center and intends to leaseback
these centers from the purchasers in the event these properties are sold. The
net proceeds from the sale of these properties will be used to retire long-term
and short-term debt



                                       23
<PAGE>

obligations. The Company recently sold land located at St. Augustine, Florida
for $415,000 and used all of the proceeds to reduce debt.

         The Company also anticipates that the amount of income it reports will
improve as a result of the recent adoption of Statement of Financial Accounting
Standards ("FAS") No. 142, which changes the subsequent accounting for goodwill
and other intangible assets in significant respects. Under FAS No. 142, the
company is not required to amortize goodwill unless it determines that goodwill
has been impaired.

         The Company believes that the initiatives it plans to take, and the
initiatives it has taken thus far, will eventually improve the financial
performance of the Company. However, the Company cannot give any assurance that
any of the proposed initiatives will improve the financial performance of the
Company or will not have a material adverse effect on the Company in the future.

SOURCES OF REVENUE GENERALLY

         Approximately 98% of the Company's revenues consists of service fees
that the Company receives from its affiliated physician groups. Pursuant to the
medical services agreements that the Company has entered into with each of its
affiliated physician groups, the Company receives fees for providing clinical
management, billing and collection, data warehousing and other administrative
services. These service fees are based upon a percentage of the earnings of the
center subject to the agreement. For this reason, the following discussion
reflects the financial performance of each of the Company's treatment centers as
well as the Company's mobile PET, CT scanners, and HDR unit.

YEAR ENDED DECEMBER 31, 2001 AS COMPARED TO YEAR ENDED DECEMBER 31, 2000

REVENUES

         Revenues for fiscal 2001 totaled $22.7 million, an increase of $2.7
million (or 13.5%) as compared to fiscal 2000. A majority of the Company's
revenues come from patient services. Net patient service revenues totaled
approximately $22.3 million for fiscal 2001, an increase of $2.5 million (or
12.6%) as compared to fiscal 2000. The increase is due to revenues of: (i) $1.4
million from our mobile PET scanner (which was placed in service in November
2000); and (ii) $1.4 million at Florida Cancer Center-Beaches (which was
acquired in January 2001).

         Revenues from all other sources totaled $408,045 and $239,115 for
fiscal 2001 and 2000, respectively. The increase is attributable to management
fees that the Company receives pursuant to a partnership agreement it entered
into with Lucas Medical Systems, Inc. in November 2000. Through this agreement,
the Company provides mobile PET services to two hospitals and all of its
treatment centers in Jacksonville, Florida. The Company has an 80% ownership
interest in the partnership.

OPERATING EXPENSES

         Operating expenses totaled $26.0 million for fiscal 2001, including a
$2.9 million impairment loss associated with the write-down of certain
long-lived assets, goodwill related to such assets. Excluding the impairment
loss, operating expenses increased by $4.3 million (or 22.6%) as compared to
fiscal 2000 and write-off of software development costs. The Company's operating
expenses consist primarily of: (i) salary and benefits; (ii) medical supplies
and services; (iii) general and administrative expenses; and (iv) depreciation
and amortization. Set forth on the chart below is the percentage of the
Company's revenues consumed by each of its operating expenses.

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------
EXPENSE                                  PERCENTAGE OF 2001 REVENUES  PERCENTAGE OF 2000 REVENUES
-------------------------------------------------------------------------------------------------
<S>                                                     <C>                          <C>
1.  Salary and Benefits                                 28%                          28%
-------------------------------------------------------------------------------------------------
2.  Medical Supplies and Services                       23%                          21%
-------------------------------------------------------------------------------------------------

                                       24
<PAGE>


<CAPTION>
-------------------------------------------------------------------------------------------------
<S>                                                     <C>                          <C>
3.  General and Administrative Expense                  36%                          28%
-------------------------------------------------------------------------------------------------
4.  Depreciation and Amortization                       14%                          11%
-------------------------------------------------------------------------------------------------
</TABLE>


         Expenses for salaries and benefits totaled $6.4 million for fiscal
2001, an increase of $734,000 (or 13.0%) as compared to fiscal 2000. The
increase is primarily due to an increase in expenses of: (i) $244,000
attributable to the treatment centers in Jacksonville, Florida (which employed
professional staff previously retained on a consulting agreement with the local
hospital); (ii) $164,000 attributable to our mobile PET scanner; (iii) $129,000
attributable to Florida Cancer Center-Beaches; and (iv) $224,000 attributable to
increases in salaries to reflect cost of living and merit increases.

         Expenses for medical supplies and services totaled $5.3 million for
fiscal 2001, an increase of $1.2 million (or 27.6%) as compared to fiscal 2000.
The increase is primarily due to an increase in expenses of $727,000
attributable to our mobile PET scanner and $426,000 attributable to Florida
Cancer Center-Beaches.

         General and administrative expenses totaled $8.3 million for fiscal
2001, an increase of $2.8 million (or 50.2%) as compared to fiscal 2000. The
increase is attributable to an increase in expenses of: (i) $326,000 for rent,
(ii) $283,000 for repairs and maintenance, (iii) $1.1 million for temporary
professional staff (due to a labor shortage of therapists and physicists), and
(iv) $736,000 for professional fees (principally due to the cost of public
filings and various capital related transactions).

         Expenses for depreciation and amortization totaled $3.1 million for
fiscal 2001, an increase of $927,000 (or 42.7%) as compared to fiscal 2000. The
increase is primarily due to depreciation expenses of $405,000 attributable to
newly acquired treatment centers and an adjustment of $287,000 to record
expenses to depreciate leasehold improvements over the life of the lease.
Previously, certain leasehold improvements were depreciated over a period
greater than the term of the lease.

         The Company recorded an expense of $57,000 and $1.4 million,
respectively, for fiscal 2001 and 2000, to recognize the non-cash compensation
expense relating to stock options granted to two directors at exercise prices
below fair market value.

         The Company incurred a significant charge against earnings in
connection with the impairment of certain long-lived assets (i.e., our center
and property in Corpus Christi, Texas), goodwill related to such assets and
software development costs. In accordance with FAS No. 121, the Company examined
the future net cash flows of the Corpus Christi assets and determined that they
were less than the carrying amount (i.e., the cost of an asset minus any
accumulated depreciation or amortization) of such assets. As required by FAS No.
121, the Company recognized an impairment loss of $2.7 million. The impairment
loss consisted of a write-off of $2.3 million in goodwill, net of accumulated
amortization, recorded upon acquisition of the center and a write-down of
$422,000 of the carrying value of the center's land and building. The impairment
loss also includes the write-off of unamortized software development costs of
$217,000. The Company ceased using the software in the third quarter of 2001.

INCOME/LOSS FROM OPERATIONS

         For fiscal 2001, the Company reported a loss from operations of $3.3
million, as compared to income from operations of $1.2 million for fiscal 2000.
The loss is attributable to: (i) the impairment loss; (ii) increased
compensation costs for permanent and temporary professional staff; (iii)
professional fees for public filings; and (iv) the write-off of certain assets,
principally capitalized loan costs.

OTHER EXPENSES

         Net other expenses totaled $3.6 million for fiscal 2001, an increase of
$1.1 million (or 45.1%) as compared to fiscal 2000. The largest portion of net
other expenses is interest expense. Interest expense totaled $2.5 million for
fiscal 2001, an increase of $225,000 (or 10.0%) as compared to fiscal 2000. The
increase is attributable to an increase in long term debt incurred to finance
investments in new technology.

                                       25
<PAGE>

         Other expenses totaled $1.1 million for fiscal 2001, as compared to
$1,400 in fiscal 2000. The Company reported a loss of $620,000 on disposal of
certain equipment, which had been deemed to have no useable value in the
business or any recoverable value from sale to a third party. The Company also
incurred a loss of $383,000 in connection with the settlement agreement it
entered into with W. Brian Fuery, and two entities controlled by him, Stunner
Corporation and U.S. Cancer Management Corporation. Pursuant to the settlement
agreement, the Company agreed to exchange its 49% interest in a partnership (in
which U.S. Cancer Management Corporation is the general partner) for 642,833
shares of common stock of the Company held by W. Brian Fuery. The loss
represents the difference between the fair market value of the Company's common
stock ($418,000) on the settlement date and the value of the Company's interest
in the partnership ($655,000) and other costs ($101,000) incurred in connection
with the settlement.

INCOME TAX BENEFIT

         The Company reported an income tax benefit of $291,000 and $417,000 for
fiscal 2001and 2000, respectively. The Company did this through an increase in
our deferred tax asset arising from our ability to use certain net operating
losses to offset deferred tax liabilities, as well as, future taxable income.

NET LOSS

         The Company reported a net loss of $7.2 million for fiscal 2001, as
compared to a net loss of $1.3 million for fiscal 2000. During fiscal 2001, the
Company recorded non-cash charges of approximately $4.4 million. The charges
included: (i) the impairment loss of $2.9 million; (ii) an adjustment for
non-recoverable management fees and reimbursable expenses under the Kaiser
Permanente contract of $531,000; (iii) the loss on disposal of certain obsolete
medical equipment of $447,000; (iv) and the write-down of certain assets of
$467,000, principally capitalized loan fees. Other factors that contributed to
the loss were the increased compensation costs for permanent and temporary
professional staff of $1.1 million and the costs of professional fees of
$736,000 (principally for public filings and various capital related
transactions).

NET LOSS ATTRIBUTABLE TO HOLDERS OF THE COMPANY'S COMMON STOCK

         The net loss attributable to the holders of the Company's common stock
amounted to $8.0 million or ($.89) per common share for fiscal 2001. The net
loss attributable to the Company's common stock reflects an additional $834,000
charge resulting from accrued cumulative preferred stock dividends of $534,000
and cash dividends paid of $300,000 for fiscal 2001.

YEAR ENDED DECEMBER 31, 2000 AS COMPARED TO YEAR ENDED DECEMBER 31, 1999

REVENUES

         Revenues for fiscal 2000 totaled $20.0 million, an increase of $3.2
million (or 19.3%) as compared to fiscal 1999. Net patient service revenues for
fiscal 2000 totaled $19.8 million, an increase of $3.0 million (or 18.2%) as
compared to fiscal 1999. The increase is due to revenues of: (i) $350,374 from
Sonora Cancer Center; (ii) $1.8 million from East Bay Regional Cancer Center;
and (iii) $1.0 million from St. Teresa Cancer Comprehensive Center (which was
acquired in June 2000).

         Revenues form all other sources totaled $239,000 for fiscal 2000, an
increase of $195,000 as compared to fiscal 1999. The increase is attributable to
management fees that the Company receives pursuant to the partnership agreement
it entered into with Lucas Medical Systems, Inc.

OPERATING EXPENSES

          Operating expenses for fiscal 2000 totaled $18.9 million, an increase
of $3.6 million (or 23.7%) as compared to fiscal 1999.

                                       26
<PAGE>

         Set forth on the chart below is the percentage of the Company's
revenues consumed by certain operating expenses.

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------
EXPENSE                                  PERCENTAGE OF 2000 REVENUES PERCENTAGE OF 1999 REVENUES
-------------------------------------------------------------------------------------------------
<S>                                                     <C>                           <C>
1.  Salary and Benefits                                 28%                           31%
-------------------------------------------------------------------------------------------------
2.  Medical Supplies and Services                       21%                           20%
-------------------------------------------------------------------------------------------------
3.  General and Administrative Expense                  28%                           28%
-------------------------------------------------------------------------------------------------
4.  Depreciation and Amortization                       11%                           12%
-------------------------------------------------------------------------------------------------
</TABLE>


         Expenses for salaries and benefits totaled $5.6 million for fiscal
2000, an increase of $421,000 (or 7.7%) as compared to fiscal 1999. The increase
is primarily due to an increase in expenses of $424,000 at our East Bay Regional
Cancer Center.

         Expenses for medical supplies and services totaled $4.2 million for
fiscal 2000, an increase of $756,000 (or 22.1%) as compared to fiscal 1999. The
increase is primarily due to the opening of centers in Hayward and Stockton,
which incurred expenses for medical supplies and services of $530,000 and
$227,000, respectively.

         General and administrative expenses totaled $5.5 million for fiscal
2000, an increase of $841,000 (or 18.0%) as compared to fiscal 1999. The
increase is attributable to costs associated with: (i) relocating our accounting
office, (ii) closing an executive office, and (iii) the Company's reorganization
with U.S. Cancer Care.

         Expenses for depreciation and amortization totaled $2.2 million for
fiscal 2000, an increase of $221,000 (or 11.3%) as compared to fiscal 1999. The
increase is attributable to the acquisition of new equipment at FL Cancer
Center-Orange Park, FL Cancer Center-Palatka, St. Teresa Comprehensive Cancer
Center and East Bay Regional Cancer Center.

         The Company recorded an expense of $1.4 million for fiscal 2000 to
recognize the non-cash compensation expense relating to stock options granted to
two directors at exercise prices below fair market value.

INCOME FROM OPERATIONS

         Income from operations totaled $1.2 million for fiscal 2000, a decrease
of $380,000 (or 24.8%) as compared to fiscal 1999. The decrease is attributable
to expenses for non-cash compensation, reduced by an increase in revenues and a
reduction in general and administrative costs.

OTHER EXPENSES

         Net other expenses totaled $2.5 million for fiscal 2000, an increase of
$236,000 (or 10.5%) as compared to fiscal 1999. The largest portion of our net
other expenses is interest expense. Our interest expense for the fiscal 2000
totaled $2.2 million. As compared to 1999, this represents an increase of
$197,000 (or 9.6%), which is attributable to an increase in our average debt
outstanding.

INCOME TAX BENEFIT

         For fiscal 2000, the Company reported an income tax benefit of
$417,000. The Company did this through an increase in our deferred tax asset
arising from our ability to use certain net operating losses to offset deferred
tax liabilities, as well as, future taxable income.

                                       27
<PAGE>

NET LOSS

         The Company reported a net loss of $1.3 million for fiscal 2000, as
compared to a net loss $917,000 for fiscal 1999. The increase is attributable to
the expense for non-cash compensation expenses, reduced by an increase in our
revenues and a reduction in our general and administrative costs.

NET LOSS ATTRIBUTABLE TO HOLDERS OF COMMON STOCK

         Net loss attributable to holders of the Company's common stock amounted
to $2.4 million or $.30 per common share for fiscal 2000. The net loss
attributable to the Company's common stock reflects an additional $1.1 million
charge resulting from accrued cumulative preferred stock dividends of $575,000
and imputed non-cash preferred stock dividends of $558,000 arising from the
amortization of discounts on preferred stock.

LIQUIDITY AND CAPITAL RESOURCES

         The Company incurred net losses of approximately $7.2 million
(including one-time non-cash charges of $4.4 million), $1.3 million and $900,000
for fiscal 2001, 2000 and 1999, respectively. The Company had working capital
deficits of approximately $5.8 million and $6.0 million at December 31, 2001 and
2000, respectively. As a result, the Company has undertaken the following
initiatives.

         The Company intends to raise additional funds by issuing equity
securities (which may have rights superior to the rights of our common stock).
In addition, the Company intends to sell certain properties. The Company is
currently marketing the Valley Regional Cancer Patient Care Center 1, Florida
Cancer Center-Wells Complex Clinic and Calallen Regional Cancer Center and
intends to leaseback these centers from the purchasers in the event these
properties are sold. The net proceeds from the sale of these properties will be
used to retire long-term and short-term debt obligations. The Company recently
sold land located at St. Augustine, Florida for $415,000 and used all of the
proceeds to reduce debt.

         The Company anticipates that enhanced collection procedures in certain
treatment centers will improve cash flow. In addition, the Company believes that
an increase in the market value of the Company's shares of common stock could
eliminate the Company's obligation to redeem the shares of common stock held by
certain shareholders of the Company. See "Cash and Cash Equivalents."

CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS

         As of December 31, 2001, the Company's future contractual obligations
are as follows:

<TABLE>
<CAPTION>
                                                         -------------------------------------------------------------
                                                                          Payments Due by Period
----------------------------------------------------------------------------------------------------------------------
Contractual Obligations                        Total      Less than 1 yr.   2-3 years     4-5 years     After 5 years
----------------------------------------------------------------------------------------------------------------------

<S>                          <C>             <C>             <C>           <C>            <C>              <C>
Long Term Debt-Notes Payable (1)             $16,686,477     $3,785,184    $ 7,452,872    $4,668,086       $780,335
Operating Leases (2)                           4,766,379      1,255,081      2,094,513     1,244,204        172,581
Securities with Put Options (3)                1,311,336      1,311,336
Other Long-Term Obligations(4)                 1,131,408        262,500        565,031       303,877
                                            --------------------------------------------------------------------------
Total Contractual Obligations                $23,895,600     $6,614,101    $10,112,416    $6,216,167       $952,916
                                            ==========================================================================
</TABLE>



     (1)  At December 31, 2001, the Company had twenty-eight long-term notes
          payable totaling approximately $13.0 million to DVI Financial
          Services, Inc. and approximately $3.7 million in notes payable with
          other equipment financing companies. Substantially all of the
          receivables, equipment and certain tangible assets of the Company
          collateralize the notes payable. Interest is charged at rates that
          range between 6.0% to 15.0%, and the notes mature through 2009.

     (2)  The Company leases certain facilities under various operating lease
          that expire through 2007. Certain real estate leases have options to
          renew for periods from 3-15 years.

                                       28
<PAGE>

     (3)  Certain of our stockholders have the right to require us to purchase
          an aggregate of 655,668 shares of common shares at $2.00 per share.

     (4)  The Company has entered into an employment agreement with Jeffrey A.
          Goffman, Chief Executive Officer, which expires May 22, 2005. As of
          December 31, 2001, the Company is required to provide minimum base
          salaries and bonuses over the agreement term, including minimum annual
          increases. The employment agreement may be terminated by the Company
          without cause subject to a severance payment. See "Executive
          Compensation."

     As of December 31, 2001, the Company's future commercial commitments are as
follows:
<TABLE>
<CAPTION>
                                                              ----------------------------------------------------------
                                                                  Amount of Commitment Expiration per Period
------------------------------------------------------------------------------------------------------------------------
Commercial Commitments                           Total        Less than 1 yr.  2-3 years    4-5 years     After 5 years
------------------------------------------------------------------------------------------------------------------------
<S>                                           <C>                <C>               <C>                          <C>
Lines of Credit (1)                            $4,784,177        $3,759,177                   $1,025,000
Standby Letter of Credit (2)                      400,000                        $400,000
                                            ----------------------------------------------------------------------------
Total Commercial Commitments                   $5,184,177        $ 3,759177      $400,000     $1,025,000
                                            ============================================================================
</TABLE>

     (1)  The Company has entered into three separate loan and security
          agreements with DVI Financial Services, Inc., the beneficial owner of
          more than 5% of our voting securities, pursuant to which DVI provides
          the Company with revolving lines of credit. The maximum amount
          available under this credit facility is $4.4 million, with advances
          limited to eighty-five percent (85%) of eligible account receivables.
          Borrowings under the line of credit bear interest at a rate that
          ranges between 2.0% to 2.25% over the prime lending rate. On December
          27, 2001, the Company and DVI agreed to amendments to the loan and
          security agreements, which extend the maturity dates for the lines of
          credit to June 2004. Our obligations under the credit facility are
          collateralized through a grant of a first security interest in the
          accounts receivable of several of our treatment centers. Our agreement
          with DVI Financial Services, Inc. contains customary affirmative and
          negative covenants. Borrowings under this credit facility are used to
          fund working capital needs and to fund the development of new centers.
          At December 31, 2001, we had approximately $3.8 million of borrowings
          under this credit facility.

          During fiscal 2001, we were in compliance with all covenant provisions
          of the credit agreements with DVI Financial Services.

          We also entered into a secured loan agreement with Merrill Lynch Bank
          USA, which expires on March 20, 2006. The maximum amount available
          under this credit facility is $2.8 million. Borrowings under this line
          of credit bear interest at a rate that is 1.39% over the LIBOR Rate.
          Our obligations under this credit facility are collateralized by
          certain cash equivalent securities. Our agreement with Merrill Lynch
          does not contain any financial or other restrictive covenants.
          Borrowings under this credit facility will also be used to fund
          working capital needs and to fund the development of new centers. At
          December 31, 2001, we had approximately $1.0 million of borrowings
          under this credit facility.

     (2)  Marcap Corporation is the beneficiary of a standby letter of credit in
          the amount of $400,000 as collateral for a note payable.

CASH AND CASH EQUIVALENTS

         For fiscal 2001 and 2000 we had: (i) cash and cash equivalents of
approximately $12,000 and $51,000, respectively; and (ii) working capital
deficits of $5.8 million and $6.0 million, respectively.

         Net cash generated by our operations totaled $1.2 million for fiscal
2001. Our net cash consists of: (i) net loss of $7.2 million, and (ii) non-cash
and operating asset and liability adjustments of $8.4 million. Our investing
activities utilized $5.0 million of our cash, of which $2.7 million was used for
the purchases of property and equipment, $889,000 for investment in our
partnership with U. S. Cancer Management Corporation and $1.0 million as
collateral for our line of



                                       29
<PAGE>

credit. Net cash generated from our financing activities included: (i) $4.0
million from the issuance of our Series E Preferred Stock; and (ii) $2.5 million
from proceeds from long-term debt. We utilized approximately $4.1 million of the
cash generated from our financing activities for the payment of long-term debt
and private placement costs. Net proceeds from short-term borrowing amounted to
$1.9 million.

         For fiscal 2002, the Company anticipates that it will need
approximately $6.4 million to acquire new technologies for our cancer treatment
centers. Historically, the Company has financed these discretionary capital
expenditures through the sale of equity securities and loans from third party
lenders. For fiscal 2002, we plan to secure financing from third-party lenders
to fund these discretionary capital expenditures. The Company does not intend to
use its cash to fund these expenditures. The Company has commitments from a
third party lender to finance these capital expenditures, however, there can be
no assurance that the Company will be able to do so on favorable terms, if at
all. If such financing is not available, the Company will defer making these
expenditures, which may limit its ability to increase revenues and earnings.

         The continued growth of the Company's business, including the
acquisition or development of new facilities, will require substantial cash
resources and will have an impact on the Company's liquidity. The Company
believes that cash to be provided by its operating activities will enable it to
meet the anticipated cash requirements of its operations for the next twelve
months. However, certain shareholders of the Company have the right to require
us to purchase an aggregate of 655,668 shares of common stock of the Company at
$2.00 per share. In addition, Dr. John J. Fuery, a former director and principal
shareholder of the Company, has the right to require the Company to purchase a
total of 358,168 shares of the Company's common stock held by him if such shares
of common stock are not purchased by Continuum Capital Partners by November 10,
2002. If the Company is required to purchase a substantial amount of the shares,
the Company will have to secure additional financing to do so. There is no
assurance that such additional financing will be available on satisfactory
terms, if at all.

OTHER FACTORS THAT MAY AFFECT FUTURE OPERATING RESULTS

OUR OPERATING RESULTS ARE SUBJECT TO SEASONAL FLUCUATIONS

         Due to seasonal variations in population, a significant portion of the
Company's treatment centers, particularly those in the state of Florida and
Texas, are subject to seasonal fluctuations. Population levels increase during
the winter months in these locations and the demand for radiation therapy during
these months also increases. As a result, we have historically experienced, and
expect to continue to experience, quarterly fluctuations in net service revenues
and net income, with higher amounts in the first and fourth quarters. We have a
high level of fixed operating costs, which cannot be reduced at times of lower
demand. Fluctuations in seasonal demand for radiation therapy may, therefore,
affect our quarterly results. In addition, results for a given period may be
affected by expenses associated with the opening or acquisition of additional
centers in that or prior periods. Results of operations for any quarter are not
necessarily indicative of results of operations for any future period or for a
full year.

WE ARE SUBJECT TO HEALTH CARE REGULATIONS

         Recent statutory changes affecting the Medicare and Medicaid programs,
including provisions enacted as part of the Balanced Budget Act of 1997 that are
intended to reduce overall Medicare and Medicaid expenditures and that permit
states greater flexibility in the administration of their Medicaid programs, may
affect our anticipated performance.

REDUCTIONS IN THIRD PARTY REIMBURSEMENT MAY ADVERSELY AFFECT OUR NET REVENUES
AND NET INCOME

         Health care providers typically bill various third party payors, such
as governmental programs (e.g., Medicare and Medicaid), private insurance plans
and managed care plans, for the health care services provided to their patients.
These third party payors are increasingly negotiating the prices charged for
medical services, pharmaceuticals and other supplies, with the goal of lowering
reimbursement and utilization rates. Third party payors can also deny
reimbursement for medical services, pharmaceuticals and other supplies if they
determine that a treatment was not performed in accordance with treatment
protocols established by such payors or for other reasons. Changes in
reimbursement policies of third-party payors, particularly to the extent that
any such changes affect reimbursement for radiation therapy services, will
affect our net revenues and net income.

                                       30
<PAGE>

         In addition, rates paid by non-governmental insurers, including those
which provide Medicare supplemental insurance, are based on established
physician radiation therapy and hospital charges, and are generally higher than
Medicare payment rates. Any decrease in the number of our patients covered by
private insurance will affect our net revenues and net income.

ITEM 7.  FINANCIAL STATEMENTS

         The following consolidated financial statements of the Company and its
subsidiaries are filed on the pages listed below, as part of Part II, Item 7.

Report of Independent Auditors                                       F-1

Consolidated Balance Sheet as of December 31, 2001 and 2000          F-2 - F-3

Consolidated Statements of Operations for the years ended
December 31, 2001, 2000 and 1999                                     F-4

Consolidated Statements of Stockholders' Equity for the years ended
December 31, 2001, 2000 and 1999                                     F-5 - F-6

Consolidated Statements of Cash Flows for the years ended
December 31, 2001, 2000 and 1999                                     F-7 - F-9

Notes to Consolidated Financial Statements                           F-10 - F-38


                               . . . . . . . . . .

ITEM 8.  CHANGE IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

         On November 16, 2001, the Company dismissed Moore Stephens, P.C.
("Moore Stephens") as its independent auditors and engaged Moss Adams LLP ("Moss
Adams") to serve as its independent auditors for the fiscal year ended December
31, 2001. The decision to dismiss Moore Stephens was made by the Audit Committee
of the Company's Board of Directors.

         During the period in which the Company engaged Moore Stephens (i.e.,
January 16, 2001 through November 16, 2001), there were no disagreements between
the Company and Moore Stephens on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure,
which, if not resolved to the satisfaction of Moore Stephens, would have caused
Moore Stephens to make reference thereto in their report on the financial
statements of the Company. In addition, none of the audit reports provided by
Moore Stephens contained an adverse opinion, or disclaimer of opinion, or was
modified as to uncertainty, audit scope or accounting principles.

         A letter from Moore Stephens confirming the statements in the foregoing
paragraph was filed on December 13, 2001 with the Securities and Exchange
Commission as part of the Company's current report on Form 8-K disclosing the
change of accountants.

         Prior to the engagement of Moss Adams as the Company's independent
auditors on November 16, 2001, the Company had not consulted with Moss Adams
regarding (i) the application of accounting principles to a specified
transaction (either completed or proposed) or the type of audit opinion that
might be rendered on the Company's financial statements; or (ii) any matter that
was either the subject of a disagreement or event described in clause (i) of
this paragraph.

                                       31
<PAGE>

                                    PART III

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

The following table sets forth certain information regarding the Company's
executive officers and directors:

<TABLE>
<CAPTION>
NAME                       AGE       POSITION
----                       ---       ---------
<S>                        <C>       <C>
Shyam B. Paryani, MD       46        Chairman of the Board of Directors
Jeffrey A. Goffman         43        President, Chief Executive Officer, Secretary and Director
Richard A. Baker           51        Senior Vice President and Chief Financial Officer
Gerald D. Boyajian         54        Vice President and Chief Operating Officer
Charles J. Jacobson        62        Director of Managed Care Contracting and Director
Stanley S. Trotman, Jr.    55        Director
Gordon C. Rausser, Ph.D.   56        Director
John H. Zeeman             73        Director
John W. Wells, Jr., M.D.   47        Director
</TABLE>

SHYAM B. PARYANI, MD. Dr. Paryani has served as Chairman of the Board of
Directors of the Company since January 2001 and a member of the Board of
Directors since October 1998. Dr. Paryani also serves as the Chairman of the
Medical Advisory Board of the Company. Dr. Paryani is Board-Certified in
radiation oncology and currently is the Director of Radiation Oncology at
Memorial Hospital in Jacksonville, Williams Cancer Center, and Co-Director of
Radiation Oncology at Baptist Medical Center, FCC-Wells, FCC-Northside, FCC-St.
Johns, FCC-Orange Park, and FCC-Palatka. Dr. Paryani received his undergraduate
and medical degrees from the University of Florida, Gainesville. He received his
radiation oncology training at Stanford University. Dr. Paryani also serves on
the Board of Directors of the Baptist Health Foundation, the American Cancer
Society, the Memorial Hospital Medical Board and the Northeast Hospice
Acquanimatas Board.

JEFFREY A. GOFFMAN. Mr. Goffman serves as the Company's President, Chief
Executive Officer and Secretary. He has been a member of the Board of Directors
of the Company since May 1998. Mr. Goffman was the founder of U.S. Diagnostic,
Inc. ("USD"), a leading provider and consolidator of outpatient diagnostic
imaging facilities. From its inception in June 1993 until 1997, Mr. Goffman
served as USD's Chairman and Chief Executive Officer. In 1988 Mr. Goffman
founded Goffman and Associates, Certified Public Accountants, PC, an accounting
firm in New York, and remained a partner at this firm until 1994 (from 1988 to
1992 Mr. Goffman was the managing partner of Goffman and Associates). Mr.
Goffman is an inactive Certified Public Accountant licensed in New York and
Florida and holds a degree in Accounting from the University of Hartford. Mr.
Goffman is a member of the American Institute of Certified Public Accountants.
Mr. Goffman also serves on the Board of Directors of Affiliated PET Systems,
LLC, a private company that provides Positron Emission Tomography services in
the Washington D.C. area.

         According to the SEC, during Mr. Goffman's tenure as Chief Executive
Officer of USD, the company, relying upon advice of counsel, allegedly failed to
disclose the background of a consultant to the company. In December 2000, USD
and Mr. Goffman, without admitting or denying the allegations, settled this
matter with the SEC by agreeing to a consent order pursuant to Section 8A of the
Securities Act and 21C of the Exchange Act in which each agreed to cease and
desist from committing or causing any violation and any future violation of
Section 17(a)(2) and (a)(3) of the Securities Act and from causing any violation
and any future violation of Sections 13(a) and 14(a) of the Exchange Act.

RICHARD A. BAKER. Mr. Baker is the Senior Vice President and Chief Financial
Officer of the Company. Mr. Baker has over 20 years of experience with public
and private companies, SEC reporting and investor relations, merger and
acquisition transactions, strategic planning and financial management. Prior to
joining us in May 2001, Mr. Baker served as the Chief Financial Officer of
Strategy Associates, Inc. (from May 2000 to May 2001) and the Chief Operating
Officer of International EZ-UP, Inc. (from March 1999 to January 2000). From
July 1995 to August 1998, Mr. Baker held positions as the Executive Vice
President-Administration and Executive Vice President-Operations of Tri-Valley
Growers, Inc., where he led strategic initiatives that improved operating and
financial performance. Tri-Valley Growers, Inc. was forced into bankruptcy by
its creditors in July 2000. Mr. Baker holds a Bachelor of Science degree in
Accounting and



                                       32
<PAGE>

Business Management from Tri-State University. He earned his CPA license in
Indiana in 1978 and is a member of the National Investor Relations Institute.

GERALD D. BOYAJIAN. Mr. Boyajian is the Vice President and Chief Operating
Officer of the Company. Mr. Boyajian has over 20 years of experience in
financial and executive management including over 12 years in executive
healthcare management. Prior to joining OnCure in February of 2000, Mr. Boyajian
served as the Executive Director for HRC, Inc. from July 1998 to January 2000.
From September 1990 to January 1998, Mr. Boyajian served as the Executive
Director for Tuolumne Family Health Services, Inc., a community based health
care organization. Mr. Boyajian has also held the position of Director of
Finance and Operations for a public benefit corporation. Prior to his public
service, Mr. Boyajian was in private practice as a CPA. Mr. Boyajian holds a
Bachelor of Science degree in Business Administration-Accounting from California
State University at Northridge. Mr. Boyajian is an inactive Certified Public
Accountant licensed in California.

CHARLES J. JACOBSON. Mr. Jacobson has been a member of the Board of Directors of
the Company since May 1998. Mr. Jacobson also serves as the Company's Director
of Managed Care Contracting. Since 1983, Mr. Jacobson has been the Chairman and
Chief Executive Officer of Jacobson Consulting, Inc., a diversified healthcare
consulting firm and third party administrator. From 1980 to 1983, Mr. Jacobson
served on the development team of CIGNA Healthcare in the state of Florida. From
1972 to 1980, Mr. Jacobson was the Director of New Business Development for
Hospital Affiliates, Inc. Mr. Jacobson has served on the Board of Directors of
St. John's River Rural Health Network and Provider Network Management
Corporation, both of which are management service organizations serving
physician groups in the southeastern United States, and U.S. Diagnostic Equity
Partners, a joint venture between Phycor, Inc. and USD. Mr. Jacobson currently
serves as a director of Diversified Therapy Corporation, a national network of
clinical wound care centers, Pricare Management Services Corporation, a
physician management company, and Chiro Alliance Corp., a Florida based
chiropractic IPA. Mr. Jacobson holds a Bachelor of Science degree from Christian
Brothers University and an MBA from De Paul University, Graduate School of
Business.

STANLEY S. TROTMAN, JR. Mr. Trotman has been a member of the Board of Directors
of the Company since May 1998. Mr. Trotman also serves on the Board of Directors
of American Shared Hospital Services, Inc. (a public company that provides Gamma
Knife stereotactic radiosurgery). Mr. Trotman retired in December 2000 as the
Managing Director of the healthcare group at Paine Webber Inc. (an investment
banking firm). Mr. Trotman had been with PainWebber since 1995, following the
consolidation of Kidder Peabody & Company (also an investment banking firm) with
PainWebber. From April 1990 to March 1995, Mr. Trotman was co-director of Kidder
Peabody & Company's healthcare group. Prior to his tenure with Kidder Peabody &
Company, Mr. Trotman had been with Drexel Burnham Lambert, Inc. for
approximately 22 years. During his tenure Drexel Burnham Lambert, Mr. Trotman
served as the head of their healthcare group. Mr. Trotman received his
undergraduate degree from Yale University in 1965 and in 1967 received his MBA
from Columbia Business School.

GORDON C. RAUSSER, PH.D. Dr. Rausser has been a member of the Board of Directors
of the Company since May 1998. For more than nine years, Dr. Rausser has been a
principal and director at the Law and Economics Consulting Group, Inc., an
economics consulting group that provides consulting and litigation support
services primarily to Fortune 500 companies. He is Chairman of the Board of
Directors of TriColor Line, Inc., a commercial real estate and export/import
company with offices in San Francisco, London and Prague. Since 1993, Dr.
Rausser has served as Dean of the College of Natural Resources at the University
of California, Berkeley and since 1986 as a Robert Gordon Sproul Distinguished
Professor. He has won fifteen national awards for his innovative economic
research and strategy analysis. He has also served as Chairman of the Department
of Agriculture Resource Economics at the University of California at Berkeley
(from 1979 to 1985 and, again, from 1992 to 1994). Dr. Rausser, while on leave
from the University of California, Berkeley, served as the Senior Economist on
the Council of Economic Advisors (1986-1987) and as Chief Economist of the
Agency for International Development. Dr. Rausser also serves on the Board of
Directors of LECG, Inc., an economic consulting firm. Dr. Rausser has a Bachelor
of Science degree from California State University, Fresno, and a Master of
Science degree and Ph.D. from the University of California, Davis.

JOHN H. ZEEMAN. Mr. Zeeman has been a member of the Board of Directors of the
Company since January 2001. Since 1973, Mr. Zeeman has served as Chairman of the
Board of Directors of Mariner Financial Corporation, a financial consulting firm
which provides strategic planning and financing. Mr. Zeeman currently serves as
a member of the Board of Directors of New Horizon Diagnostics, Inc., a company
engaged in the manufacturing and sale of proprietary biomedical products and
Priva Technologies, Inc., a developer of high technology security systems. From
1989 to 1997, Mr. Zeeman



                                       33
<PAGE>

served on the Board of Directors and as Chairman of the Executive Committee of
Teklicon, Inc., a high technology firm specializing in litigation support. From
1995 to 1997 he was Chief Executive Officer of Condyne Electronics, Inc., a
company specializing in electronic energy conservation equipment. In addition,
from 1991 to 1997, Mr. Zeeman served as a member of the Board of Directors of
HDA International SA, a leading European manufacturer of computer parts for IBM,
Sony and others. From 1968 to 1973, Mr. Zeeman served as President and Chief
Executive Officer of Appolo Industries, a diversified holding company. He
resigned from Appolo after the company was sold. Mr. Zeeman was a founding
shareholder of MCI Communications, Inc. and served on its Board of Directors
until its initial public offering. Mr. Zeeman served as a financial analyst at
L.F. Rothchild, Inc. and as a corporate finance partner at Andresen and Company,
Inc. Mr. Zeeman served as an officer in the Royal Dutch Navy and he was a
graduate of its academy.

JOHN W. WELLS, JR., MD. Dr. Wells has been a member of the Board of Directors of
the Company since January 2001. Dr. Wells also serves a member of the Medical
Advisory Board of the Company. Dr. Wells is Board-Certified in radiation
oncology and currently is the Chief of Radiation Oncology at Orange Park Medical
Center in Jacksonville, Florida. Dr. Wells was a naval aviator in the United
States Marine Corps. Dr. Wells has a Bachelor of Science Degree and a Master of
Science degree in Mathematics from Auburn University. Dr. Wells received his
medical degree from the Medical College of Georgia and took his residency at
Stanford University. Dr. Wells is a member of the Duval County Medical Society
of Clinical Oncology, and the American Endocrine-Therapy Society.

SECTION 16 (A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

         Section 16(a) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), requires the Company's directors and executive officers and
persons who beneficially own more than 10% of a registered class of the
Company's equity securities ("Reporting Persons") to file reports of ownership
and changes in ownership with the Securities and Exchange Commission (the "SEC")
on a timely basis. Reporting Persons are required to furnish the Company with
copies of all such forms that they file. Except as provided below, the Company
believes, based solely on its review of such forms, that all filing requirements
applicable to Reporting Persons during and with respect to fiscal year 2001 were
complied with on a timely basis.

                                                                 NUMBER OF
                                                 NUMBER OF     TRANSACTION NOT
NAME                                             LATE REPORTS  TIMELY REPORTED
----                                             ------------  ---------------
Alpine Venture Capital Partners***                      1            1
Richard A. Baker                                        1            1
DVI Financial Services, Inc.***                         2            2
John J. Fuery***                                        2            2
W. Brian Fuery***                                       3            3
Jeffrey A. Goffman                                      1            1
Charles J. Jacobson                                     1            1
Douglas A. McBride                                      1            1

Mercurius Beleggingsmaatchappij BV***                   1            1
Richard W. Padelford                                    1            1
Participatie Maatschappij Avanti Limburg BV***          1            1
Shyam B. Paryani                                        1            1
Gordon C. Rausser                                       1            1
Randy C. Sklar                                          1            1
Stanley S. Trotman, Jr.                                 1            1
John W. Wells, Jr.                                      1            1
John H. Zeeman                                          1            1


***Based solely on review of the forms submitted to the Company, none of Alpine
Venture Capital Partners, DVI Financial Services, Inc., John J. Fuery, W. Brian
Fuery, Mercurius Beleggingsmaatchappij BV or Participatie Maatschappij Avanti

                                       34
<PAGE>

Limburg BV has filed the report(s), pertaining to ownership of the Company's
securities, required by Section 16(a) of the Exchange Act.

ITEM 10. EXECUTIVE COMPENSATION

     The following table summarizes compensation earned by, or paid to (a) each
person serving as the Chief Executive Officer of the Company (i.e., Mitchell
Hymowitz and Jeffrey A. Goffman), (b) each person serving as an executive
officer of the Company, other than the Chief Executive Officer, on December 31,
2001 (i.e., Gerald D. Boyajian and Richard A. Baker) and (c) each person that
served as an executive officer of the Company during fiscal year 2001 and who
earned more than $100,000 in salary and bonus during the year (i.e., Richard W.
Padelford and Douglas A. McBride). Each of Mitchell Hymowitz, Jeffrey A.
Goffman, Gerald D. Boyajian, Richard A. Baker, Richard W. Padelford and Douglas
A. McBride shall be referred to collectively as the "Named Executive Officers."


<TABLE>
<CAPTION>

                                                                           COMPENSATION
                                      ---------------------------------------------------------------------------
                                                                                      LONG TERM
                                                        ANNUAL                      COMPENSATION
   NAMED EXECUTIVE         FISCAL     ----------------------------------------         AWARDS            ALL
       OFFICER              YEAR       SALARY(1)        BONUS         OTHER(2)       OPTIONS(3)         OTHER
-----------------------------------------------------------------------------------------------------------------
<S>                         <C>        <C>           <C>              <C>         <C>                  <C>
Jeffrey A. Goffman          2001       $262,000      $100,000(4)
   President, Chief         2000       $250,000                      $75,000(5)       200,000          $12,000(6)
   Executive Officer        1999       $200,000                                                        $12,000
   & Director                                                                                          $12,000

Gerald D. Boyajian(7)       2001        $95,000                                        45,000           $2,000(8)
   Vice President           2000        $57,000
   & Chief Operating
   Officer

Richard A. Baker(9)         2001       $104,000                                       125,000
   Sr. Vice President
   & Chief Financial
   Officer

Richard W. Padelford(10)    2001       $179,000                                       113,333         $10,500(11)
   Former Chief             2000       $163,000                                                       $12,000
   Operating Officer        1999       $125,000                                                       $12,000

Douglas A. McBride(12)      2001       $150,000                                        49,333          $4,000(13)
   Former Chief             2000       $195,000                                                       $12,000
   Information Oficer       1999       $175,000                                                       $12,000

Mitchell Hymowitz(14)       2001
                            2000        $98,750(15)
                            1999        $61,875
-----------------------------------------------------------------------------------------------------------------
</TABLE>

     (1)  The amount provided in the salary column includes amounts deferred by
          the named person pursuant to Section 401(k) of the Internal Revenue
          Code.

                                       35
<PAGE>

     (2)  Unless noted, the value of prerequisites and other personal benefits,
          securities and other property paid to or accrued for the Named
          Executive Officers did not exceed $50,000 for each such officer, or
          10% of such officer's total reported salary and bonus, and thus are
          not included in the table.

     (3)  Represents the number of shares of common stock underlying options
          granted pursuant to the Company's stock option plans.

     (4)  Mr. Goffman received a $100,000 bonus in January 2001 in conjunction
          with the Company's reorganization with U.S. Cancer Care.

     (5)  Mr. Goffman received $75,000 for relocation expenses in conjunction
          with the Board's request for him to move to California.

     (6)  The amount provided in the "All Other Compensation" column for Mr.
          Goffman consists of: $6,000 received in 1999, 2000, and 2001 for auto
          expenses; and $6,000 received in 1999, 2000, and 2001 for premiums on
          life insurance for his benefit.

     (7)  Gerald D. Boyajian was promoted to his position of Vice President and
          Chief Operating Officer as of September 21, 2001.

     (8)  The amount provided in the "All Other Compensation" column for Mr.
          Boyajian consists of: $1,000 received in 2001 for auto expenses; and
          1,000 received in 2001 for premiums on life insurance for his benefit.

     (9)  Richard A. Baker joined the Company as Senior Vice President and Chief
          Financial Officer on May 1, 2001.

     (10) Richard W. Padelford resigned from his position as our Chief Operating
          Officer on August 30, 2001.

     (11) The amount provided in the "All Other Compensation" column for Mr.
          Padelford consists of: $6,000 received in 1999 and 2000 and $4,500
          received in 2001 for auto expenses; and $6,000 received in 1999, 2000,
          and 2001 for premiums on life insurance for his benefit.

     (12) Douglas A. McBride ceased to be our Vice President and Chief
          Information Officer as of August 27, 2001.

     (13) The amount provided in the "All Other Compensation" column for Mr.
          McBride consists of: $6,000 received in 1999 and 2000 and $4,000
          received in 2001 for auto expenses; and $6,000 received in 1999 and
          2000 for premiums on life insurance for his benefit.

     (14) Prior to our reorganization with U.S. Cancer Care, Mitchell Hymowitz
          was our President, sole Director and only salaried employee. Following
          the completion of the reorganization, Mitchell Hymowitz resigned from
          his positions as President and Director, effecting an immediate
          transition to the current management team. Current management consists
          of those individuals who served as officers and directors of U.S.
          Cancer Care prior to the reorganization.

     (15) Mitchell Hymowitz was issued 39,500 shares (as adjusted for the
          Reverse Stock Split) of our common stock as compensation for services
          performed. The fair market value of these shares at the time they were
          issued to Mr. Hymowitz was $98,750.

OPTION GRANTS IN LAST FISCAL YEAR

         The following table sets forth each grant of stock options during the
fiscal year ended December 31, 2001 to each of the Named Executive Officers who
received such grants. No stock appreciation rights were granted during such
fiscal year.

                                       36
<PAGE>

<TABLE>
<CAPTION>
                          NUMBER OF      PERCENT OF
                          SECURITIES     TOTAL OPTIONS
                          UNDERLYING     GRANTED TO
                          OPTIONS        EMPLOYEES IN      EXERCISE PRICE     EXPIRATION
                          GRANTED        FISCAL 2000       ($/SHARE)          DATE
                          ----------     --------------    --------------     -----------
<S>                          <C>          <C>              <C>               <C>
Jeffrey A. Goffman           0

Gerald D. Boyajian         10,000             5.41%            $2.00         July 12, 2005
                           25,000            13.51%            $1.30         September 21, 2006

Richard A. Baker           50,000            27.02%            $2.00         May 1, 2006
                           50,000            27.02%            $2.00         May 1, 2006
                           25,000            13.51%            $1.30         September 7, 2006

Richard W. Padelford         0

Douglas A. McBride           0

Mitchell Hymowitz            0
</TABLE>


OPTION EXERCISES AND FISCAL YEAR-END VALUES

         The following table provides information about exercised stock options
held by the Named Executive Officers. During fiscal year 2001, none of the Named
Executive Officers exercised stock options.

<TABLE>
<CAPTION>
                                                        NUMBER OF SECURITIES        VALUE OF
                                                        UNDERLYING UNEXERCISED      UNEXERCISED IN-THE-MONEY
                         SHARES                         OPTIONS AT YEAR END         OPTIONS AT YEAR END($)
                         ACQUIRED ON     VALUE          EXERCISABLE/                EXERCISABLE/
                         EXERCISE        REALIZED       UNEXERCISABLE               UNEXERCISABLE
                         -----------     ---------      ----------------------      -------------------------
<S>                          <C>             <C>        <C>                          <C>
Jeffrey A. Goffman           0               0          122,933/77,067

Gerald D. Boyajian           0               0          3,540/41,460

Richard A. Baker             0               0          0/125,000

Richard W. Padelford         0               0          113,333/0

Douglas A. McBride           0               0          49,333/0

Mitchell Hymowitz            0               0          200,000/0
</TABLE>


BOARD COMPENSATION

         Dr. Shyam B. Paryani was granted an option to purchase 50,000 shares of
our common stock, at an exercise price of $2.00 per share, for serving as
Chairman of the Board.

         Each non-employee member of our Board, excluding the Chairman, is
granted options to purchase 1,000 shares of our common stock for each Director's
meeting and subcommittee meeting for which they attend. The purchase price of
the shares of common stock underlying such options will be equal to the fair
market value of our common stock on the date the option is granted. In 2001, the
purchase price was $2.00 per share for all shares granted. The shares granted to
each Board member for attending meetings is as follows:

                                       37
<PAGE>

       Board Member                          Number of Shares
       ------------                          ----------------
       Charles J. Jacobson                      11,000

       Stanley S. Trotman                        9,000

       Gordon C. Rausser                         8,000

       John H. Zeeman, Jr.                      19,000

       John W. Wells, Jr.                        5,000

         In fiscal 2001, each of Shyam B. Paryani and John H. Zeeman was granted
options to purchase 50,000 shares of our common stock at an exercise price of
$2.00 per share for services performed in the Company's reorganization.

EMPLOYMENT CONTRACTS

         Mr. Goffman serves as our Chief Executive Officer pursuant to the terms
of a five-year employment agreement, as amended on September 13, 2000. Mr.
Goffman's employment agreement will terminate in three years on May 22, 2005.
Under the terms of his employment agreement, Mr. Goffman receives a base salary
of $250,000 per year, which increases by at least 5% each year. In addition, Mr.
Goffman receives a bonus ranging from a minimum of $50,000 to a maximum of
$100,000. His bonus increases on a pro rata basis based upon the amount of an
investment in our common stock. Thus, to obtain the minimum bonus there must be
a $3 million investment and to obtain the maximum bonus there must be a $5
million investment. If Mr. Goffman's employment agreement is terminated by us
for any reason other than "cause," as defined in Mr. Goffman's employment
agreement, he is entitled to the following severance:

         (1)      One-sixth (1/6) of his then annual salary, plus one-sixth
                  (1/6) of any bonus paid to him or accrued for his benefit
                  within the previous twelve (12) months.

         (2)      All of his employee stock options will immediately vest and he
                  will become entitled to a cashless exercise of his employee
                  stock options. In accordance with his cashless exercise, we
                  will issue shares of our common stock with a value equal to
                  the difference between the fair market value of our shares and
                  the exercise price of the options.

         (3)      Any and all accrued vacation pay, back wages and accrued sick
                  pay; and

         (4)      Medical benefits until Mr. Goffman becomes eligible for
                  another  employer's  health  insurance or six months,
                  whichever occurs first.

         If Mr. Goffman's employment agreement is terminated by reason of death
or long-term disability, then he is entitled to one-sixth of his then annual
base salary, plus one-sixth of any bonuses paid or accrued to the employee
within the previous 12 months.

         Under the terms of his employment agreement, Mr. Goffman received
options to purchase 200,000 shares of common stock, at an exercise price of
$2.00 per share.

                                       38
<PAGE>

ITEM 11. PRINCIPAL STOCKHOLDERS

         The following table shows certain information relating to the
beneficial ownership of the Company as of December 31, 2001 of (i) each person
known to us to be the beneficial owner of more than 5% of our voting shares,
(ii) each of our directors and Named Executive Officers, and (iii) all directors
and executive officers as a group.

                                            Amount and Nature    Percent of
Name and Address                Title of    of Beneficial        Voting
of Beneficial Owner (1)         Class       Ownership (2)        Stock Owned
-----------------------         -----       -------------        -----------

Shyam B. Paryani, MD            Common       522,098(3)           5.10%
                                Series D     320,513
                                Preferred

Jeffrey A. Goffman              Common       1,157,933(4)         7.00%

Gerald D. Boyajian              Common       3,540(5)             0.02%

Richard A. Baker                Common          -0-

Stanley S. Trotman, Jr.         Common       132,400(6)           0.80%

Gordon C. Rausser               Common       163,500(7)           1.00%

Charles J. Jacobson             Common       190,000(8)           1.15%

John H. Zeeman                  Common        52,000(9)           0.32%

John W. Wells, Jr., MD          Common       129,634              2.72%
                                Series D     320,513
                                Preferred


John J. Fuery, MD               Common       2,278,303(10)       13.78%
44 Farragut Avenue
Piedmont, CA 94610

Richard W. Padelford            Common       238,333(11)          1.44%
11218 Scarlet Oak Drive
Oakdale, CA  95361

Douglas A. McBride              Common       49,333(12)           0.30%
181 Oak Road
Alamo, CA 94507

DVI Financial Services, Inc.    Common       1,337,758            8.09%
5355 Town Center Road
Boca Raton, FL 33486

                                       39
<PAGE>

<TABLE>
<CAPTION>
<S>                                                   <C>       <C>                 <C>
Mercurius Beleggingsmaatschappij BV and               Series E      1,538,462 (13)      9.30%
Participatie Maatschappij Avanti Limburg BV           Preferred
Akerstraat 126
6417 AG Heerlen
Netherlands

Stichting Administratiekantoor Aandelen Stienstra
Akerstraat 126
PO Box 299
6400 AG Heerlen
Netherlands

Alpine Venture Capital Partners, LP                   Series E      1,538,462           9.30%
One North Clematis Street, Suite 510                  Preferred
West Palm Beach, FL 33401

Officers and Directors as a Group                     Common        2,351,905          18.10%
                                                      Preferred       641,026
</TABLE>


         We believe, based on information provided by these persons, that the
persons listed have sole voting and investment power with respect to all shares
shown as beneficially owned by them. Furthermore, information presented in this
table and related notes have been obtained from the beneficial owner or from
reports filed by the beneficial owner with the SEC under Section 13 of the
Exchange Act.

(1)  Unless otherwise indicated, the address of all persons listed is c/o OnCure
     Technologies, 7450 East River Road, Suite 3, Oakdale, CA 95361.

(2)  Common stock includes shares (i) underlying options and warrants currently
     exercisable or exercisable within 60 days of February 28, 2002, and/or (ii)
     issuable upon conversion of non-voting Preferred Stock currently
     convertible or convertible within 60 days of February 28, 2002, which are
     deemed outstanding for the purpose of computing the amount of shares owned
     by, and percentage ownership of, the person holding the options or
     warrants, but are not deemed outstanding for the purpose of computing the
     percentage ownership of any other person.

     The number of shares of Preferred Stock listed above reflects the number of
     votes to which the person holding such shares is entitled, not the actual
     number of shares owned.

(3)  Includes the beneficial ownership of an aggregate of 121,000 shares of our
     common stock issuable upon the exercise of certain stock options.

(4)  Includes the beneficial ownership of an aggregate of 122,933 shares of our
     common stock issuable upon the exercise of certain stock options and 10,000
     shares of our common stock issuable upon the exercise of certain warrants.

(5)  Includes the beneficial ownership of an aggregate of 3,540 shares of our
     common stock issuable upon exercise of certain stock options.

(6)  Includes the beneficial ownership of an aggregate of 29,000 shares of our
     common stock issuable upon the exercise of certain stock options.

(7)  Includes the beneficial ownership of an aggregate of 26,000 shares of our
     common stock issuable upon the exercise of certain stock options and 10,000
     shares of our common stock issuable upon the exercise of certain warrants.

                                       40
<PAGE>

(8)  Includes the beneficial ownership of an aggregate of 55,000 shares of our
     common stock issuable upon the exercise of certain stock options and 10,000
     shares of our common stock issuable upon the exercise of certain warrants.

(9)  Includes the beneficial ownership of an aggregate of 52,000 shares of our
     common stock issuable upon exercise of certain stock options.

(10) John J. Fuery served as a member of the Company's Board of Directors from
     May 1998 to December 2000.

(11) Includes the beneficial ownership of an aggregate of 113,333 shares of our
     common stock issuable upon the exercise of certain stock options.

(12) Includes the beneficial ownership of an aggregate of 49,333 shares of our
     common stock issuable upon the exercise of certain currently exercisable
     stock options.

(13) Mercurius Beleggingsmaatschappij BV and Participatie Maatschappij Avanti
     Limburg BV each own directly 250 shares of our Series E Preferred Stock
     which are convertible into 769,231 shares of our common stock. Based on a
     Schedule 13G filed with the SEC on May 30, 2001, Mercurius and Avanti are a
     group and are deemed to own each other's shares (an aggregate of 1,538,462
     shares of our common stock). The Schedule 13G also states that Mercurius is
     wholly owned by Stichting Administratiekantoor Aandelen Stienstra, which is
     deemed to own the shares beneficially owned by Mercurius.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

CERTAIN TRANSACTIONS WITH DR. SHYAM B. PARYANI, THE CHAIRMAN OF THE BOARD OF
DIRECTORS.

         In December 2000, the Company's wholly-owned subsidiary, U.S. Cancer
Care issued a $123,511 promissory note to Dr. Paryani. In March 2002, the
Company paid $110,701 to Dr. Paryani ($106,820 as payment for the outstanding
balance of principal on the note and $3,881 as payment for all accrued interest
on the note).

CERTAIN TRANSACTIONS WITH DR. SHYAM B. PARYANI, THE CHAIRMAN OF THE BOARD OF
DIRECTORS, AND DR. JOHN W. WELLS, JR., A MEMBER OF THE BOARD OF DIRECTORS.

         The  Company  leases the Florida  Cancer  Center - Orange Park and the
Florida  Cancer  Center - Palatka  from  entities affiliated with Dr. Paryani
and Dr. Wells. The Company's  annual rental  payments,  in accordance with the
terms of these leases, are $174,000 (Orange Park) and $90,000 (Palatka).

CERTAIN TRANSACTIONS WITH DVI FINANCIAL SERVICES, INC., THE BENEFICIAL OWNER OF
MORE THAN 5% OF THE COMPANY'S VOTING SECURITIES.

         In September 2001, the Company entered into an exchange agreement with
DVI Financial Services, Inc. whereby:

     o    DVI exchanged 1,000 shares of its Series B Cumulative Accelerating
          Redeemable Preferred Stock, par value $0.001 per share (the "Series B
          Stock"), together with all accrued and unpaid dividends on the Series
          B Stock, for an aggregate of 1,337,738 shares of the Company's Common
          Stock (147,262 shares of Common Stock were issued as payment for
          accrued and unpaid dividends); and

     o    DVI agreed not to exercise its right to convert its shares of the
          Series C Cumulative Accelerating Redeemable Preferred Stock, par value
          $0.001 per share, into shares of the Company's Common Stock until
          September 7, 2002.

         As a way of financing certain aspects of its operations, the Company
obtains financing from DVI. The Company has entered into a series of financing
agreements with DVI. At December 31, 2001, the principal amount of borrowings
under these agreements was approximately $13.1 million with interest rates
ranging from 8.8% to 12.4 %. During the fiscal year 2001, we paid DVI
approximately $1.4 million as payment for accrued interest on these borrowings.

                                       41
<PAGE>

         DVI provides the Company with a revolving line of credit pursuant to
three loan and security agreements. The maximum amount available under this
credit facility is $4.4 million with advances limited to eighty-five percent
(85%) of eligible account receivables. Borrowings under the line of credit bear
interest at a rate that ranges between 2.0% to 2.25% over the prime lending
rate. This line of credit expires on June 30, 2004 but is renewable for a
one-year term at the expiration date. At December 31, 2001, we had approximately
$3.8 million of borrowings under this credit facility.

         The Company's Calallen Regional Cancer Center is subject to a $1.4
million mortgage and the Company's Valley Regional Cancer Center 1 is subject to
a $800,000 mortgage. Each mortgage is held by DVI.

CERTAIN TRANSACTIONS WITH DR. JOHN J. FUERY, THE BENEFICIAL OWNER OF MORE THAN
5% OF THE COMPANY'S VOTING SECURITIES AND A FORMER MEMBER OF THE BOARD OF
DIRECTORS.

         In May 2001, the Company entered into an agreement with Dr. Fuery and
Continuum Capital Partners, Inc. in connection with the settlement of Dr.
Fuery's claim that certain indebtedness owed to him was due and payable.
Pursuant to the terms of this agreement: (i) Dr. Fuery was paid a lump sum of
cash in the amount of $428,000; (ii) $766,551 (representing principal, interest,
expenses, rents and other amounts due to Dr. Fuery) converted into 358,168
shares of our Common Stock, at a conversion price of $2.00 per share; (iii)
Continuum Capital Partners, Inc. was given the right to purchase, on or before
November 10, 2002, 358,168 shares of our Common Stock held by Dr. Fuery, at an
exercise price of $2.25 per share; and (iv) Dr. Fuery was given the right to
require the Company to purchase any portion of his 358,168 shares of Common
Stock that is not purchased by Continuum Capital Partners, Inc. at $2.00 per
share. See "Legal Proceedings."

         The Company leases the East Bay Regional Cancer Center, the Turlock
Regional Cancer Center and the Sonora Cancer Center from a corporation owned by
Dr. Fuery. The Company's rental payments, in accordance with the terms of these
leases, are $211,000 (East Bay), $127,000 (Turlock) and $67,000 (Sonora).

CERTAIN TRANSACTIONS WITH W. BRIAN FUERY, THE SON OF DR. JOHN J. FUERY AND A
FORMER MEMBER OF THE BOARD OF DIRECTORS.

         In April 2000, the Company's wholly-owned subsidiary, U.S. Cancer Care,
entered into a partnership agreement with U.S. Cancer Management Corporation, a
corporation wholly owned by W. Brian Fuery for the purpose of developing and
building outpatient radiation treatment centers in Northern California. Pursuant
to the terms of this partnership agreement, all profits realized by the
partnership are distributed 51% to U.S. Cancer Management Corporation and 49% to
U.S. Cancer Care. In addition, the partnership agreement required U.S. Cancer
Care to provide the partnership with a $300,000 loan (which was provided in May
2001) and to provide or obtain financing for the development of new centers in
Rohnert Park and Fresno, California. If U.S. Cancer Care failed to provide the
partnership with the loan or fails to provide or obtain the required financing
for the centers, its interest in these centers will automatically be reduced
from 49% to 5%. In September 2001, U.S. Cancer Management Corporation notified
U.S. Cancer Care that its interest in each of these centers had been reduced to
5%.

         In February 2002, the Company entered into a settlement agreement with
W. Brian Fuery and two entities controlled by him (Stunner Corporation and U.S.
Cancer Management Corporation) in connection with the lawsuit filed by U.S.
Cancer Care. See "Legal Proceedings." Pursuant to the terms of the settlement
agreement, the Company: (i) exchanged its interest in the USCMC-USCC Partnership
for 642,833 shares of the Company's common stock held by W. Brian Fuery, (ii)
paid W. Brian Fuery $31,120, (iii) agreed to pay certain additional obligations
amounting to $16,390, (iv) transferred title to certain furniture and equipment
to W. Brian Fuery, and (v) agreed to pay a portion of the monthly payments for
office space used by W. Brian Fuery.

         Prior to September 1, 2001, the Company leased the Ceres Storage
Warehouse, a storage warehouse located in Ceres, California, from Mr. Fuery.
During the fiscal year 2001, the Company paid $28,500 annually to rent this
facility.

                                       42
<PAGE>
<TABLE>
<CAPTION>
<S>       <C>
ITEM 1 3. EXHIBITS AND REPORTS ON FORM 8-K

(a)      Exhibits:

2.1      Agreement and Plan of Reorganization, dated as of December 5, 2000, by and

         Between Worldwide Equipment Corp and U.S. Cancer Care, Inc. (1)

3.1      Articles of Incorporation of the Registrant dated June 14, 1993. (2)

3.2      Certificates of Amendment to the Articles of Incorporation of the Registrant dated
         April 21, 1997. (3)

3.3      Certificate of Amendment to the Articles of Incorporation of the Registrant dated
         August 11, 1997 (3)

3.4      Articles of Amendment to the Articles of Incorporation of the Registrant dated
         December 15, 1997. (2)

3.5      Articles of Amendment to the Articles of Incorporation of the Registrant dated
         September 15, 1999. (2)

3.6      Articles of Amendment to the Articles of Incorporation of the Registrant dated
         November 13, 2000, effecting a reverse stock split. (4)

3.7      Articles of Amendment to the Articles of Incorporation of the Registrant dated
         March 19, 2001. (5)

3.8      Articles of Amendment to the Articles of Incorporation of the Registrant dated
         January 18, 2001. (6)

3.9      By-Laws of the Registrant. (7)

4.1      Put Option Agreement, dated June 28, 2001, by and between CRC Partners, LTD. and
         OnCure Technologies Corp.

4.2      Put Option Agreement, dated June 28, 2001, by and between Akiva Merchant Group,
         Inc. and OnCure Technologies Corp.

4.3      Put Option Agreement, dated June 28, 2001, by and between Kaufman Family Ltd.
         Trust and OnCure Technologies Corp.

4.4      Intentionally left blank.

4.5      Amendment to Put Option Agreement, dated June 28, 2001, by and between CRC
         Partners and OnCure Technologies Corp.

4.6      Amendment to Put Option Agreement, dated June 28, 2001, by and between Akiva
         Merchant Group, Inc. and OnCure Technologies Corp.

4.7      Amendment to Put Option Agreement, dated June 28, 2001, by and between Kaufman
         Family Ltd. Trust and Oncure Technologies Corp.

10.1     Employment Agreement, dated as of May 22, 1998, by and between Jeffrey A. Goffman
         and U.S. Cancer Care. (3)

10.2     Amendment to Employment Agreement, dated as of September 13, 2000, by and between
         Jeffrey A. Goffman and U.S. Cancer Care. (3)

10.3     2001 OnCure Technologies Corp. Stock Option Plan. (8)

10.4     Professional Services Agreement, dated as of August 1, 1999, by and between The
         Permanente Medical Group, Inc., Radiation Oncology Medical Group and USCC Health
         Care Management Corporation. (9)

10.5     Assignment of and Amendment to Agreement, dated as of August 1, 2000, by and
         between The Permanente Medical Group, Inc., Radiation Oncology Medical Group, USCC
         Health Care Management Corporation, USCC Medical Group-CA, Inc. and USCMC-USCC
         Partnership. (9)

10.6     Second Assignment of and Amendment to Agreement, dated as of April 1, 2001, by and
         among The Permanente Medical Group, Inc., Radiation Oncology Medical Group, USCC
         Health Care Management Corporation, USCC Medical Group-CA, Inc., USCMC-USCC
         Partnership and AuSam Medical Group, Inc. (9)

10.7     Medical Services Agreement, dated as of December 1, 2001, by and between U.S.
         Cancer Care Florida Radiation Oncology Group. (10)

10.8     Conversion of Notes Agreement, dated as of May 10, 2001, by and among OnCure
         Technologies Corp., Dr. John J. Fuery and Continuum Capital Partners, Inc.

10.9     Settlement Agreement and Mutual General Release, dated as of February 28, 2002, by
         and among W. Brian Fuery, Stunner Corporation, U.S. Cancer Management Corporation,
         USCMC-USCC Partnership, U.S. Cancer Care, Inc., and OnCure Technologies Corp.
</TABLE>



                                       43
<PAGE>


<TABLE>
<CAPTION>
<S>                                                                            <C>
16.1     Letter from Moore Stephens regarding change in certifying accountant. (11)

21.1     List of Subsidiaries.
---------------------------------------

(1)      Filed as an exhibit to the Current Report on Form 8-K filed by the Company on
         January 17, 2001.

(2)      Filed as an exhibit to the Registration Statement on Form 10-SB filed by the
         Company on June 13, 2000.

(3)      Filed as an exhibit to the Annual Report on Form 10-KSB filed by the Company on
         April 15, 2001.

(4)      Filed as an exhibit to the Current Report on Form 8-K filed by the Company on
         November 11, 2000.

(5)      Filed as an exhibit to the Definitive Information Statement on Schedule 14C filed
         by the Company on February 27, 2001.

(6)      Filed as an exhibit to the Current Report on Form 8-K filed by the Company on
         January 18, 2001.

(7)      Filed as an exhibit to Amendment No. 1 to the Registration Statement on Form 10-SB
         filed by the Company on June 22, 2000.

(8)      Filed as an exhibit to the Registration Statement on Form S-8 filed by the Company
         on January 16, 2002.

(9)      Filed as an exhibit to Amendment No. 2 of the Annual Report on Form 10-KSB/A filed
         by the Company on October 18, 2001.

(10)     Filed as an exhibit to Amendment No. 4 to the Registration Statement on Form SB-2
         filed by the Company on October 19, 2001.

(11)     Filed as exhibit to the Current Report on Form 8-K/A filed by the Company on
         December 13, 2001.
</TABLE>


(b)      Current Reports on Form 8-K.

         On November 21, 2001, the Company filed a Current Report on Form 8-K
reporting, under Item 4, that the Company changed its independent auditors from
Moore Stephens, P.C. to Moss Adams LLP.

         On December 13, 2001, the Company filed a Current Report on Form 8-K/A
amending and restating the Company's November 21, 2001 Current Report on Form
8-K and reporting, under Item 4, that the Company changed its independent
auditors from Moore Stephens, P.C. to Moss Adams LLP.



                                       44
<PAGE>




                                  SIGNATURES

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


                                      ONCURE TECHNOLOGIES CORP.


Dated: March 29, 2002                 By:      /s/ Jeffrey A. Goffman
                                               ----------------------
                                               Jeffrey A. Goffman
                                               Chief Executive Officer,
                                               President, Secretary and Director


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

<TABLE>
<CAPTION>
          NAME                               POSITION
          ----                               --------

<S>                             <C>                                        <C>
/s/ Shyam B. Paryani, MD        Chairman of the Board of Directors         March 29, 2002
------------------------------
Shyam B. Paryani, MD

/s/ Jeffrey A. Goffman          Chief Executive Officer, President,        March 29, 2002
------------------------------  Secretary and Director
Jeffrey A. Goffman

/s/ Richard A. Baker            Chief Financial Officer and Senior         March 29, 2002
------------------------------  Vice President (principal
Richard A. Baker                accounting officer)

/s/ Charles J. Jacobson         Director of Managed Care Contracting       March 29, 2002
------------------------------  and Director
Charles J. Jacobson

/s/ Stanley S. Trotman, Jr.     Director                                   March 29, 2002
------------------------------
Stanley S. Trotman, Jr.

/s/ Gordon C. Rausser, Ph.D.    Director                                   March 29, 2002
------------------------------
Gordon C. Rausser, Ph.D.

/s/ John H. Zeeman              Director                                   March 29, 2002
------------------------------
John H. Zeeman

/s/ John W. Wells, Jr., MD      Director                                   March 29, 2002
------------------------------
John W. Wells, Jr., MD
</TABLE>

                                       45
<PAGE>



FINANCIAL STATEMENTS:

<TABLE>
<CAPTION>
<S>                                                                                           <C>
Report of Independent Auditors..............................................................F-1

Consolidated Balance Sheet as of December 31, 2001 and 2000.................................F-2 - F-3

Consolidated Statements of Operations for the years ended
December 31, 2001, 2000 and 1999............................................................F-4

Consolidated Statements of Stockholders' Equity for the years ended December 31,
2001, 2000 and 1999.........................................................................F-5 - F-6

Consolidated Statements of Cash Flows for the years ended December 31, 2001,
2000 and
1999........................................................................................F-7 - F-9

Notes to Consolidated Financial Statements..................................................F-10 - F-38
</TABLE>


                                    .........




                                       46

<PAGE>

INDEPENDENT AUDITOR'S REPORT

To the Board of Directors and Stockholders of
OnCure Technologies Corp. and Subsidiaries


We have audited the accompanying consolidated balance sheet of OnCure
Technologies Corp. and subsidiaries as of December 31, 2001 and the related
consolidated statements of operations, stockholders' equity and cash flows for
the year ended December 31, 2001. These consolidated financial statements are
the responsibility of the Company's management. Our responsibility is to express
an opinion on these consolidated financial statements based on our audit.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of OnCure
Technologies Corp. and subsidiaries as of December 31, 2001, and the results of
their operations and their cash flows for the year then ended, in conformity
with accounting principles generally accepted in the United States of America.

As discussed in Notes 1 and 14 to the consolidated financial statements, the
Company restated its December 31, 2000 consolidated financial statements.

Stockton, California
February 22, 2002


<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
--------------------------------------------------------------------------------

                                     ASSETS

<TABLE>
<CAPTION>
                                                             DECEMBER 31,
                                                   --------------------------------
                                                         2001              2000
                                                   -------------     --------------
                                                                     (As Restated)
<S>                                                <C>               <C>
 CURRENT ASSETS
    Cash                                           $      12,347     $       50,696
    Certificate of deposit                               400,000              -
    Accounts receivable - net                          5,464,097          5,100,048
    Prepaid expenses and other                           553,184            335,086
    Deferred income taxes                                246,711            289,505
                                                   -------------     --------------
             Total current assets                      6,676,339          5,775,335

 RESTRICTED CASH                                       1,025,000                 -

 PROPERTY AND EQUIPMENT - net                         15,512,150         14,845,477

 DEFERRED LOAN COSTS, net of accumulated                       -            161,077
    amortization

 EXCESS OF COST OVER FAIR VALUE OF
    NET ASSETS ACQUIRED, net of accumulated
       amortization                                   13,258,512         15,415,295

 OTHER ASSETS, net                                       465,895            461,614
                                                   -------------     --------------
             Total assets                          $  36,937,896     $   36,658,798
                                                   =============     ==============
</TABLE>

F-2                                                       See accompanying notes
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                                     CONSOLIDATED BALANCE SHEETS
--------------------------------------------------------------------------------

                       LIABILITIES AND STOCKHOLDERS'EQUITY

<TABLE>
<CAPTION>
                                                                        DECEMBER 31,
                                                              --------------------------------
                                                                    2001              2000
                                                              --------------    --------------
                                                                                (As Restated)
<S>                                                           <C>               <C>
 CURRENT LIABILITIES
    Accounts payable                                          $    3,266,504    $    2,540,706
    Accrued liabilities                                            1,682,793         1,260,532
    Notes payable to stockholders                                         -            360,000
    Lines of credit                                                3,759,177         2,602,188
    Current portion of long-term debt                              3,785,184         4,987,316
                                                              --------------    --------------
              Total current liabilities                           12,493,658        11,750,742

 LONG - TERM DEBT                                                 13,926,293        13,202,677

 DEFERRED INCOME TAXES                                               246,711           580,378
                                                              --------------    --------------
              Total liabilities                                   26,666,662        25,533,797
                                                              --------------    --------------
 MINORITY INTEREST                                                   653,425            72,529
                                                              --------------    --------------
 COMMITMENTS AND CONTINGENCIES                                            -                 -
                                                              --------------    --------------
 Common stock - contingent, 655,668 and 612,500
    shares issued and outstanding at December 31, 2001
    and 2000, respectively                                         1,311,336         1,225,000
                                                              --------------    --------------
 Redeemable preferred stock, $. 001 par value,
      1,000 shares issued and outstanding (liquidation
       preference $2,500,000)                                             -          2,725,000
                                                              --------------    --------------
 STOCKHOLDERS' EQUITY
    Preferred stock, $. 001 par value, 1,000,000 shares
       authorized, 3,000 and 1,000 shares issued and out-
       standing at December 31, 2001 and 2000, respectively       11,500,000         5,000,000

    Common stock, $. 001 par value, 100,000,000 shares
       authorized, 10,290,054 and 7,412,316 shares issued
       and outstanding at December 31, 2001 and 2000,
       respectively                                                   10,290             7,413

 ADDITIONAL PAID-IN CAPITAL                                        8,809,390         6,714,238

 DEFERRED COMPENSATION                                                    -            (71,050)

 ACCUMULATED DEFICIT                                            (12,013,207)        (4,548,129)
                                                              --------------    --------------
              Total stockholders' equity                           8,306,473         7,102,472
                                                              --------------    --------------
              Total liabilities and stockholders' equity      $   36,937,896    $   36,658,798
                                                              ==============    ==============
</TABLE>

See accompanying notes                                                       F-3
--------------------------------------------------------------------------------
<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                        YEARS ENDED DECEMBER 31,
                                            ----------------------------------------------
                                                 2001             2000             1999
                                            -------------   -------------    -------------
                                                             As Restated
<S>                                         <C>              <C>             <C>
 REVENUES
    Net patient service revenues            $  22,324,263    $ 19,769,839    $  16,731,633
    Other revenues                                408,045         239,115           44,060
                                            -------------   -------------    -------------
              Total revenues                   22,732,308      20,008,954       16,775,693
                                            -------------   -------------    -------------
 OPERATING EXPENSES
    Salaries and benefits                       6,362,267       5,626,454        5,205,148
    Medical supplies and services               5,325,242       4,172,424        3,415,567
    General and administrative                  8,281,627       5,512,691        4,671,262
    Non-cash stock option compensation             56,566       1,373,000               -
    Depreciation and amortization               3,097,583       2,170,921        1,950,346
    Impairment loss                             2,893,851               -               -
                                            -------------   -------------    -------------
              Total operating expenses         26,017,136      18,855,490       15,242,323
                                            -------------   -------------    -------------
 (LOSS) INCOME FROM OPERATIONS                 (3,284,828)      1,153,464        1,533,370
                                            -------------   -------------    -------------
 OTHER INCOME (EXPENSE)
    Interest income                               100,573          26,609           23,671
    Interest expense                           (2,467,891)     (2,242,717)      (2,046,084)
    Amortization of deferred loan costs          (161,077)       (256,664)        (228,458)
    Other (expense) income, net                (1,061,832)         (1,379)          12,463
                                            -------------   -------------    -------------
              Total other expense, net         (3,590,227)     (2,474,151)      (2,238,408)
                                            -------------   -------------    -------------
 LOSS BEFORE MINORITY INTEREST
    AND INCOME TAX BENEFIT                     (6,875,055)     (1,320,687)        (705,038)

 MINORITY INTEREST                               (580,896)       (372,366)        (220,564)

 INCOME TAX BENEFIT                               290,873         417,002            8,875
                                            -------------   -------------    -------------
 NET LOSS                                   $  (7,165,078)  $  (1,276,051)   $    (916,727)
                                            =============   =============    =============
 NET LOSS                                   $  (7,165,078)  $  (1,276,051)   $    (916,727)

 Deduct: Preferred stock dividends                834,250         575,000          460,000
          Imputed non-cash preferred
              stock dividends                          -          558,007        1,102,018
                                            -------------   -------------    -------------
 NET LOSS USED IN PER COMMON
    SHARE CALCULATION                       $  (7,999,328)  $  (2,409,058)   $  (2,478,745)
                                            =============   =============    =============

 BASIC AND DILUTED LOSS PER
    COMMON SHARE                            $       (0.89)  $       (0.30)   $       (0.31)
                                            =============   =============    =============
 WEIGHTED AVERAGE COMMON SHARES
    OUTSTANDING - basic and diluted             9,018,330       8,024,816        8,024,816
                                            =============   =============    =============
</TABLE>

F-4                                                       See accompanying notes
--------------------------------------------------------------------------------
<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                  FOR THE THREE YEARS ENDED DECEMBER 31, 2001, 2000 and 1999
                                             ----------------------------------------------------------------------
                                                 Preferred Stock                 Common Stock
                                             --------------------------     ----------------------    Additional
                                             Number of                      Number of                  Paid-in
                                               Shares          Amount        Shares       Amount       Capital
                                             ----------     -----------    -----------  ----------  -------------
<S>                                            <C>          <C>             <C>         <C>         <C>
Balance, December 31, 1998                         -        $        -      3,686,700   $   36,867  $   1,218,483
Recapitalization as a result of merger             -                 -      6,666,942        6,667         (6,667)
Common stock issued to founders
  of predecessor upon occurrence
  of contingency                                   -                 -        216,667          217        352,950
Preferred stock issued for financing            1,000        5,000,000             -            -              -
Discounts on preferred stock issuance              -        (1,282,247)            -            -       1,660,025
Dividends accrued on preferred stock               -                 -             -            -        (100,000)
Amortization of discounts on preferred
  stock                                            -           746,021             -                   (1,102,018)
Amortization of common stock subject
  to repurchase                                    -                 -             -            -              -
Amortization of deferred compensation              -                 -             -            -              -
Net loss                                           -                 -             -            -              -
Recapitalization adjustment                        -                 -     (3,903,367)     (37,084)        37,084
                                             ----------     -----------    -----------  ----------  -------------
Balance, December 31, 1999                      1,000        4,463,774      6,666,942        6,667      2,059,857

Acquired equity of shell in stock
  acquisition                                      -                 -      1,357,874        1,358       (235,710)
Dividends accrued on preferred stock               -                 -             -            -        (125,000)
Amortization of discount on preferred
  stock                                            -           536,226             -            -        (558,007)
Amortization of common stock subject
  to repurchase                                    -                 -             -            -              -
Common stock subject to repurchase -
  put option waived                                -                 -        790,000          790      2,369,210
Private placement promissory notes
  converted to common stock                        -                 -        912,500          913      1,824,087
Amortization of deferred compensation              -                 -             -            -              -
Warrants exercised                                 -                 -        448,575          449          4,037
Variable stock options award
  adjustment                                       -                 -             -            -       1,373,000
Net loss                                           -                 -             -            -              -
Recapitalization adjustment                        -                 -     (2,763,575)      (2,764)         2,764
                                             ----------     -----------    -----------  ----------  -------------
Balance, December 31, 2000
(As Restated)                                   1,000        5,000,000      7,412,316        7,413      6,714,238
</TABLE>

<TABLE>
<CAPTION>
                                                         FOR THE THREE YEARS ENDED
                                                     DECEMBER 31, 2001, 2000 and 1999
                                             ------------------------------------------------

                                                                                   Total
                                                Deferred        Accumulated     Stockholders'
                                              Compensation        Deficit          Equity
                                              -------------   ---------------   -------------
<S>                                           <C>             <C>               <C>
Balance, December 31, 1998                    $    (129,850)  $    (1,683,559)  $    (558,059)
Recapitalization as a result of merger                    -                -               -
Common stock issued to founders
  of predecessor upon occurrence
  of contingency                                          -                -          353,167
Preferred stock issued for financing                      -                -        5,000,000
Discounts on preferred stock issuance                     -                -          377,778
Dividends accrued on preferred stock                      -                -         (100,000)
Amortization of discounts on preferred
  stock                                                   -                -         (355,997)
Amortization of common stock subject
  to repurchase                                           -          (395,000)       (395,000)
Amortization of deferred compensation                29,400                -           29,400
Net loss                                                  -          (916,727)       (916,727)
Recapitalization adjustment                               -                -               -
                                              -------------   ---------------   -------------
Balance, December 31, 1999                         (100,450)       (2,995,286)      3,434,562

Acquired equity of shell in stock
  acquisition                                             -                -         (234,352)
Dividends accrued on preferred stock                      -                -         (125,000)
Amortization of discount on preferred
  stock                                                   -                -          (21,781)
Amortization of common stock subject
  to repurchase                                           -          (276,792)       (276,792)
Common stock subject to repurchase -
  put option waived                                       -                -        2,370,000
Private placement promissory notes
  converted to common stock                               -                -        1,825,000
Amortization of deferred compensation                29,400                -           29,400
Warrants exercised                                        -                -            4,486
Variable stock options award
  adjustment                                              -                -        1,373,000
Net loss                                                  -        (1,276,051)     (1,276,051)
Recapitalization adjustment                               -                -               -
                                              -------------   ---------------   -------------
Balance, December 31, 2000
(As Restated)                                       (71,050)       (4,548,129)      7,102,472
</TABLE>

                                                                             F-5
--------------------------------------------------------------------------------
<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                            FOR THE THREE YEARS ENDED DECEMBER 31, 2001, 2000 and 1999
                                            ----------------------------------------------------------
                                                    Preferred Stock                Common Stock
                                               -------------------------     -----------------------
                                               Number of                     Number of
                                                 Shares          Amount        Shares        Amount
                                                 ------          ------        ------        ------
<S>                                               <C>          <C>           <C>              <C>
 Balance, December 31, 2000
 (As Restated)                                    1,000        5,000,000     7,412,316        7,413

 Preferred stock - acquisition                    1,000        2,500,000          -            -
 Preferred stock issued for cash                  1,000        4,000,000          -            -
 Accrued dividends                                -                 -             -            -
 Dividends paid on preferred stock                -                 -             -            -
 Costs associated with offering                   -                 -             -            -
 Redeemable preferred stock
   exchanged for common stock                     -                 -        1,337,738        1,337
 Common stock issued for services
   and debt                                       -                 -          530,000          530
 Exercise of options and warrants                 -                 -        1,010,000        1,010
 Amortization of deferred compensation            -                 -             -            -
 Variable stock options award
   adjustment                                     -                 -             -            -
 Compensation from issuance of stock
   options                                        -                 -             -            -
 Warrants re-priced as compensation               -                 -             -            -
 Net loss                                         -                 -             -            -
                                                  -----      -----------    ----------     --------
 Balance, December 31, 2001                       3,000      $11,500,000    10,290,054     $ 10,290
                                                  =====      ===========    ==========     ========
</TABLE>

<TABLE>
<CAPTION>
                                              FOR THE THREE YEARS ENDED DECEMBER 31, 2001, 2000 and 1999
                                            --------------------------------------------------------------

                                              Additional                                        Total
                                               Paid-in        Deferred       Accumulated     Stockholders'
                                               Capital      Compensation       Deficit          Equity
                                               -------      ------------       -------          ------
<S>                                           <C>              <C>            <C>             <C>
 Balance, December 31, 2000
 (As Restated)                                6,714,238        (71,050)       (4,548,129)     7,102,472

 Preferred stock - acquisition                     -              -                 -         2,500,000
 Preferred stock issued for cash                   -              -                 -         4,000,000
 Accrued dividends                              (84,250)          -                 -           (84,250)
 Dividends paid on preferred stock                 -              -             (300,000)      (300,000)
 Costs associated with offering                (753,637)          -                 -          (753,637)
 Redeemable preferred stock
   exchanged for common stock                 2,807,913           -                 -         2,809,250
 Common stock issued for services
   and debt                                      59,470           -                 -            60,000
 Exercise of options and warrants                 9,090           -                 -            10,100
 Amortization of deferred compensation             -            71,050              -            71,050
 Variable stock options award
   adjustment                                  (380,134)          -                 -          (380,134)
 Compensation from issuance of stock
   options                                      258,700           -                 -           258,700
 Warrants re-priced as compensation             178,000           -                 -           178,000
 Net loss                                          -              -           (7,165,078)    (7,165,078)
                                            -----------       --------     -------------    -----------
 Balance, December 31, 2001                 $ 8,809,390       $   -        $ (12,013,207)   $ 8,306,473
                                            ===========       ========     =============    ===========
</TABLE>

F-6                                                       See accompanying notes
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                           CONSOLIDATED STATEMENTS OF CASH FLOWS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                             YEARS ENDED DECEMBER 31,
                                                 ------------------------------------------------
                                                      2001             2000              1999
                                                 --------------   --------------   --------------
                                                                   As Restated
<S>                                              <C>              <C>              <C>
OPERATING ACTIVITIES
   Net loss                                      $   (7,165,078)  $   (1,276,051)  $     (916,727)
                                                 --------------   --------------   --------------
   Adjustments to reconcile net loss to net
     cash from operating activities:
       Depreciation and amortization                  3,258,660        2,427,585        2,178,804
       Loss (gain) on disposal of equipment             619,860           (1,379)          (4,690)
       Provision for doubtful accounts                       -                -           104,518
       Impairment loss                                2,893,851               -                -
       Stock-based compensation expense                  71,050           29,400           29,400
       Minority interest in income of subsidiary        580,896          372,366          220,564
       Deferred income taxes                           (290,873)        (417,002)         161,075
       Non-cash stock option and warrant
         compensation                                    56,566        1,373,000               -
       Write-down of investment in partnership          338,065               -                -
   Changes in assets and liabilities:
     (Increase) decrease in:
       Accounts receivable - net                        (21,556)      (1,582,385)        (265,374)
       Income taxes receivable                               -            50,454          618,607
       Prepaid expenses and other
        current assets                                 (218,098)         373,928         (448,251)
       Other assets                                     231,660          194,358          178,627
     Increase (decrease) in:
       Accounts payable and accrued expenses            862,465          607,147          823,200
       Income taxes payable                                  -                -          (834,256)
       Other current liabilities                             -           (36,259)           9,009
                                                 --------------   --------------   --------------
         Total adjustments                            8,382,546        3,391,213        2,771,233
                                                 --------------   --------------   --------------
         Net cash from operating activities           1,217,468        2,115,162        1,854,506
                                                 --------------   --------------   --------------
INVESTING ACTIVITIES
   Purchases of property and equipment               (2,657,676)      (4,922,968)        (590,647)
   Acquisitions                                              -                -          (252,626)
   Investment in certificate of deposit                (400,000)              -                -
   Investment in partnership                           (889,408)              -                -
   Restricted cash                                   (1,025,000)              -                -
   Other                                                     -          (287,761)        (119,118)
                                                 --------------   --------------   --------------
         Net cash from investing activities          (4,972,084)      (5,210,729)        (962,391)
                                                 --------------   --------------   --------------
</TABLE>

                                                                             F-7
--------------------------------------------------------------------------------

<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                            YEARS ENDED DECEMBER 31,
                                                 ----------------------------------------------
                                                      2001             2000           1999
                                                 -------------    --------------  -------------
                                                                  As Restated
<S>                                              <C>              <C>             <C>
FINANCING ACTIVITIES
  Preferred stock issued                             4,000,000                -              -
  Private placement offering costs                    (753,637)               -              -
  Common stock issued                                   10,100             4,486             -
  Proceeds from long-term debt                       2,525,603         4,987,445      1,220,836
  Repayments of long-term debt                      (3,312,785)       (2,414,436)    (1,296,056)
  Redemption of common stock - contingent             (335,000)               -              -
  Repayment of note payable to stockholder            (300,000)               -              -
  Net increase (decrease) in lines of credit         2,181,986           764,000       (102,678)
  Dividends paid                                      (300,000)               -              -
  Deferred loan costs                                        -                -         (19,944)
  Distributions to minority owners                           -          (220,564)      (690,000)
                                                 -------------    --------------  -------------
         Net cash from financing activities          3,716,267         3,120,931       (887,842)
                                                 -------------    --------------  -------------
NET CHANGE IN CASH                                     (38,349)           25,364          4,273

CASH, beginning of year                                 50,696            25,332         21,059
                                                 -------------    --------------  -------------
CASH, end of year                                $      12,347    $       50,696  $      25,332
                                                 =============    ==============  =============

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
  Cash paid during the periods for:
  Interest                                       $   2,383,485    $    2,251,437  $   2,067,309
  Income taxes                                   $      15,671    $       15,398  $      42,150
</TABLE>

F-8
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                           CONSOLIDATED STATEMENTS OF CASH FLOWS
--------------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                            YEARS ENDED DECEMBER 31,
                                                 ------------------------------------------------
                                                      2001             2000             1999
                                                 -------------    ------------     --------------
                                                                  As Restated
<S>                                              <C>              <C>              <C>
SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES
  Effect of Acquisitions:
  Excess of purchase price over fair
    value of net assets acquired                 $     940,967    $           -    $    2,500,000
  Other assets acquired                                342,493                -                -
  Property and equipment                             1,250,000                -         2,500,000
                                                 -------------    ------------     --------------
         Total assets acquired, net of cash          2,533,460                -         5,000,000

  Liabilities assumed                                  (33,460)          174,352               -
  Notes payable                                              -            60,000       (2,500,000)
  Issuance of preferred stock                       (2,500,000)               -        (2,500,000)
  Acquired equity deficit                                    -          (234,352)               -
                                                 -------------    --------------   --------------
CASH PAID FOR ACQUISITIONS                       $           -    $           -    $           -
                                                 ============     ==============   ==============
  Purchase of equipment for notes payable        $           -    $    4,987,000   $    3,436,000
  Preferred stock issued for financing           $   2,500,000    $           -    $    5,000,000
  Common stock issued to founders of
    predecessor upon occurrence of
       contingency                               $           -    $           -    $      353,167
  Common stock exchanged for redeemable
    preferred stock                              $   2,809,250    $           -    $           -
  Debt converted to equity                       $      60,000    $    3,050,000   $           -
  Debt converted to common stock - contingent    $     716,336    $           -    $           -
  Dividends accrued                              $      84,250    $      125,000   $      100,000
  Accrued redemption of common stock -
    contingent                                   $     295,000    $           -    $           -
</TABLE>

See accompanying notes                                                       F-9
--------------------------------------------------------------------------------

<PAGE>
ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
--------------------------------------------------------------------------------


NOTE 1 - ORGANIZATION AND OPERATIONS


OnCure Technologies Corp. (referred to herein as "we", the "Company" or
"OnCure") is a Florida corporation formed in 1993. OnCure is engaged in the
development, acquisition and ownership of outpatient radiation oncology
facilities. Additionally, we provide the software, management services,
facilities and equipment, administration and technical support, and ancillary
services necessary for physicians to establish and maintain a fully integrated
network of outpatient radiation oncology care. As of December 31, 2001, we
operated six centers in Florida, six centers in California and one in Texas.

We own 100% of the outstanding stock of U.S. Cancer Care, Inc. and Subsidiaries
("USCC") as described in REORGANIZATION below. USCC operates five centers in
Florida, the six centers in California, and the center in Texas. USCC also
operates a mobile High Dose Rate Brachytherapy ("HDR") unit in Northern
California.

We are a 50% owner and managing general partner of a partnership that operates
one oncology center and a HDR unit in Florida. As the managing general partner,
we have sole decision making responsibilities related to partnership operating
and financial policies including control of partnership assets. Accordingly, the
partnership balance sheet and statement of operations have been included in our
consolidated financial statements for all years presented.

We have one mobile Positron Emission Tomography ("PET") unit servicing the
Florida cancer centers. The PET Unit is owned and operated by a limited
liability company of which we own 80% (the "PET LLC"). The PET LLC was formed on
March 6, 2000 and the unit began operating in 2001. The balance sheet and
statement of operations of the PET LLC as of and for the year ended December 31,
2001 and 2000 have been included in our consolidated financial statements.

REORGANIZATION - The financial statements as of and for the year ended December
31, 2000 give effect to the reorganization agreement (the "agreement") of OnCure
Technologies, Inc. (formerly Worldwide Equipment Corporation) with USCC. The
closing date of the agreement was December 30, 2000. For accounting purposes,
the transaction is treated as being effective December 5, 2000, the date the
plan of reorganization was approved by the shareholders. In connection with the
agreement, Worldwide Equipment Corporation ("Worldwide") issued 6,666,942 shares
of common stock to shareholders of USCC. As a result of the agreement, upon
consummation of the reorganization the shareholders of USCC owned approximately
83% of the basic and 91% of the fully diluted common stock of Worldwide. For
accounting purposes, the agreement was recorded as a recapitalization of USCC,
with USCC as the acquirer. The 6,666,942 shares issued were treated as being
issued for cash and are shown as outstanding for all periods presented in the
same manner as for a stock split. The consolidated financial statements of the
Company reflect the results of operations and financial position of USCC and
Worldwide from December 5, 2000 through December 31, 2000. The consolidated
financial statements prior to December 5, 2000 reflect the results of operations
and financial position of USCC. Pro forma information on this transaction is not
presented as, at the date of this transaction, Worldwide was considered a public
shell and accordingly, the transaction was not considered a business
combination. Concurrent with the transaction, Worldwide Equipment Corporation
changed its name to OnCure Technologies Corp. No adjustment of assets to "fair
value" has been recorded.

F-10
--------------------------------------------------------------------------------

<PAGE>


                                    ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 1 - ORGANIZATION AND OPERATIONS (CONTINUED)

PRINCIPLES OF CONSOLIDATION - The consolidated financial statements include the
accounts of OnCure Technologies Corp. and its wholly-owned subsidiaries, as well
as a majority owned entity and one entity under effective control (see Note 1 -
Organization and Operations). All significant intercompany accounts and
transactions have been eliminated.

RESTATEMENT - Subsequent to the issuance of the consolidated financial
statements as of and for the year ended December 31, 2000, we determined that
the allowance for contractual adjustments was understated and revenue was
overstated as of and for the year ended December 31, 2000. In addition, we
determined compensation expense on the reduction of the exercise price on
options held by two directors was understated. As a result, we restated our
previously reported December 31, 2000 consolidated financial statements. A
summary of the effects of the restatement are set forth in Note 14.

MANAGEMENT'S OPERATING PLAN - The accompanying financial statements have been
prepared on a going concern basis, which contemplates the realization of assets
and the satisfaction of liabilities in the normal course of business. We have
incurred net losses of approximately $7.2 million (including one-time non-cash
charges of approximately $4.4 million), $1.3 million and $.9 million for the
years ended December 31, 2001, 2000, and 1999, respectively. At December 31,
2001, we had an accumulated deficit of approximately $12 million and a working
capital deficit of approximately $5.8 million. We plan to or have begun
implementing the following actions to ensure the Company's ability to continue
to operate as a going concern:

Liquidity and Cash Flow: The Company intends to raise additional funds of
between $3 million and $4 million by issuing equity securities, which may have
rights superior to the rights of common stock.

We have identified four properties that we currently own and plan to sell. We
believe the sales of these properties will generate $3.4 million in net
proceeds:

o    We are currently marketing cancer treatment facilities in Modesto,
     California, Corpus Christi, Texas and Jacksonville, Florida. Sales of the
     facilities would be contingent upon our ability to leaseback the property
     and continue to utilize the property in our business. Accounting for these
     future transactions will depend on the facts and circumstances of each
     transaction, but we believe that our proposed transactions would most
     likely result in the recognition of the sale of property and a
     corresponding gain or loss and the removal of the property from our balance
     sheet. The subsequent leaseback would be accounted for as an operating
     lease. The sale of these three properties is expected to result in net
     proceeds of approximately $3 million.

o    We have completed a sale of a parcel of land on March 3, 2002 for net
     proceeds of $415,000.



                                                                            F-11
--------------------------------------------------------------------------------

<PAGE>


ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 1 - ORGANIZATION AND OPERATIONS (CONTINUED)

Results of Operations: We plan to implement new treatment technology at most of
our centers over the next three years. This technology will be an addition to
the existing equipment at the facilities. Reimbursement rates have recently been
approved by various providers and provide for an incremental increase in patient
revenue per procedure. We have commitments from our primary lender to fund the
acquisition of the new treatment technology. In addition, we invested in the
mobile Positron Emission Tomography ("PET") scanner and the mobile CAT-Scan
Treatment Planning unit ("CT-Scanner") in 2001. We also have entered into
contracts with two new insurance providers that will help increase census for
one of our facilities not scheduled for equipment purchases. We plan to enhance
our marketing efforts to communicate the investments in new technology.

We have implemented action plans in the fourth quarter of 2001 to reduce
administrative overhead. We incurred a significant increase (over $1.2 million)
in temporary technician wage expense during 2001, due primarily to a shortage of
qualified full-time employees in the industry throughout much of last year. We
believe this trend is reversing and are actively recruiting permanent employees
to replace temporary technicians throughout all of our centers. We also incurred
significant legal and accounting expenses in 2001 that we do not expect to incur
in 2002.

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES

CASH AND CASH EQUIVALENTS - OnCure considers all highly liquid investments with
original maturities of three months or less to be cash equivalents. As of
December 31, 2001 and 2000, we had no cash equivalents.

RESTRICTED CASH - Restricted cash consists of a money market account at Merrill
Lynch Bank USA that must be maintained to collateralize a line of credit balance
with that institution.

ACCOUNTS RECEIVABLE - Accounts receivables represents receivables from patients
and other third-party payors for medical services provided by OnCure through its
facilities and contracted physicians. Accounts receivable represent gross
billings for patient services less estimated contractual and other adjustments.
Accounts receivable allowance was $15,284,854 and $10,625,759 at December 31,
2001 and 2000, respectively.

F-12
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

PROPERTY AND EQUIPMENT - Property and equipment purchased is stated at cost.
Property and equipment acquired in a business combination is stated at estimated
fair value at the date of acquisition. Depreciation is calculated using the
straight-line method over the following estimated useful lives:

Buildings                                25 to 39 Years
Furniture and Equipment                   5 to  7 Years
Medical Equipment                         5 to  7 Years
Leasehold Improvements                    3 to 25 Years

Depreciation expense of $2,363,528, $1,347,518 and $1,101,185 was recorded for
the years ended December 31, 2001, 2000 and, 1999, respectively. Expenditures
for maintenance and repairs, which do not improve or extend the life of the
respective assets are expensed currently while major repairs are capitalized.

LONG-LIVED ASSETS, INCLUDING THE EXCESS OF PURCHASE PRICE OVER FAIR VALUE OF NET
ASSETS ACQUIRED - Goodwill consists of the cost of purchased businesses in
excess of the fair value of net tangible assets acquired. Goodwill has been
amortized on a straight-line basis over a period of 20 years. We periodically
evaluate long-lived assets, including the excess of cost over the net assets of
outpatient centers acquired based on an evaluation of such factors as the
occurrence of a significant event or change in the operating environment and
perform an analysis to determine if the expected future net cash flows
(undiscounted) are less than the carrying amount of the assets.

We performed such an evaluation at December 31, 2001, as the Company's
significant net loss was considered a change in operating environment. Based on
our evaluation of net future undiscounted cash flows of each of our centers, the
lowest level of asset grouping from which separate cash flows could be
identified, we determined that the expected net future undiscounted cash flows
did not support the carrying value of the long-lived assets of the Corpus
Christi center. The carrying value of the long-lived assets was compared with
fair value of those assets based upon a discounted cash flow analysis to
determine impairment. Based on the analysis, an impairment loss of $2,676,615
was recorded as a reduction to operating income as required by Statement of
Financial Accounting Standards (SFAS) No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed Of." The impairment
loss consisted of a write-off of $2,254,478 in goodwill, net of accumulated
amortization, recorded upon acquisition of the center and a write-down of
$422,137 of the carrying value of the center's land and building. Impairment
loss also consists of a write-off of the unamortized computer software costs of
$217,236. We ceased using the software program in the third quarter of 2001.

                                                                            F-13
--------------------------------------------------------------------------------

<PAGE>


ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

DEFERRED LOAN COSTS - Deferred loan costs represent legal fees, commissions,
accounting and other costs incurred in private fundings. Debt issuance costs are
amortized to interest expense on a straight-line basis over the term of the
related debt.

OTHER ASSETS - Other assets include primarily other intangible assets (mostly
purchased software) that are being amortized over the estimated lives of the
assets and our investment in a partnership accounted for under the equity method
of accounting (see Note 11).

MINORITY INTEREST - The minority interest represents the minority percentage
ownership in the net assets of two subsidiaries.

REVENUES - Net Patient Revenues are recorded at the estimated net realizable
amounts due from patients, third-party payors and others when services are
rendered. Contractual and bad debt adjustments amounted to approximately
$61,032,000, $47,654,000 and $46,989,000 for the years ended December 31,
2001, 2000 and 1999, respectively. These adjustments are recorded on an
estimated basis in the period the related services are rendered and adjusted in
future periods as actual payments are received.

Other revenue includes fees for management, billing and collection, and
marketing services provided to operations under joint venture agreements which
are recorded when services are rendered.

STOCK OPTIONS ISSUED TO EMPLOYEES - We adopted SFAS No. 123, "Accounting for
Stock-Based Compensation," for financial note disclosure purposes and continue
to apply the intrinsic value method of Accounting Principles Board ("APB")
Opinion No. 25, "Accounting for Stock Issued to Employees," for financial
reporting purposes.

INCOME TAXES - Deferred taxes arise primarily from the recognition of revenues
and expenses in different periods for income tax and financial reporting
purposes. Deferred tax liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing liabilities and their respective tax bases.
Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be settled. The effect on deferred tax liabilities
of a change in tax rates is recognized in income in the period that includes the
enactment date.

RECLASSIFICATIONS ( Certain amounts in the 2000 and 1999 financial statements
have been reclassified to conform with the 2001 presentation.

F-14
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

USE OF ESTIMATES IN THE PREPARATION OF FINANCIAL STATEMENTS - The preparation of
financial statements in conformity with accounting principles generally accepted
in the United States of America requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates. The most
significant estimates relate to contractual and bad debt allowances on accounts
receivable, useful lives on medical equipment and the valuation of long-lived
and intangible assets. In addition, healthcare industry reforms and
reimbursement practices will continue to impact the Company's operations and the
determination of contractual and other allowance estimates.

FINANCIAL INSTRUMENTS - The carrying amounts of financial instruments, including
cash and cash equivalents, accounts receivable and accounts payable approximated
fair value as of December 31, 2001 and 2000 because of the relative short
maturity of these instruments. The carrying value of lines of credit
approximated fair value at December 31, 2001 and 2000 based upon quoted market
interest rates for the same or similar instruments under which the Company can
borrow funds. OnCure has approximately $9.5 million in fixed rate term debt with
interest rates between 10% and 13% at December 31, 2001. We believe based upon
our recent borrowing experience that the current market rates available for
similar instruments under similar terms would be between 8% and 10%. However, we
do not believe it is practicable to estimate the fair value of each of these
instruments because the actual rates available to us would depend on various
facts and circumstances of each instrument and costs incurred to measure this
would be excessive.

LOSS PER SHARE - The shares issued in connection with the Company's
reorganization are shown as outstanding for all periods presented in the same
manner as for a stock split. Basic earnings per share represents the amount of
earnings for the period available to each share of common stock outstanding
during the reporting period. Diluted earnings per share reflects the amount of
earnings for the period available to each share of common stock outstanding
during the reporting period, while giving effect to all dilutive potential
common shares that were outstanding during the period, such as common shares
that could result from the potential exercise or conversion of securities into
common stock. The computation of diluted earnings per share does not assume
conversion, exercise or contingent issuance of securities that would have an
antidilutive effect on earnings per share. Loss attributable to common
stockholders reflects an addition to net loss resulting from 1) preferred stock
dividends declared and paid and cumulative preferred stock dividends and 2) the
imputed non-cash preferred stock dividends arising from the amortization of the
discounts on preferred stock.

In October 2000, OnCure approved a one-for-fifty reverse stock split of the
Company's common stock effective November 10, 2000. All share and per share data
presented reflects the effect of the reverse stock split.

                                                                            F-15
--------------------------------------------------------------------------------

<PAGE>


ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 2 - SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

CONCENTRATIONS OF CREDIT RISK - OnCure maintains cash balances at financial
institutions that periodically exceed the Federal Deposit Insurance Corporation
limit of $100,000. We are also subject to credit risk on accounts receivable. We
do not require collateral to support accounts receivable or financial
instruments subject to credit risk. Losses on accounts receivable have been
within management's expectations.

SEGMENT INFORMATION - We have determined that OnCure conducts operations in one
business segment. For all periods presented, substantially all revenue has been
derived within the United States. Long lived assets are principally located in
the United States.

RECENT ACCOUNTING PRONOUNCEMENTS - In April 2000, the Financial Accounting
Standards Board issued FASB Interpretation No. 44 ("FIN 44"), "Accounting for
Certain Transactions Involving Stock Compensation," an interpretation of APB
Opinion No. 25. FIN 44 is effective for transactions occurring after July 1,
2000. The application of FIN 44 did not have a material impact on the Company's
financial position or results of operations.

In December 1999, the SEC issued Staff Accounting Bulletin No. 101 ("SAB 101"),
"Revenue Recognition in Financial Statements." SAB 101 summarizes the SEC's view
in applying generally accepted accounting principles to selected revenue
recognition issues. The application of the guidance in SAB 101 was required in
the Company's fourth quarter of fiscal year 2000. The adoption of SAB 101 did
not have a material impact on the Company's financial position or results of
operations.

In July 2001, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards (SFAS) No. 141, "Business Combinations," and
SFAS No. 142, "Goodwill and Other Intangible Assets." According to the
significant provisions of these two pronouncements, acquirers in a business
combination must allocate portions of the purchase price to specifically
identifiable intangible assets. Examples of such identifiable intangible assets
include trademarks and tradenames, customer lists, licensing, royalty or
standstill agreements, construction permits, franchise agreements, employment
contracts, patented and unpatented technology, and computer software. Beginning
in the first quarter of fiscal year 2002, we will no longer amortize goodwill
and identifiable intangible assets determined to have an indefinite useful life,
but will perform impairment tests annually, or earlier if indicators of
potential impairment exist. All other intangible assets determined to have
finite useful lives will continue to be amortized over their estimated useful
lives. In conjunction with the implementation of SFAS No. 142, we have completed
a goodwill impairment review as of the beginning of fiscal 2002 using a
fair-value based approach in accordance with provisions of that standard and
found no impairment. Application of the goodwill non-amortization provisions is
expected to result in a decrease in amortization of approximately $900,000 for
fiscal year 2002. We have reviewed the components of previous business
combinations for which separate accounting records have been maintained and have
not found any significant separately identifiable intangible assets included in
goodwill that should be reported separately based on the provisions of SFAS No.
142.

F-16
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 3 - MERGERS AND ACQUISITIONS

On March 19, 1999, USCC acquired substantially all of the assets of an oncology
center in Corpus Christi, Texas ("Corpus"). In the transaction, accounted for as
a purchase, USCC paid $5 million, by assuming $5 million of debt owed by the
seller to DVI Financial Services, Inc. ("DVI"). Simultaneous with the
acquisition, the DVI debt was refinanced through the issuance of a $2 million,
9%, ten year loan secured by Corpus' equipment, a $500,000, 9%, twenty year loan
secured by Corpus real estate, and $2.5 million of Series B preferred stock
(converted to common stock in 2001). The operating results of Corpus are
included in the consolidated financial statements beginning on March 19, 1999.

The following unaudited pro forma summary information presents the consolidated
results of operations of the Company as if the above business combination had
occurred on January 1, 1999. Revenue and net loss for the year ended December
31, 1999 is as follows:


                    Revenue             $17,049,369
                    Net Loss            $  (951,661)


On January 12, 2001, we merged with Florida Cancer Center - Beaches, P.A., a
Florida professional association ("Beaches"). The transaction was accounted for
under the purchase method of accounting for business combinations. The Company
is the surviving entity and is considered the purchaser in this transaction. We
acquired Beaches, with identifiable assets and liabilities having an aggregate
fair value of $1,559,033, in exchange for issuance of 1,000 shares of Series D
preferred stock with a par value of $2,500 per share (Note 8) to the owners of
Beaches. Excess cost over fair value of net assets acquired of $940,967 is
recorded as an asset in the financial statements. The operating results of
Beaches for the year ended December 31, 2001 are included in the consolidated
financial statements.

                                                                            F-17
--------------------------------------------------------------------------------

<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 4 - PROPERTY AND EQUIPMENT

Property and equipment consists of the following:

<TABLE>
<CAPTION>
                                                                     DECEMBER 31,
                                                              --------------------------------
                                                                   2001              2000
                                                              -------------     --------------
<S>                                                           <C>               <C>
 Land                                                         $   1,335,000     $    1,335,000
 Building                                                         2,683,073          3,100,545
 Furniture and fixtures                                             789,300            767,897
 Medical equipment                                               13,359,932         10,276,791
 Leasehold improvements                                           2,077,140          2,055,506
                                                              -------------     --------------
 Total, at cost                                                  20,244,445         17,535,739
 Less: accumulated depreciation                                  (4,732,295)        (2,690,262)
                                                              -------------     --------------
 Property and equipment, net                                  $  15,512,150     $   14,845,477
                                                              =============     ==============
</TABLE>

NOTE 5 - INTANGIBLES AND OTHER ASSETS

Intangible assets consist of the following:

<TABLE>
<CAPTION>
                                                         DECEMBER 31, 2001
                                     ---------------------------------------------------------
                                     Estimated                   Accumulated
                                       Life           Cost       Amortization         Net
                                     ----------   -------------  -------------   -------------
<S>                                   <C>         <C>            <C>             <C>
 Excess of cost over fair value
    of net assets acquired            20 years    $  15,771,153  $   2,512,641   $  13,258,512
 Investment in partnership
    (Note 11)                           N/A             465,895              -         465,895
                                                  -------------  -------------   -------------
 Totals                                           $  16,237,048  $   2,512,641   $  13,724,407
                                                  =============  =============   =============
</TABLE>

F-18
--------------------------------------------------------------------------------

<PAGE>


                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 5 - INTANGIBLES AND OTHER ASSETS (CONTINUED)

<TABLE>
<CAPTION>
                                                            DECEMBER 31, 2000
                                            --------------------------------------------------------------
                                             Estimated                       Accumulated
                                               Life          Cost            Amortization        Net
                                            ------------   -------------   ----------------  -------------
<S>                                         <C>           <C>                 <C>              <C>
Excess of cost over fair value
    of net assets acquired                   20 years       $17,376,800    $1,961,505       $15,415,295
Deferred loan costs                         3 - 10 years        693,733       531,656           161,077
Investment in partnership
       (Note 11)                                N/A              33,333             -            33,333
Capital software costs                                          293,315        44,676           248,639
Other intangible assets                     3 - 5 years         249,996        70,354           179,642
                                                            -----------    ----------       -----------
Total                                                       $18,647,177    $2,609,191       $16,037,986
                                                            ===========    ==========       ===========
</TABLE>


Intangibles are amortized on a straight-line basis over the estimated lives of
the assets. Amortization expense amounted to $1,111,368, $1,125,190 and
$1,077,619 for the years ended December 31, 2001, 2000 and 1999, respectively.

Capitalized software costs relate primarily to the development and
implementation of a billing and accounts receivable management software system.
In September 2001, we ceased using this software due to the loss of certain
personnel integral to the facilitation of its maintenance and use. We are
currently using another purchased software product in our billing and accounts
receivable management function. The remaining unamortized capitalized costs of
the internally-developed software have been written-off as depreciation expense
in 2001.

NOTE 6 - INDEBTEDNESS

Long-term debt consists of the following:



                                                             DECEMBER 31,
                                                    ----------------------------
                                                        2001            2000
                                                    --------------- ------------
Notes payable, 8.17% to 12.95%, maturing between      $16,686,477    $15,678,807
    2002 and 2009
Merrill Lynch Bank USA line of credit                   1,025,00               -
Notes payable to related parties, 6% to 9%,
   maturing 2006                                                -        877,698
Convertible promissory notes to two directors of the
   Company, 6% maturing 2001                                    -      1,483,488
Convertible promissory notes, 10%, maturing 2001                -        150,000
                                                    --------------- ------------
Total                                                  17,711,477     18,189,993
Less: current maturities                                3,785,184      4,987,316
                                                    --------------- ------------
                                                      $13,926,293    $13,202,677
                                                    =============== ============
                                                                            F-19
--------------------------------------------------------------------------------

<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 6 - INDEBTEDNESS (CONTINUED)

As of December 31, 2001, the maturities of notes payable and convertible
promissory notes are as follows:


Years ending
December 31,
--------------

2002                  $ 3,785,184
2003                    4,339,123
2004                    3,113,749
2005                    2,541,667
2006                    3,151,419
Thereafter                780,335
                      -----------
Total                 $17,711,477
                      ===========


At December 31, 2001, we had twenty-eight long-term notes payable totaling
approximately $12,970,814 to DVI Financial Services, Inc. ("DVI"), the
beneficial owner of more than 5% of our voting securities and holder of our
Series C Preferred Stock, and approximately $3,715,663 in notes payable with
other equipment financing companies. Substantially all of our receivables,
equipment and certain tangible assets collateralize the notes payable. Interest
is charged at annual rates ranging from 8.17% to 12.95%, and the notes mature
through 2009.

At December 31, 2001, we had several lines of credit with DVI for a maximum
borrowing base of $4,450,000. Borrowings under each line of credit are
collateralized by accounts receivable of several treatment centers and are
limited to eighty-five percent (85%) of eligible accounts receivable, as defined
in the borrowing agreement. At December 31, 2001, the Company had borrowings of
$3,759,177 outstanding under the line of credit agreements. Borrowing under the
line of credit agreements are subject to interest ranging from prime plus 2% to
prime plus 2.25%. At December 31, 2001, the interest rate under the agreements
ranged from 6.84% to 7.09%. According to amendments to the lines of credit we
completed with DVI on December 27, 2001, the lines of credit do not expire and
are not due until June 2004. However, because the terms of the agreements
require the maintenance of lockboxes whereby accounts receivable remittances pay
down the lines of credit directly and contain a subjective acceleration clause,
we have classified the balances on the lines of credit as current in accordance
with Emerging Issues Task Force (EITF) abstract 95-22 "Balance Sheet
Classification of Borrowings Outstanding under Revolving Credit Agreements That
Include both a Subjective Acceleration Clause and Lock-Box Arrangement."

F-20
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------



NOTE 6 - INDEBTEDNESS (CONTINUED)

In March 2001, we obtained a line of credit with Merrill Lynch Bank USA. The
maximum borrowing base under the line of credit is $2,800,000. A security
deposit sufficient to support the outstanding principal amount secures
borrowings under the line of credit. At December 31, 2001, we had borrowings in
the amount of $1,025,000. Interest under the line of credit is the three-month
LIBOR rate (adjusted weekly) plus 1.39%, (3.27% at December 31, 2001). The term
of the loan is five years with periodic monthly payments of interest only and a
balloon payment of interest and principal at the end of the term.

We have a note payable to the Chairman of the Board and minority stockholder of
the Company with a balance of $103,482 and $123,511 at December 31, 2001 and
2000, respectively, which bears interest at 9%, is due in monthly payments
through 2006, and is secured by a second mortgage on the related property.

In December 1998, we purchased $735,000 of medical equipment from a company
owned by a former director of the Company and we issued a $735,000 promissory
note to the director's company. The note had an outstanding balance of $586,187
at December 31, 2000, bears interest at 6% per annum, and was due in March 2006.
This note has been contingently exchanged for common stock at December 31, 2001
(see Note 8).

In September 2000, OnCure issued a $189,000 note payable to a director of the
Company in exchange for a forfeiture of contingent shares. The note was
non-interest bearing and was payable in 36 monthly installments of $5,250
through September 2003. The note was paid in full during 2001.

At December 31, 2000, OnCure had $1,483,488 of convertible promissory notes to
two individuals who were directors and minority stockholders in the Company.
These notes were assumed under a merger agreement and bear interest at 6%, were
due in March 2001, and were convertible at the option of the holder to common
stock at a conversion rate equal to the fair market value at date of issuance of
$2.00 per share. We recorded interest expense of approximately $89,000 in each
of the years ended December 31, 2000 and 1999 related to these convertible
promissory notes. The notes accelerated if certain specified equity financings
were achieved, and were collateralized by a pledge by the CEO of the Company of
his one million shares of common stock of the Company. In January 2001,
simultaneous with the closing of the reorganization agreement, we completed
institutional funding and debt restructuring of $4,000,000 through a Series E
preferred stock investment, with a conversion price of $1.30 per share and
$1,500,000 of secured debt. From the gross funds of $5,500,000, we repaid
$1,515,281 of convertible promissory notes payable (including accrued interest)
and $470,000 of investment banking and legal fees.

                                                                            F-21
--------------------------------------------------------------------------------

<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 6 - INDEBTEDNESS (CONTINUED)

On May 25, 1998, we issued $3.2 million of convertible promissory notes in a
private placement to finance the acquisitions under a merger agreement. The
notes bear interest at 10%, were unsecured, and were due in May 2001. The notes
were convertible into common stock at a rate of $2.50 per share at the option of
the holder anytime during the three year period ended May 25, 2001. The holders
also received warrants for the purchase of 640,000 shares of common stock at an
exercise price of $2.00 per share. Costs associated with the debt issuance of
$605,496 were capitalized and were being amortized to interest expense over the
lesser of the three-year term of the debt or date of conversion. In December
2000, $3,050,000 of these notes were converted to common stock. Of the
$3,050,000 converted, several note holders with total debt of $1,225,000 can
exercise an option to have 612,500 shares repurchased by the Company at $2.00
per share (see Note 8). The remaining $150,000 was paid in full in 2001.

NOTE 7 - INCOME TAXES

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

                                                       DECEMBER 31,
                                        ---------------------------------------
                                           2001           2000           1999
                                        ---------      ---------      ---------
                                                   (As Restated)
                                                   -------------
Current:
    Federal                             $       -      $    -         $(136,145)
    State                                       -           -           (33,805)
                                        ---------      ---------      ---------
        Totals                                  -           -          (169,950)
                                        ---------      ---------      ---------
Deferred
    Federal                              (258,114)      (334,110)        31,812
    State                                 (32,759)       (82,892)       129,263
                                        ---------      ---------      ---------
                                         (290,873)      (417,002)       161,075
                                        ---------      ---------      ---------
        Income tax benefit              $(290,873)     $(417,002)     $  (8,875)
                                        =========      =========      =========

F-22
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
NOTE 7 - INCOME TAXES (CONTINUED)

A reconciliation between reported income tax (benefit) and the amount computed
by applying the statutory Federal income tax rate of 34% is as follows:

<TABLE>
<CAPTION>
                                                             DECEMBER 31,
                                            --------------------------------------------------
                                                 2001              2000               1999
                                            --------------    --------------     -------------
                                                              (As Restated)
<S>                                         <C>               <C>                <C>
    Computed Federal tax (benefit) at 34%   $   (2,535,023)   $     (144,391)    $    (314,705)
    Computed state tax (benefit)                  (534,591)          (33,040)          (72,058)
    Federal tax benefit of state tax               181,761            11,234             24,501
    Other differences                             (430,264)         (250,805)           353,387
    Valuation allowance                          3,027,244                -                  -
                                            --------------    --------------     -------------
    Income benefit                          $     (290,873)   $     (417,002)    $      (8,875)
                                            ==============    ==============     =============
</TABLE>

The Company's deferred tax assets and liabilities are as follows:

<TABLE>
<CAPTION>
                                                                         DECEMBER 31,
                                                              ---------------------------------
                                                                    2001               2000
                                                              --------------     --------------
                                                                                 (As Restated)
<S>                                                           <C>                <C>
 Current deferred tax asset:
    Allowance for doubtful accounts                           $      182,798     $      174,170
    Accrued wages and benefits                                        63,913             46,563
    Net operating loss carryforward                                       -             229,641
 Current deferred tax liability:
    Cash to accrual change                                                -           (160,869)
                                                              --------------     --------------
 Net current deferred tax asset                                      246,711            289,505
                                                              --------------     --------------
 Non-current deferred tax asset:
    Net operating loss carryforward                                3,027,244            498,027
    Valuation allowance                                           (3,027,244)                -
    Intangibles and other assets basis differences                   962,229           (29,953)
 Non-current deferred tax liabilities:
    Fixed asset basis differences                                 (1,208,940)       (1,048,452)
                                                              --------------     --------------
 Net non-current deferred income tax liability                      (246,711)         (580,378)
                                                              --------------     --------------
       Net deferred income tax liability                      $           -      $    (290,873)
                                                              ==============     ==============
</TABLE>

                                                                            F-23
--------------------------------------------------------------------------------

<PAGE>


ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 7 - INCOME TAXES (CONTINUED)

We believe that the realization of the net current deferred tax asset is more
likely than not, based on the expectations that the Company will generate the
necessary taxable income in 2002.

A valuation allowance has been established at December 31, 2001 for the net
operating loss carryforward asset ("NOL carryforward"). The utilization of the
NOL carryforward is uncertain due to our results of operations as described at
Management's Operating Plan at Note 1 and the Company's annual use limitation on
portions of the NOL carryforward.

At December 31, 2001, the Company had unused federal net operating losses of
approximately $10,000,000 expiring from 2014 to 2021. Due to the Company's
reorganization, certain net operating losses are subject to maximum annual
utilization of approximately $181,000.

NOTE 8 - CAPITAL STOCK

OnCure is authorized to issue 100,000,000 shares of $.001 par value common stock
and 1,000,000 shares of $.001 par value preferred stock, of which 1,000 shares
have been designated Series B Preferred Stock (liquidation preference of
$2,500,000), 1,000 shares have been designated Series C Preferred Stock
(liquidation preference of $5,000,000), 1,000 shares have been designated Series
D Preferred Stock (liquidation preference of $2,500,000) and 1,000 shares have
been designated Series E Preferred (liquidation preference of $4,000,000).

REDEEMABLE PREFERRED STOCK - In conjunction with the financing of the
acquisition of the Corpus Christi center, the Company issued to DVI 1,000 shares
of Series B Preferred Stock. The Series B Preferred Stock was convertible into
common stock at a conversion rate calculated by dividing $2,500 by an amount
equal to 90% of the average fair market value of the Company's common stock for
the 20 days prior to the date of conversion, subject to certain limitations. It
was redeemable at the option of the Company at a price equal to $2,500 per
share, plus all accrued and unpaid dividends. Dividends were cumulative and were
payable quarterly at an annual rate of 5% when and as declared by the Board of
Directors. These shares were redeemable at the option of the holder if the
Corpus Christi center achieved certain financial performance objectives (the
"EBITDA Threshold"). Due to this redemption feature, the Series B Preferred
Stock was accounted for as Redeemable Preferred Stock at December 31, 2000 at
its aggregate liquidation value.

F-24
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 8 - CAPITAL STOCK (CONTINUED)

In September 2001, we entered into an exchange agreement with DVI whereby DVI
exchanged 1,000 shares of Series B Preferred Stock (together with all accrued
and unpaid dividends on the Series B Preferred Stock for an aggregate value of
$2,809,250) for 1,337,738 shares of common stock, a conversion rate of $2.10 per
common share. Common stock was increased $1,337 and the remaining $2,807,913 was
recorded as additional paid-in capital.

PREFERRED STOCK ( The Series C Preferred Stock is convertible into common stock
at a conversion rate calculated by dividing $5,000 by an amount equal to 90% of
the average fair market value of the Company's common stock for the 20 days
prior to the date of conversion. It is redeemable at the option of the Company
at a price equal to $5,000 per share plus all accrued and unpaid dividends.
Dividends are cumulative and are payable quarterly at an annual rate of 9% of
$5,000 per share when and as declared by the Board of Directors. The dividend
rate increases to 20% in March 2002 if the Series C Preferred Stock is
outstanding at such time. The Company has cumulative, unpaid dividends of
$1,260,000 and $810,000 as of December 31, 2001 and 2000, respectively. In
September 2000, an agreement was entered into by the Series C Preferred Stock
holders, an investment banker and the Company whereby the Series C Preferred
Stock will convert into common stock at a conversion price of $4.00 per share,
subject to certain conditions being met as defined in the agreement, and such
common stock will be purchased by the investment banker from the Series C
Preferred stockholder. In September 2001, the holder of the Series C Preferred
stock, DVI, agreed not to exercise its right to convert its shares of the Series
C Preferred stock to common stock until September 7, 2002.

All accrued dividends at the date of conversion can be paid in kind with the
Company's common stock in lieu of cash if mutually agreed-upon by the Series C
Preferred stockholder and the Company. The Series C Preferred Stock has a
liquidation preference of $5,000 per share plus all accrued and unpaid
dividends. The Series C Preferred Stock had $1,260,000 and $810,000 in
cumulative, undeclared and unpaid dividends at December 31, 2001 and 2000,
respectively.

The Series D Preferred Stock is convertible into common stock at a conversion
rate of $1.30 per share. It is redeemable at the option of the Company at a
price equal to $2,500 per share plus all accrued and unpaid dividends. Dividends
are cumulative and are payable quarterly at an annual rate of 12% when and as
declared by the Board of Directors. The Company declared and paid $300,000 in
dividends in 2001 on the Series D Preferred Stock and accordingly has no
cumulative, unpaid dividends as of December 31, 2001 on the Series D Preferred
Stock.

All accrued dividends at the date of conversion can be paid in kind with the
Company's common stock in lieu of cash if mutually agreed-upon by the Series D
Preferred stockholder and the Company. The Series D Preferred Stock has a
liquidation preference of $2,500 per share plus cumulative unpaid dividends.

                                                                            F-25
--------------------------------------------------------------------------------

<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 8 - CAPITAL STOCK (CONTINUED)

The Series E Preferred Stock is convertible into common stock at a conversion
rate of $1.30 per share ("initial conversion price") through January 2002. At
that date, if the Series E Preferred Stock has not been otherwise converted, the
stock may be converted at the option of the holder at the lesser of the initial
conversion price or a conversion rate calculated by dividing $4,000 by an amount
equal to 90% of the average fair market value of the Company's common stock for
the 20 days prior to the date of conversion. The Series E Preferred Stock is
redeemable at the option of the Company at a price equal to 100% of the Series E
stock issue price plus all accrued and unpaid dividends upon 30 days notice to
the holders. The holders shall be able to exercise their conversion rights
described above prior to the date of redemption. The Series E Preferred Stock
does not provide for any cumulative or preferential dividends. The Series E
Preferred Stock has a liquidation preference of $4,000 per share plus all
accrued and unpaid dividends.

COMMON STOCK - CONTINGENT - At December 31, 2000, we issued 612,500 shares of
common stock in exchange for the retirement of $1,225,000 in debt. The shares
are considered contingent because the holders, based on amended agreements as of
December 28, 2001, have the right to put these shares to the Company at $2.00
per share plus accrued interest at 10% of the aggregate original share exchange
amount of $1,225,000. The put options are exercisable for a twelve-month period,
commencing on February 1, 2002 and ending on January 31, 2003. Each month during
this twelve-month period, these stockholders may elect to hold or to require us
to purchase one twelfth of their holdings. During 2001, 315,000 shares were put
to us at an aggregate redemption price of $630,000, of which $295,000 has been
accrued at December 31, 2001. Interest on all shares has been paid or accrued
through December 31, 2001.

On October 15, 1998, we issued 790,000 shares of our common stock as partial
consideration for an acquisition. In conjunction with this transaction, we
entered into an agreement to repurchase all such stock at a price of $3.00 per
share (an aggregate $2,370,000) at the option of the holders exercisable during
the period October 15, 2000 through October 15, 2003. In conjunction with the
reorganization of the Company described at Note 1, we obtained a permanent
waiver of the put options related to these shares and they have been presented
as common stock at December 31, 2000.

During 2001, the Company entered into an agreement with a former officer and
director and current creditor of the Company ("creditor"), and another equity
investor ("investor"). According to the terms of the agreement, the creditor
contingently exchanged the $586,186 balance on a note payable from the Company
and the claim to additional expenses in the amount of $130,150 for 358,168
shares of common stock at a value of $2.00 per share ($716,366). The exchange is
contingent upon the investor calling the shares of stock from the creditor at
$2.25 per share by November 10, 2002. The note is currently being held in escrow
and should the investor not exercise their call option by the specified date,
the note would be reinstated along with the additional expenses and be due upon
60 days notice. The common stock has been accounted for as common stock -
contingent at the liquidating value of the stock, $716,336.

F-26
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 8 - CAPITAL STOCK (CONTINUED)

CONTINGENT SHARES - MINORITY SHAREHOLDERS - Pursuant to a merger agreement dated
May 22, 1998, certain minority shareholders were to receive contingent shares
based upon a formula of certain number of shares divided by a required amount of
equity or unsecured debt. The Series B Preferred Stock investment of $2.5
million by DVI would have qualified for such contingent share requirement,
however, it was subject to the Corpus EBITDA Threshold (see "REDEEMABLE
PREFERRED STOCK"). Accordingly, the Company would have been required in the
future to issue to the minority shareholders 416,667 shares if the EBITDA
Threshold was attained and the Series B Preferred Stock was put to the Company.
In April 2000, the Company and the minority shareholders executed an Addendum to
the Agreement of Merger, whereby, if the EBITDA Threshold was achieved, and DVI
put the Series B Preferred Stock to the Company in exchange for secured debt,
then the minority shareholders rights under the original Agreement of Merger
would have been in effect and they would have been issued the 416,667 shares. In
December 2000, the right to the contingent shares was terminated by the minority
shareholders in conjunction with the merger. In exchange, 690,000 options issued
to the minority shareholders under the Company's Incentive Stock Option plan
were repriced to an exercise price of $.01 per common share and the exercise
period was extended through November 2010. At the time of the change in exercise
price, the Company recorded non-cash compensation of $1,373,000 based upon the
fair market value of the Company's common stock of $2.00 per share (see Note 9).

NOTE 9 - STOCK OPTION PLANS

In November 2001, OnCure established the 2001 Stock Option Plan (the Plan)
pursuant to which the Company may issue to officers, directors, key employees
and consultants of the Company options to purchase shares of common stock. The
Plan provides for the issuance of incentive stock options ("ISO"), non-qualified
stock options ("NSO") and stock appreciation rights ("SARs"). Under terms of the
Plan, a maximum of 3,000,000 shares of the Company's common stock may be issued
upon the exercise of stock options granted thereunder. The maximum number of
shares of common stock that may be granted as options or SARs to any participant
in any calendar year shall not exceed 450,000 shares. The Board of Directors (or
a committee of the Board of Directors) is responsible for administering the
Plan. The Board determines to whom grants are made, the vesting, timing, amounts
and other terms of such grants. ISO's may be granted to participants who are key
employees, while NSO's may be granted to the officers, directors and
consultants. SARs may be granted in conjunction with all or part of any option
granted under the Plan. In the case of an NSO, such rights may be granted either
at or after the time of the grant of such option. In the case of an ISO, such
rights may be granted only at the time of the grant of such option. The exercise
price of an ISO may not be less than the fair market value of the Company's
common stock on the date of the grant (110% of such fair market value in the
case of 10% stockholders) and the term of these options may not exceed 10 years
(five years in the case of 10% stockholders). Options generally vest in five
years and expire in five to ten years. For the year ended December 31, 2001,
431,000 options were issued under the Plan.

                                                                            F-27
--------------------------------------------------------------------------------

<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 9 - STOCK OPTION PLANS (CONTINUED)

In March 2001, the Board adopted a policy pursuant to which non-employee
directors shall receive an option under the Plan to purchase 1,000 shares of
common stock with an exercise price of $2.00 per share for every Board meeting
attended and/or committee meeting attended in person or by telephone for the
year ended December 31, 2001. The Company issued 61,000 stock options relating
to this policy. In addition, the Board granted 185,000 stock options to
directors for services rendered. There was no compensation expense recognized
related to these options in accordance with APB Opinion No. 25.

During the period ended December 31, 2001, the Board of Directors granted
185,000 stock options to Company employees.

In connection with the Company's reorganization, 200,000 options were granted to
a former officer at $.01 per share. These options were granted in lieu of cash
owed for prior services performed as an officer.

In May 1998, the Company established the 1998 Stock Option Plan (the "Option
Plan") pursuant to which the Company may issue to officers, directors and key
employees options to purchase up to 2,000,000 shares of common stock. The Option
Plan provides for the issuance of incentive stock options and non-qualified
stock options. Under the terms of the Option Plan, a maximum of 2,000,000 shares
of common stock may be issued upon the exercise of stock options granted
thereunder. The Option Plan is administered by the Company's Board of Directors
(or a committee of the Board of Directors) which determines to whom grants are
made and the vesting, timing, amounts and other terms of such grants. Incentive
stock options may be granted only to Company employees, while non-qualified
stock options may be granted to employees, officers, directors, consultants and
advisors. The exercise price of incentive stock options may not be less than the
fair market value of the Company's stock on the date of grant (110% in the case
of 10% stockholders) and the term of these options may not exceed 10 years (five
years in the case of 10% stockholders). Options generally vest from three to
five years, and expire in five or ten years. For the year ended December 31,
2000, the Company issued 410,000 options under the option plan.

In October 1998, the Company adopted a policy pursuant to which non-employee
directors shall receive an option under the Option Plan to purchase 1,000 shares
of common stock with an exercise price equal to the fair market value at the
time for every Board meeting attended in person or by telephone from that date
forward. For the years ended December 31, 2000 and 1999, the Company issued
14,000 and 35,000 stock options, respectively. Compensation expense related to
options issued to non-employee directors was not material to the consolidated
financial statements.

F-28
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------



NOTE 9 - STOCK OPTION PLANS (CONTINUED)

In May 1998, the Company issued options outside of the Option Plan for the
purchase of 300,000 shares of common stock at an exercise price of $.01 per
share to an officer. The option vests the earlier of certain criteria or five
years. We recognized as deferred compensation expense the excess of the fair
value of the common stock issuable upon the exercise of such options over the
aggregate exercise price of such options. The total deferred compensation
expense of $147,000 was being amortized over the vesting period of the option.
In 2001, the officer's employment was terminated and $71,050 was charged to
compensation expense.

In November 2000, the Company reduced the exercise price of stock options held
by two minority shareholders as compensation for services provided by the
minority shareholders. We recorded a non-cash stock option compensation expense
of $1,373,000 for the year ended December 31, 2000 to recognize the difference
between the reduced exercise price and the market price of the Company's stock
at the date of re-pricing. In accordance with FIN #44, the options are treated
as variable stock options subsequent to the date of re-pricing and an adjustment
of $380,134 was recorded during 2001 to recognize a decrease to non-cash stock
option compensation expense for the reduction in the market price of the
Company's stock from the date of re-pricing to the date of exercise, March 2001.

On January 22, 2001, the Company issued stock options outside of the Option Plan
to two Directors of the Company for services rendered in the reorganization of
the Company. The difference between the market price of the Company's stock and
the exercise price of the options, an aggregate $258,700, was recorded as an
increase to non-cash stock option compensation expense in the accompanying 2001
statement of operations.

In June 2001, the Company re-priced warrants issued to previous debt holders of
the Company. The difference between the market price of the Company's stock and
the reduced exercise price of the warrants, an aggregate $178,000, was recorded
as an increase to non-cash stock option compensation expense in the accompanying
2001 statement of operations. The warrants were exercised subsequent to the
re-pricing in June 2001.



                                                                            F-29
--------------------------------------------------------------------------------

<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 9 - STOCK OPTION PLANS (CONTINUED)

A summary of the Company's stock option activity, and related information
follows:

<TABLE>
<CAPTION>
                                                                             Weighted-Average
                                                                 Options      Exercise Price
                                                                 -------      --------------
<S>                                                             <C>             <C>
 Options outstanding
    at December 31, 1999                                        1,469,000       $    1.53
                                                                =========       =========
 Options exercisable
     at December 31, 1999                                         304,000       $    1.14
                                                                =========       =========
 Weighted-Average fair value of options granted
     at December 31, 1999                                         250,000       $    1.12
                                                                =========       =========
 Options outstanding
     at December 31, 1999                                       1,469,000       $    1.53
    Granted                                                       624,000            1.99
    Exercised                                                           -            -
    Forfeited                                                     (91,667)           2.00
                                                                ---------       ---------
 Options outstanding
    at December 31, 2000                                        2,001,333       $    1.52
                                                                =========       =========
 Options exercisable
     at December 31, 2000                                       1,549,666       $    1.30
                                                                =========       =========
 Weighted-Average fair value of options granted
     at December 31, 2000                                         624,000       $    2.00
                                                                =========       =========
 Options outstanding
    at December 31, 2000                                        2,001,333       $    1.52
    Granted                                                       561,000            1.94
    Exercised                                                    (820,000)           0.01
    Forfeited                                                    (472,667)           1.78
                                                                ---------       ---------
 Options outstanding
    at December 31, 2001                                        1,269,666       $    1.46
                                                                =========       =========
 Options exercisable
    at December 31, 2001                                          610,731       $    0.97
                                                                =========       =========
 Weighted- Average fair value of options granted
     at December 31, 2001                                         561,000       $    1.25
                                                                =========       =========
</TABLE>

F-30
--------------------------------------------------------------------------------

<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 9 - STOCK OPTION PLANS (CONTINUED)

<TABLE>
<CAPTION>
                                                       DECEMBER 31, 2001
                               -------------------------------------------------------------------
                                    Options Outstanding                 Options Exercisable
                               -------------------------------   ---------------------------------
                                  Average            Weighted-                         Weighted-
                                 Remaining           Average                            Average
   Range of        Number of    Contractual          Exercise      Number of            Exercise
Exercise Price     Options         Life               Price         Options              Price
--------------    ---------     -----------          --------      ---------           -----------
<S>                 <C>            <C>                <C>           <C>                   <C>
$    0.01           30,000         5.70               $0.01         300,000               $0.01
$    1.00           75,166         2.83               $1.00          32,623               $1.00
$    1.30           50,000         4.71               $1.30           2,623               $1.30
$    2.00          719,500         3.42               $2.00         269,358               $2.00
$    2.50          125,000         4.42               $2.50           5,833               $2.50
</TABLE>



SFAS 123 requires disclosure of pro forma net income as if the Company adopted
the fair value method of accounting. Under SFAS 123, the fair value of
stock-based awards to employees is calculated through the use of option pricing
models, which require subjective assumptions, including future stock price
volatility and expected time to exercise, which greatly affect the calculated
values. The Company's calculations were made using the Black-Scholes option
pricing model with the following weighted average assumptions: expected life, 60
months following vesting; stock volatility, 1.844% in 2001 and .001% in 2000 and
1999; risk free interest rates, approximately 4.12% to 4.86% in 2001 and 6% in
2000 and 1999; and no dividends during the expected terms. The calculation is
based on a multiple option valuation approach and forfeitures are recognized as
they occur. If the computed fair value of the 2001, 2000 and 1999 awards had
been amortized to expense over the vesting period of the awards, pro forma net
loss and net loss per share for 2001, 2000 and 1999 would not change materially
from the amount represented in the accompanying statements of operations.

NOTE 10 - PENSION PLAN

The Company has a 401(k) Pension Plan (the "Plan"). Under the Plan, eligible
employees may make an election to defer any amount up to 20% of their annual
eligible compensation, subject to certain limitations. We make an annual
contribution of 3% of the employee's annual eligible compensation, up to a
maximum of $1,800 per year. Participants' contributions to the Plan vest
immediately and Company contributions are 100% vested after five years of
service (40% per year after two years of service and 20% per year of service
thereafter). Contributions to the Plan totaled approximately $76,000, $43,000
and $54,000 for the years ended December 31, 2001, 2000 and 1999, respectively,
and were charged to operations.

                                                                            F-31
--------------------------------------------------------------------------------

<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 11 - RELATED PARTY TRANSACTIONS

OnCure leases three medical facilities and warehouse space from companies owned
by two former directors of the Company. The warehouse space lease terminated in
September 2001. Rent expense of approximately $434,000, $301,000 and $281,000
for the years ended December 31, 2001, 2000 and 1999 was recorded related to
these facilities.

At December 31, 2000, the Company had a $300,000 unsecured demand loan bearing
interest at 9% payable to a former director of the Company. Interest expense on
this loan amounted to approximately $15,000, $25,000 and $21,000 for the years
ended December 31, 2001, 2000 and 1999, respectively. The note was paid in full
in May 2001.

In September 2001, we entered into an exchange agreement with DVI whereby DVI
exchanged 1,000 shares of its Series B Preferred Stock for 1,337,738 shares of
our common stock (see Note 8). DVI also agreed not to exercise its right to
convert its shares of the Series C Preferred stock to common stock until
September 7, 2002 (see Note 8).

In April 2000, the Company through its USCC subsidiary, entered into a
partnership agreement (USCMC-USCC) with U.S. Cancer Management Corporation, a
corporation wholly-owned by a former member of the Board of Directors ("former
Director"). The partnership's purpose is to develop and build outpatient
radiation therapy centers in Northern California to service patients of a
Northern California based health insurance payor network. Terms of the agreement
provide that all profits are distributed 51% to U.S. Cancer Management
Corporation and 49% to USCC. In addition, the partnership agreement provides
that USCC will be required to provide a total of $300,000 in financing to be
paid, as defined in the agreement, over the first 24 months of partnership
operations or obtain financing for the development of certain centers. If USCC
fails to provide financing its equity interest in the partnership will be
reduced from 49% to 5%. As of December 31, 2001, USCMC-USCC had substantially no
operations. On February 28, 2002, OnCure entered into a settlement agreement
with the former Director providing for, among other things, mutual general
releases of the complaints and cross-complaints filed during 2001 (see Note 13).
According to the terms of the settlement, the former Director would transfer
642,833 shares of common stock to the Company and the Company would relinquish
its interest in the USCC-USCMC partnership. Accordingly, we have reduced the
carrying value of the partnership under the equity method of accounting to equal
the market value of the shares received on the date of the settlement, February
28, 2002. This write-off ($338,065) has been recorded as other expense in the
accompanying 2001 statement of operations.

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<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 11 - RELATED PARTY TRANSACTIONS (CONTINUED)

We lease two of our centers in Florida from entities affiliated with the
Chairman of the Board and a member of the Board of Directors. For the years
ended December 31, 2001, 2000 and 1999, the Company recorded approximately
$221,000, $143,000 and $30,000, respectively, of rent expense related to these
centers.

See Note 6 for additional related party disclosures.

NOTE 12 - MEDICAL SERVICE AGREEMENT

We have a three-year medical service agreement with a Northern California based
health insurance payor network ("Network") effective through March 2004. Terms
of the agreement state that we will provide radiation oncology services at
agreed upon rates through our Hayward and Stockton facilities in exchange for
exclusive patient referrals from the Network. Included in accounts receivable at
December 31, 2001 and 2000 is a net receivable balance of approximately $768,000
and $1,535,000, respectively, due under this agreement.

NOTE 13 - COMMITMENTS AND CONTINGENCIES

OnCure leases certain facilities under various operating leases that expire
through 2007. Certain real estate leases have options to renew for periods from
3 to 15 years.

Future commitments under non-cancelable operating leases as of December 31, 2001
are as follows:


                    2002                               $1,255,081
                    2003                                1,111,003
                    2004                                  983,510
                    2005                                  779,865
                    2006                                  464,339
                    Thereafter                            172,581
                                                       ----------
                           Total                       $4,766,379
                                                       ==========

Rent expense was approximately $1,394,000, $1,086,000 and $672,000 for the years
ended December 31, 2001, 2000 and 1999, respectively.

                                                                            F-33
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<PAGE>
ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 13 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

Periodically, we are a party to claims, suits, or complaints relating to
services and products provided by the Company or physicians with whom we
contract for services. We maintain insurance coverage that we believe is
adequate both as to covered risks and amounts. In addition, pursuant to the
service agreements, the affiliated physician groups are required to maintain
comprehensive professional liability insurance. Successful malpractice claims
asserted against the affiliated physicians or the Company could, however, have a
material adverse effect.

On October 23, 2001, United States Cancer Care, Inc., a wholly-owned subsidiary
of the Company, filed a complaint in the Superior Court of Alameda, California
against a former officer and director and current creditor ("creditor"), another
former officer and director, and three entities affiliated with these
individuals. The defendants filed several cross-complaints against the Company
on or about December 7, 2001 in response to the complaint.

Material monetary damages pursued in the remaining cross-complaints by the
creditor and affiliated entity against the Company include:

     o    Unspecified monetary damages for slander and libel

     o    Compensatory damages of $500,000 for breach of contract

     o    Unspecified compensatory damages for property damage

It is too early in the process to make an estimate of the likelihood of an
unfavorable outcome of the litigation and, due to the unspecified monetary
nature of the cross-complaints, no estimate of potential losses is currently
available. However, we believe that the ultimate resolution of the remaining
complaints and cross-complaints will not have a materially adverse effect on the
Company's financial position or results from operations.

On February 28, 2002, we entered into a settlement agreement and mutual general
releases of the complaints and cross-complaints filed with one of the
individuals and two affiliated entities. The settlement terms are discussed in
detail at Note 11.

OnCure has an employment agreement with a member of management. The agreement
has a term expiring May 2005. As of December 31, 2001, we were required to
provide the following minimum annual base salaries and bonuses, including
minimum annual increases.


                    2002                               $  262,500
                    2003                                  275,625
                    2004                                  289,406
                    2005                                  303,877
                                                       ----------
                           Total                       $1,131,408
                                                       ==========

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                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 13 - COMMITMENTS AND CONTINGENCIES (CONTINUED)

In addition to the above base salary, the employee is entitled to discretionary
bonuses approved by the Compensation Committee of the Board of Directors and a
performance bonus based on raising capital in excess of $3,000,000. OnCure can
terminate the employment agreement without cause but may be required to issue
severance pay.

NOTE 14 - RESTATEMENT

In July 2001, we became aware that the allowance for contractual adjustments was
incorrectly determined. We have determined that the allowance was understated
and revenue was overstated as of and for the year ended December 31, 2000. The
effect of this adjustment is a decrease to pre-tax operating income of $623,810.
We have also determined that adjustments to the deferred tax asset and the
related income tax benefit for the tax effects of the adjustment to the
contractual allowance and the related increase in the net operating loss
carryforward were necessary. The effect of this adjustment increased the
deferred tax asset and the income tax benefit by $217,504.

In addition, in August 2001, we determined that compensation expense was
understated during the year ended December 31, 2000 for the reduction in the
exercise price of 690,000 stock options held by two directors in November 2000
(see Note 9). Under provisions of FIN #44, we recorded an adjustment of
$1,373,000 to pre-tax operating income. Due to the tax law regulations regarding
treatment of stock options, no income tax adjustment has been recorded
pertaining to this adjustment.

Management believes that it has made all of the adjustments considered necessary
to present fairly the Company's consolidated financial position and results of
operations as of and for the year ended December 31, 2000.

The following tables set forth the adjustment made to the Company's previously
issued 2000 consolidated financial statements:

F-35
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<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------
NOTE 14 - RESTATEMENT (CONTINUED)

Consolidated Statement of Operations:

<TABLE>
<CAPTION>
                                    As Previously
                                       Reported         Adjustments         As Restated
                                    --------------   -----------------   -----------------
<S>                                 <C>              <C>                 <C>
 Revenues                           $   20,632,764   $        (623,810)  $      20,008,954
 Operating expenses                     17,482,490          (1,373,000)         18,855,490
 Other expenses                          2,474,151                  -            2,474,151
                                    --------------   -----------------   -----------------
 Income before minority interest
    and income tax benefit                 676,123          (1,996,810)         (1,320,687)
 Minority interest                        (372,366)                 -             (372,366)
 Income tax benefit                        199,498             217,504             417,002
                                    --------------   -----------------   -----------------
 Net income (loss)                  $      503,255   $      (1,779,306)  $      (1,276,051)
                                    ==============   =================   =================

 Net income (loss)                  $      503,255                       $      (1,276,051)
 Deduct: preferred stock dividends       1,133,007                               1,133,007
                                    --------------                       -----------------
 Net (loss) used in per
    common share calculation        $     (629,752)                      $      (2,409,058)
                                    ==============                       =================
 Basic and diluted (loss) per
    common share                    $        (0.08)                      $           (0.30)
                                    ==============                       =================
 Weighted average common shares
    outstanding - basic and diluted      8,024,816                               8,024,816
                                    ==============                       =================
</TABLE>

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<PAGE>

                                      ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------

NOTE 14 - RESTATEMENT (CONTINUED)

<TABLE>
<CAPTION>
                                     As Previously
                                       Reported           Adjustments            As Restated
                                     -------------     -----------------     -----------------
<S>                                  <C>               <C>                   <C>
 Assets:
 Current assets:
    Cash                             $      50,696     $              -      $          50,696
    Accounts receivable - net            5,723,858              (623,810)            5,100,048
    Prepaid expenses and other             335,086                    -                335,086
    Deferred income taxes                   72,001               217,504               289,505
                                     -------------     -----------------     -----------------
       Total current assets              6,181,641              (406,306)            5,775,335

 Property and equipment - net           14,845,477                    -             14,845,477

 Deferred loan costs (net of
    accumulated amortization)              409,716                    -                409,716

 Excess of cost over fair value of net
    assets acquired (net of
    accumulated amortization)           15,415,295                    -             15,415,295

 Other assets - net                        212,975                    -                212,975
                                     -------------     -----------------     -----------------
       Total assets                  $  37,065,104     $        (406,306)    $      36,658,798
                                     =============     =================     =================

 Liabilities and stockholders'equity:
    Current liabilities              $  11,750,742     $              -      $      11,750,742
    Long-term debt                      13,202,677                    -             13,202,677
    Deferred income taxes                  580,378                    -                580,378
                                     -------------     -----------------     -----------------
       Total liabilities                25,533,797                    -             25,533,797
                                     -------------     -----------------     -----------------
 Minority interest                          72,529                    -                 72,529
                                     -------------     -----------------     -----------------
 Commitments                                     -                    -                     -
                                     -------------     -----------------     -----------------
 Common stock - contingent               1,225,000                    -              1,225,000
                                     -------------     -----------------     -----------------
 Redeemable preferred stock              8,535,000                    -              8,535,000
                                     -------------     -----------------     -----------------
 Stockholders'equity:
    Common stock                             7,413                    -                  7,413
    Additional paid-in capital           4,531,238             1,373,000             5,904,238
    Deferred compensation                  (71,050)                   -               (71,050)
    Accumulated deficit                 (2,768,823)           (1,779,306)          (4,548,129)
                                     -------------     -----------------     -----------------
       Total stockholders'equity         1,698,778              (406,306)            1,292,472
                                     -------------     -----------------     -----------------
       Total liabilities and
          stockholders'equity        $  37,065,104     $        (406,306)    $      36,658,798
                                     =============     =================     =================
</TABLE>

                                                                            F-37
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<PAGE>

ONCURE TECHNOLOGIES CORP. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
--------------------------------------------------------------------------------


NOTE 15 - SIGNIFICANT FOURTH QUARTER ADJUSTMENTS

OnCure recorded significant adjustments that increased the net loss in the
fourth quarter of 2001. The primary components of the fourth quarter adjustments
are as follows:

Impairment loss on the Corpus Christi center           $2,676,615
Increase to contractual allowance                         485,500
Write-down of investment in USCC-USCMC partnership        338,065
                                                      ------------
                                                       $3,500,180
                                                      ============


F-38
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