<SEC-DOCUMENT>0000355019-14-000025.txt : 20140916
<SEC-HEADER>0000355019-14-000025.hdr.sgml : 20140916
<ACCEPTANCE-DATETIME>20140916153340
ACCESSION NUMBER:		0000355019-14-000025
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20140630
ITEM INFORMATION:		Results of Operations and Financial Condition
FILED AS OF DATE:		20140916
DATE AS OF CHANGE:		20140916

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			FONAR CORP
		CENTRAL INDEX KEY:			0000355019
		STANDARD INDUSTRIAL CLASSIFICATION:	ELECTROMEDICAL & ELECTROTHERAPEUTIC APPARATUS [3845]
		IRS NUMBER:				112464137
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-10248
		FILM NUMBER:		141105414

	BUSINESS ADDRESS:	
		STREET 1:		110 MARCUS DR
		CITY:			MELVILLE
		STATE:			NY
		ZIP:			11747
		BUSINESS PHONE:		6316942929

	MAIL ADDRESS:	
		STREET 1:		110 MARCUS DRIVE
		CITY:			MELVILLE
		STATE:			NY
		ZIP:			11747
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>fonar_8-k.htm
<DESCRIPTION>FONAR_8-K
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<P STYLE="margin: 0"></P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">SECURITIES AND EXCHANGE COMMISSION</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">Washington, D.C. 20549</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt Courier New, Courier, Monospace; margin: 0; text-align: center"><B>FORM 8-K</B></P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">CURRENT REPORT</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">Pursuant to Section 13 or 15(d) of the Securities
Act of 1934</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">Date of Report (Date of earliest event reported):
September 15, 2014</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt Courier New, Courier, Monospace; margin: 0; text-align: center"><B>FONAR CORPORATION</B></P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">______________________________________________________</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center; text-indent: 0.5in">(Exact name of registrant
as specified in its charter)</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR>
    <TD STYLE="width: 21%; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><FONT STYLE="font-family: Courier New, Courier, Monospace">Delaware</FONT></TD>
    <TD STYLE="vertical-align: top; width: 2%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="width: 50%; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><FONT STYLE="font-family: Courier New, Courier, Monospace">0-10248</FONT></TD>
    <TD STYLE="vertical-align: top; width: 2%; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="width: 25%; border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><FONT STYLE="font-family: Courier New, Courier, Monospace">11-2464137</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">(State or other jurisdiction of incorporation)</P>
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">&nbsp;</P></TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><FONT STYLE="font-family: Courier New, Courier, Monospace">(Commission File Number)</FONT></TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><FONT STYLE="font-family: Courier New, Courier, Monospace">(I.R.S. Employer Identification No.)</FONT></TD></TR>
<TR>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="border-bottom: windowtext 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">110 Marcus Drive</P>
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">Melville, New York 11747</P>
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">(631) 694-2929</P></TD>
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD></TR>
<TR>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">(Address, including zip code, and telephone
        number of registrant's principal executive office)</P>
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">&nbsp;</P></TD>
    <TD STYLE="vertical-align: top; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</TD></TR>
</TABLE>
<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: justify">Check the appropriate box below if the Form
8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions
(see General Instruction A.2. below):</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0 9pt 0 0.5in; text-indent: -0.5in">[ ] Written communications pursuant
to Rule 425 under the Securities Act 17 CFR 230.425)</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0 9pt 0 0.5in; text-indent: -0.5in">[ ] Soliciting material pursuant
to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0 9pt 0 0.5in; text-indent: -0.5in">[ ] Pre-commencement communications
pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0 9pt 0 0.5in; text-indent: -0.5in">[ ] Pre-commencement communications
pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">Item 2.02(a) Results of Operations and Financial Condition.</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: justify">We reported the results of operations
and financial condition of the Company for the fiscal year ended June 30, 2014 in a press release dated September 15,
2014.</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">Exhibits</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-indent: 0.5in">99.1 Press Release dated September 15,
2014</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 6pt; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 6pt; text-align: center"></P>


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<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 6pt; text-align: center">FONAR CORPORATION</P>


<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-align: center">SIGNATURES</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0; text-indent: 0.5in; text-align: justify">Pursuant to the requirements of the Securities
and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly
authorized.</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Times New Roman, Times, Serif; width: 100%; border-collapse: collapse">
<TR STYLE="vertical-align: top">
    <TD STYLE="width: 61%; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD>
    <TD STYLE="width: 39%; padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-family: Courier New, Courier, Monospace">FONAR CORPORATION</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt"><FONT STYLE="font-family: Courier New, Courier, Monospace">(Registrant)</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">By: /s/ Raymond Damadian</P></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 17.1pt"><FONT STYLE="font-family: Courier New, Courier, Monospace">Raymond Damadian</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 17.1pt"><FONT STYLE="font-family: Courier New, Courier, Monospace">President and Chairman</FONT></TD></TR>
<TR STYLE="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">Dated: September 16, 2014</P>
        <P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P></TD>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</TD></TR>
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<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>

<P STYLE="font: 10pt Courier New, Courier, Monospace; margin: 0">&nbsp;</P>



<P STYLE="margin: 0"></P>

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<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>2
<FILENAME>fonar_exhibit-99.htm
<DESCRIPTION>FONAR_EXHIBIT-99
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<P STYLE="margin: 0"></P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0"><FONT STYLE="font: 9pt Sans-Serif; color: Red"><B></B></FONT></P>

<table cellspacing="0" cellpadding="0" style="width: 100%; font: 12pt Arial, Helvetica, Sans-Serif; border-collapse: collapse">
<tr style="vertical-align: top">
    <TD STYLE="width: 34%; border-top: Black 2.25pt solid; padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif"><b><i>NEWS</i></b></font></td>
    <TD STYLE="width: 25%; border-top: Black 2.25pt solid; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <TD STYLE="width: 41%; border-top: Black 2.25pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">FONAR Corporation</td></tr>
<tr style="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">For Immediate Release</font></td>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">The Inventor of MR Scanning&trade;</font></td></tr>
<tr style="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Contact: Daniel Culver</font></td>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">An ISO 9001 Company</font></td></tr>
<tr style="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Director of Communications</font></td>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Melville, New York 11747</font></td></tr>
<tr style="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">E-mail: investor@fonar.com</font></td>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Phone: (631) 694-2929</font></td></tr>
<tr style="vertical-align: top">
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">www.fonar.com</font></td>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <TD STYLE="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Fax: (631) 390-1709</font></td></tr>
</table>
<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 14pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center"><B>FONAR Announces Results For Fiscal 2014</B></P>

<P STYLE="font: 14pt Arial, Helvetica, Sans-Serif; margin: 0"><B>&nbsp;</B></P>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 6pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font: 12pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 12pt Arial, Helvetica, Sans-Serif"><I>39% Increase of Fiscal 2014 Net Revenues
to $68.5 million versus prior year </I></FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 6pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font: 12pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 12pt Arial, Helvetica, Sans-Serif"><I>31% Increase of Fiscal 2014 Net Income
to $13.4 million versus prior year</I></FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 6pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font: 12pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 12pt Arial, Helvetica, Sans-Serif"><I>18% Increase of Fiscal 2014 Diluted Net
Income per Common Share available to Common Shareholders to $1.58 versus prior year</I></FONT></TD></TR></TABLE>

<TABLE CELLPADDING="0" CELLSPACING="0" WIDTH="100%" STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 6pt"><TR STYLE="vertical-align: top">
<TD STYLE="width: 0pt"></TD><TD STYLE="width: 18pt"><FONT STYLE="font: 12pt Symbol">&middot;</FONT></TD><TD STYLE="text-align: justify"><FONT STYLE="font: 12pt Arial, Helvetica, Sans-Serif"><I>63 % Increase of Fiscal 2014 Income from
Operations to $12.3 million versus prior year</I></FONT></TD></TR></TABLE>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: justify"><I>&nbsp;</I></P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">MELVILLE, NEW YORK, September 15, 2014
&ndash; Fonar Corporation (NASDAQ-FONR), The Inventor of MR Scanning&trade;, today announced its 2014 fiscal year-end results.
The Company&rsquo;s two industry segments are: development, manufacturing and servicing of the UPRIGHT&reg; Multi-Position&trade;
MRI and management of Stand-Up&reg; MRI (UPRIGHT&reg; MRI) centers. The FONAR UPRIGHT&reg; Multi-Position&trade; MRI scanner is
the world&rsquo;s only MRI scanner licensed under FONAR&rsquo;s multiple UPRIGHT&reg; MRI patents to scan all the patient&rsquo;s
body parts in their normal full weight-bearing UPRIGHT&reg; position.</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify"><U>Financial Highlights</U></P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">Revenues increased 39% to $68.5 million
for the fiscal year ended June 30, 2014 as compared to $49.1 million for fiscal year ended June 30, 2013.</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">Revenues from the management of the diagnostic
imaging center segment, consisting of patient and management fee revenue, increased 65% to $56.4 million for the year ended June
30, 2014, as compared to $34.3 million over the comparable period one year earlier.</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">Net income increased 31% to $13.4 million
for the fiscal year ended June 30, 2014 as compared to $10.3 million for the earlier corresponding fiscal year.</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">Income from operations increased 63% to
$12.3 million for the fiscal year ended June 30, 2014 from $7.5 million for the fiscal year ended June 30, 2013.</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">Diluted net income available to common
shares for the fiscal year ending June 30, 2014 was $1.58, which includes a partial reversal of the deferred tax valuation allowance
of $2.7 million, or $0.45.</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">Total cash and cash equivalents increased
26% to $10.0 million at June 30, 2014, from $7.9 million at June 30, 2013.</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 6pt; text-align: center">Page 1</P>


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<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 6pt; text-align: center">FONAR CORPORATION</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify"><U>Management Discussion</U></P>

<P STYLE="font: 12pt/15pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">Raymond V. Damadian, M.D., president
and chairman of Fonar Corporation, said, &ldquo;the Company has grown and prospered significantly over the past year as evidenced
by our outstanding financial results. This is in spite of some cuts in MRI reimbursements brought about by the Affordable Care
Act. This is in large part due to the extraordinary abilities of the FONAR UPRIGHT&reg; Multi-Position&trade; MRI, as well as our
fine management staff.&rdquo;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">&ldquo;A year and half have passed since
the acquisition of the business of Health Diagnostics Management (HDM) and we can look back and see how advantageous acquiring
these centers was,&rdquo; continued Dr. Damadian. &ldquo;By combining the resources of our wholly owned subsidiary, Health Management
Corporation of America (HMCA), and HDM, we have seen the benefits of economies of scale, shared technical and administrative expertise
and capabilities, and joint marketing strategies. In the future, we expect to facilitate growth of imaging centers through acquisitions,
supporting new UPRIGHT&reg; imaging centers, and increasing scan volume at our existing locations by continuing to educate the
medical community about the unique diagnostic advantages of UPRIGHT&reg; Multi-Position&trade; fully weight-loaded MRI. The new
HMCA has 23 FONAR weight-bearing MRI scanners and is the largest of its kind in the world.&rdquo;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">&ldquo;Our successful business model is
made possible by the success of our current MRI scanner, the UPRIGHT&reg; Multi Position&trade; (Stand-Up&reg;) MRI,&rdquo; continued
Dr. Damadian. &ldquo;This scanner is extremely popular with patients who experience claustrophobia or can&rsquo;t lie down for
long periods. The FONAR UPRIGHT&reg; MRI provides unduplicated benefits in assessing the position dependence of patient symptoms.
The UPRIGHT&reg; MRI&rsquo;s ability to make MRI motion pictures (cin&eacute;s) of the cerebrospinal fluid (CSF) as it flows into
and out of the upright brain and spine enables visualization of obstructions of CSF flow not found in other MRIs and leading to
new understandings of the genesis of diseases such as multiple sclerosis (MS).</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify"><U>Significant Event</U></P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">On July 17, 2014, the HDM scanning center
in Naples, Florida, won the &lsquo;<I>People&rsquo;s Choice Award</I>&rsquo; after being selected by readers of the Naples Daily
News. Stand-Up MRI of SW Florida was selected for the category of &lsquo;<I>Best Imaging Center&rsquo;</I>. Naples, Florida is
among America&rsquo;s most affluent communities.</P>

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<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 6pt; text-align: center">FONAR CORPORATION</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 6pt; text-align: justify">About FONAR</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: justify">FONAR (NASDAQ:FONR), Melville, NY, The Inventor
of MR Scanning&trade;, was incorporated in 1978, and is the first, oldest and most experienced MRI company in the industry. FONAR
introduced the world&rsquo;s first commercial MRI in 1980, and went public in 1981. Since its inception, nearly 300 recumbent-OPEN
MRIs and 157 UPRIGHT&reg; Multi-Position&trade; MRI scanners have been installed worldwide. FONAR&rsquo;s stellar product is the
UPRIGHT&reg; MRI (also known as the Stand-Up&reg; MRI), the only whole-body MRI that performs Position&trade; imaging (pMRI&trade;)
and scans patients in numerous weight-bearing positions, i.e. standing, sitting, in flexion and extension, as well as the conventional
lie-down position. The FONAR UPRIGHT&reg; MRI often sees the patient&rsquo;s problem that other scanners cannot because they are
lie-down and &rdquo;weightless&rdquo; only scanners. The patient-friendly UPRIGHT&reg; MRI has a near-zero claustrophobic rejection
rate by patients. As a FONAR customer states, &ldquo;If the patient is claustrophobic in this scanner, they&rsquo;ll be claustrophobic
in my parking lot.&rdquo; Approximately 85% of patients are scanned sitting while they watch a 42&rdquo; flat screen TV. FONAR
is headquartered on Long Island, New York.</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.35in 0 0.25in; text-align: justify">UPRIGHT&reg; and STAND-UP&reg;
are registered trademarks and The Inventor of MR Scanning&trade;, Full Range of Motion&trade;, Multi-Position&trade;, Upright Radiology&trade;,
The Proof is in the Picture&trade;, True Flow&trade;,pMRI&trade;, Spondylography&trade;, Landscape&trade;, CSP&trade;, Dynamic&trade;
and Spondylometry&trade; are trademarks of FONAR&reg; Corporation.</P>

<P STYLE="font: 10pt Arial, Helvetica, Sans-Serif; margin: 0 0.35in 0 0.25in; text-indent: 0.25in">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.35in 0 0.25in; text-align: justify">This release may include forward-looking
statements from the Company that may or may not materialize. Additional information on factors that could potentially affect the
Company's financial results may be found in the company's filings with the Securities and Exchange Commission.</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 0; text-align: center">Page 3</P>


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    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.1in 0 0; text-align: center">FONAR CORPORATION</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.1in 0 0; text-align: center">CONSOLIDATED BALANCE SHEETS</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.1in 0 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.1in 0 0; text-align: center"><U>ASSETS</U></P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: justify">&nbsp;</P>

<table cellspacing="0" cellpadding="0" style="font: 12pt Arial, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td colspan="3" style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="font: 12pt Arial, Helvetica, Sans-Serif">June 30,</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="width: 103px; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2014</font></td>
    <td style="width: 16px; border-top: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center">&nbsp;</td>
    <td style="width: 129px; border-top: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2013</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Current Assets:</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 9pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Cash and cash equivalents</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$9,951,736</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$7,870,727</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 9pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Accounts receivable &ndash; net of allowances for doubtful accounts of $257,362 at June 30, 2014 and 2013</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">4,450,125</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">4,443,595</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 9pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Medical receivables &ndash;net of allowances for doubtful accounts of $12,917,751 and $2,584,669 at June 30, 2014 and 2013, respectively </font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">8,807,856</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">8,126,476</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 9pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Management and other fees receivable &ndash; net of allowances for doubtful accounts of $10,901,619 and $9,095,320 at June 30, 2014 and 2013, respectively</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">11,970,388</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">11,465,913</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 9pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Management and other fees receivable &ndash; related medical practices &ndash; net of allowances for doubtful accounts of $403,047 at June 30, 2014 and 2013</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">&nbsp;3,426,982</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2,381,664</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 9pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Costs and estimated earnings in excess of billings on uncompleted contracts</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">759,809</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">445,742</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Inventories</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2,443,536</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2,077,088</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Prepaid expenses and other current assets</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,011,358</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,054,551</font></td></tr>
<tr>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Total Current Assets</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">&nbsp;&nbsp;42,821,790</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">37,865,756</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Deferred Income Tax Asset</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">5,740,287</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2,935,750</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Property and Equipment &ndash; Net</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">15,029,729</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">17,524,494</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Goodwill</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,767,098</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,767,098</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Other Intangible Assets &ndash; Net</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">10,508,843</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">11,904,248</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Other Assets</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">922,096</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,153,304</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Total Assets</font></td>
    <td style="border-bottom: Black 2.25pt double; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$76,789,843</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="border-bottom: Black 2.25pt double; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$73,150,650</font></td></tr>
</table>
<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 0; text-align: center">Page 4</P>


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    <DIV STYLE="page-break-before: always; margin-top: 6pt"><TABLE CELLPADDING="0" CELLSPACING="0" STYLE="width: 100%"><TR><TD STYLE="text-align: center; width: 100%">&nbsp;</TD></TR></TABLE></DIV>
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<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.1in 0 0; text-align: center">FONAR CORPORATION</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.1in 0 0; text-align: center">CONSOLIDATED BALANCE SHEETS</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.1in 0 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.1in 0 0; text-align: center"><U>LIABILITIES</U></P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">&nbsp;</P>

<table cellspacing="0" cellpadding="0" style="font: 12pt Arial, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr>
    <td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td colspan="3" style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="font: 12pt Arial, Helvetica, Sans-Serif">June 30,</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="width: 67%; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="width: 16%; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2014</font></td>
    <td style="width: 2%; border-top: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="width: 15%; border-top: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2013</font></td></tr>
<tr>
    <td style="vertical-align: bottom; padding-right: 5.4pt; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Current Liabilities:</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 17.85pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Current portion of long-term debt and capital leases</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$&nbsp;&nbsp;2,890,816</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$&nbsp;&nbsp;2,885,769</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 17.85pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Accounts payable</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2,481,997</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2,752,479</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 17.85pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Other current liabilities</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">9,024,033</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">8,494,361</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 17.85pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Unearned revenue on service contracts</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">4,730,962</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">4,965,415</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 17.85pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Customer deposits</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,926,813</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,857,870</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 17.85pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Billings in excess of costs and estimated earnings on uncompleted contracts</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">142,217</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">142,217</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 17.85pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Income tax payable</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">-</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">19,501</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-indent: 35.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Total Current Liabilities</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">21,196,838</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">21,117,612</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Long-Term Liabilities:</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Deferred Income Tax Liability</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">583,990</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">461,858</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Due to Related Medical Practices</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">234,581</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">230,626</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Long-Term Debt and Capital Leases, Less Current Portion</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">8,481,830</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">12,887,005</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Other Liabilities</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">386,012</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">654,273</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Total Long-Term Liabilities</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">9,686,413</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">14,233,762</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 8.85pt; text-indent: 27pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Total Liabilities</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">30,883,251</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">35,351,374</font></td></tr>
</table>
<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 0; text-align: center">Page 5</P>


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<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">FONAR CORPORATION</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center"><U>STOCKHOLDERS' EQUITY</U></P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: justify">&nbsp;</P>

<table cellspacing="0" cellpadding="0" style="font: 12pt Arial, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-indent: -4.5pt">&nbsp;</td>
    <td colspan="3" style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 27pt; text-align: center; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">June 30,</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="width: 66%; padding-right: 5.4pt; padding-left: 27pt; text-indent: -4.5pt">&nbsp;</td>
    <td style="width: 16%; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 27pt; text-align: center; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2014</font></td>
    <td style="width: 2%; border-top: Black 1pt solid; padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="width: 16%; border-top: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 27pt; text-align: center; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2013</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Stockholders' Equity:</font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">Class A non-voting preferred stock
        $.0001 par value; 453,000 shares authorized at June 30, 2014 and 2013, 313,438 issued and outstanding at June 30, 2014 and 2013</P></td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$31</font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$31</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">Preferred stock $.001 par value; 567,000
        shares authorized at June 30, 2014 and 2013, issued and outstanding &ndash; none</P></td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">-</font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">-</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">Common stock $.0001 par value; 8,500,000
        shares authorized at June 30, 2014 and 2013, 6,057,483 and 5,980,775 issued at June 30, 2014 and 2013, respectively; 6,045,840
        and 5,969,132 outstanding at June 30, 2014 and 2013, respectively</P></td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">606</font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">598</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">Class B common stock (10 votes per
        share) $.0001 par value; 227,000 shares authorized at June 30, 2014 and 2013, 146 issued and outstanding at June 30, 2014 and 2013</P></td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">-</font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">-</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">Class C common stock (25 votes per
        share) $.0001 par value; 567,000 shares authorized at June 30, 2014 and 2013, 382,513 issued and outstanding at June 30, 2014 and
        2013</P></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.05in 0 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.05in 0 27pt; text-align: right; text-indent: -4.5pt">38</P></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.05in 0 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.05in 0 27pt; text-align: right; text-indent: -4.5pt">38</P></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">Paid-in capital in excess of par value</P></td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">175,284,437</font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">174,499,020</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">Accumulated deficit</P></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(149,259,286)</font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(159,655,416)</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">Notes receivable from employee stockholders</P></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(38,828)</font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(54,820)</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">&nbsp;</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0 0 27pt; text-indent: -4.5pt">Treasury stock, at cost &ndash; 11,643
        shares of common stock at June 30, 2014 and 2013</P></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(675,390)</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(675,390)</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Total Fonar Corporation&rsquo;s Stockholders&rsquo; Equity</font></td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">25,311,608</font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">14,114,061</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Noncontrolling interests</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">20,594,984</font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">23,685,215</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Total Stockholders' Equity</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">45,906,592</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 27pt; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">37,799,276</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Total Liabilities and Stockholders' Equity </font></td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-decoration: underline; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif; text-underline-style: double"><u>$76,789,843</u></font></td>
    <td style="padding-right: 5.4pt; padding-left: 27pt; text-align: right; text-indent: -4.5pt">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 27pt; text-decoration: underline; text-align: right; text-indent: -4.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif; text-underline-style: double"><u>$73,150,650</u></font></td></tr>
</table>
<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: justify">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin-top: 0; margin-bottom: 0; text-align: center">Page 6</P>


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<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">FONAR CORPORATION</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">CONSOLIDATED STATEMENTS OF INCOME</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">&nbsp;</P>

<table cellspacing="0" cellpadding="0" style="font: 12pt Arial, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td colspan="3" style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">For the Years</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">Ended June 30,</P></td></tr>
<tr style="vertical-align: bottom">
    <td style="width: 63%; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td style="width: 18%; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2014</font></td>
    <td style="width: 2%; border-top: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="width: 17%; border-top: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: center"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2013</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Revenues</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Product sales &ndash; net</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$ 1,877,932</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$ 3,939,140</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Service and repair fees &ndash; net</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">10,082,631</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">10,841,935</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Service and repair fees &ndash; related parties &ndash; net</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">110,000</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">110,000</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Patient fee revenue, net of contractual allowances and discounts </font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">24,307,192</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7,481,865</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Provision for bad debts for patient fee </font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(10,333,082)</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(2,584,669)</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Management and other fees &ndash; net</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">34,839,969</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">21,493,599</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-align: justify; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Management and other fees &ndash; related medical&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;practices &ndash; net</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">7,620,835</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">7,859,944</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Total Revenues &ndash; Net</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">68,505,477</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">49,141,814</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Costs and Expenses</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right">&nbsp;</td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Costs related to product sales</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,067,120</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">3,656,635</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Costs related to service and repair fees</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2,496,985</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">3,213,420</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Costs related to service and repair fees &ndash; related parties</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">27,242</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">32,603</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Costs related to patient fee revenue&nbsp;&nbsp;</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">7,670,484</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">&nbsp;&nbsp;&nbsp;2,704,758</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Costs related to management and other fees</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">20,851,065</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">12,998,243</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Costs related to management and other fees &ndash; related medical practices</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">5,134,553</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">3,515,706</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Research and development</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,760,821</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,438,560</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Selling, general and administrative,&nbsp;&nbsp;inclusive of compensatory element of stock issuances of $223,000 and $415,021 for the years ended June 30, 2014 and 2013, respectively</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">15,388,239</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">12,501,621</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 0.25in; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Provision for bad debts</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,806,299</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">1,544,521</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-indent: 0.5in"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Total Costs and Expenses</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">56,202,808</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">41,606,067</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-indent: 31.5pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Income from Operations</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">12,302,669</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">7,535,747</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Other Income and (Expenses):</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Interest expense</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(884,541)</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(500,362)</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Investment income</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">238,928</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">217,598</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Other (expense) income &ndash; net</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(608,599)</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">725,488</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 9pt; text-indent: -9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Income before benefit (provision) for income taxes and noncontrolling interests</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">11,048,457</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">7,978,471</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-indent: 9pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Benefit for Income Taxes</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2,348,312</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">&nbsp;2,277,891</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Net Income</font></td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$13,396,769</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$10,256,362</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Net Income &ndash; Noncontrolling Interests&nbsp;&nbsp;&nbsp;&nbsp;</font></td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(3,000,639)</font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right">&nbsp;</td>
    <td style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">(1,577,820)</font></td></tr>
<tr style="vertical-align: bottom">
    <td style="padding-right: 5.4pt; padding-left: 5.4pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Net Income &ndash; Controlling Interests</font></td>
    <td style="border-bottom: Black 2.25pt double; padding-right: 5.4pt; padding-left: 5.4pt; text-decoration: underline; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif"><u>$ 10,396,130</u></font></td>
    <td style="padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">&nbsp;</font></td>
    <td style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-decoration: underline; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif"><u>$ 8,678,542 </u></font></td></tr>
</table>
<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">Page 7</P>


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<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">FONAR CORPORATION</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0; text-align: center">CONSOLIDATED STATEMENTS OF INCOME (Continued)</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

<P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0">&nbsp;</P>

<table cellspacing="0" cellpadding="0" style="font: 12pt Arial, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap colspan="3" style="border-bottom: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.05in 0 0; text-align: center">For the Years</P>
        <P STYLE="font: 12pt Arial, Helvetica, Sans-Serif; margin: 0 0.05in 0 0; text-align: center">Ended June 30,</P></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="width: 67%; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="width: 16%; border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: center"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2014</font></td>
    <td nowrap style="width: 2%; border-top: Black 1pt solid; padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="width: 15%; border-top: Black 1pt solid; border-bottom: Black 1pt solid; padding-right: 0.05in; padding-left: 5.4pt; text-align: center"><font style="font: 12pt Arial, Helvetica, Sans-Serif">2013</font></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 0.05in; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Net Income Available to Common Stockholders</font></td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$9,720,030</font></td>
    <td nowrap style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$8,107,367</font></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 0.05in; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Net Income Available to Class A Non-Voting Preferred Stockholders</font></td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$503,911</font></td>
    <td nowrap style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$425,708</font></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 0.05in; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Net Income Available to Class C Common Stockholders</font></td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$172,189</font></td>
    <td nowrap style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$145,467</font></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 0.05in; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Basic Net Income Per Common Share Available to Common Stockholders</font></td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$1.62</font></td>
    <td nowrap style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$1.37</font></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 0.05in; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Diluted Net Income Per Common Share Available to Common Stockholders</font></td>
    <td nowrap style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$1.58</font></td>
    <td nowrap style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$1.34</font></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 0.05in; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Basic and Diluted Income Per Share &ndash; Common C</font></td>
    <td nowrap style="border-top: Black 2.25pt double; border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$0.45</font></td>
    <td nowrap style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="border-top: Black 2.25pt double; border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">$0.38</font></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 0.05in; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Weighted Average Basic Shares Outstanding &ndash; Common Stockholder</font></td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">6,009,822</font></td>
    <td nowrap style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">5,933,318</font></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 0.05in; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Weighted Average Diluted Shares Outstanding &ndash; Common Stockholder</font></td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">6,137,326</font></td>
    <td nowrap style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">6,060,822</font></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 0.05in; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Weighted Average Basic Shares Outstanding &ndash; Class C Common</font></td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">382,513</font></td>
    <td nowrap style="padding-right: 0.05in; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 0.05in; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">382,513</font></td></tr>
<tr style="vertical-align: bottom">
    <td nowrap style="padding-right: 5.4pt; padding-left: 8.85pt; text-indent: -8.85pt"><font style="font: 12pt Arial, Helvetica, Sans-Serif">Weighted Average Diluted Shares Outstanding &ndash; Class C Common</font></td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">382,513</font></td>
    <td nowrap style="padding-right: 5.4pt; padding-left: 5.4pt">&nbsp;</td>
    <td nowrap style="border-bottom: Black 2.25pt double; padding-right: 5.4pt; padding-left: 5.4pt; text-align: right"><font style="font: 12pt Arial, Helvetica, Sans-Serif">382,513</font></td></tr>
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