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

                                   FORM 10-KSB

(X)  Annual Report Under Section 13 or 15(d) of the Securities Exchange Act of
     1934

     For the fiscal year ended June 30, 2007

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

Commission file number 0-12962

                            CAMBRIDGE HOLDINGS, LTD.
                            ------------------------
        (Exact name of small business issuer as specified in its charter)

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

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

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


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

Check if disclosure of delinquent filers pursuant to Item 405 of Regulation S-B
is not contained herein, and will not be contained to the best of Registrant's
knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-KSB or any amendment to this
Form 10-KSB. [ ]

The issuer's revenues consisted of $1,493,653 in unrealized and realized gains
on investment securities and $10,625 in interest, dividend and other income.

The aggregate market value of the voting stock held by non-affiliates was
approximately $243,000 on September 5, 2007.

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act) Yes [X] No [_].

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

              Class                          Outstanding at September 17, 2007
  Common Stock, $.025 par value                          3,509,877

Transitional Small Business Disclosure Format   Yes  [_]   No  [X]


<PAGE>
                                     Part I

Item 1.   DESCRIPTION/BUSINESS.

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

In connection with the SEC's regular review of our filings under the Securities
Exchange Act of 1934, we received correspondence from the SEC asking, among
other points, whether we should be registered as an investment company under the
Investment Company Act of 1940. Generally, an issuer is deemed to be an
investment company subject to registration if its holdings of "investment
securities," which usually are securities other than securities issued by
majority owned subsidiaries and government securities, exceed 40% of the value
of its total assets exclusive of government securities and cash items on an
unconsolidated basis.

Immediately following our receipt of correspondence from the SEC, we consulted
with our legal counsel about the Investment Company Act issues raised by the
SEC's letter. Our counsel recommended that we engage special legal counsel with
significant experience related to the Investment Company Act to assist us with
this issue and we did in fact engage such special counsel. Since February 2005,
our management and board have undertaken numerous discussions to investigate and
explore the best course of action. Based upon the investigation undertaken by
our management and board, including work by our legal counsel and special legal
counsel, the Company has determined that the Company has met the definition of
an "investment company" as provided in Section 3(a)(1) of the Investment Company
Act; and accordingly should have been registered and reporting as an investment
company.

During multiple meetings, our board of directors reviewed and discussed the
information that management had gathered. After such discussions, the board on
June 9, 2005, unanimously concluded that the best way to maximize shareholder
value would be to liquidate the Company. Management and the Company's counsel
then developed a plan of liquidation to be completed on an orderly basis to
maximize value to the shareholders that was unanimously approved by the board of
directors on June 9, 2005. At a special meeting of the Company's shareholders
held November 3, 2005, the shareholders approved a plan of liquidation of the
Company and the distribution of substantially all of the Company's cash and
investment assets, in excess of a reasonable operating reserve amount.

We have advised the SEC of our intention to liquidate our assets in order to,
among other factors described below, eliminate the applicability of the
Investment Company Act. In December 2005, a cash dividend of $0.1825 per common
share (approximate total of $651,500) was paid to shareholders of record as of
November 22, 2005. Included in that dividend distribution were approximately
462,500 shares of common stock of A4S and approximately 420,500 shares of common
stock of ANI, with a combined cost basis of approximately $755,500.


                                       2
<PAGE>
In September 2002, the Company completed a pro rata distribution to its
shareholders of 496,296 shares of the AspenBio common stock, which was recorded
by the Company as a dividend at the shares' then estimated fair value of
$150,000. In March 2005, the Company's Board of Directors approved a
distribution of 532,275 shares of the then remaining total AspenBio common stock
owned by the Company at that time. This distribution was made on a pro rata
basis to all shareholders of record as of the close of business on March 24,
2005 and was recorded as a dividend at the shares' estimated value for financial
reporting purposes of approximately $475,000. The Company's Board of Directors
made the decision to distribute this investment based upon the following
considerations; 1) to begin the process of reducing the Company's level of
investment assets, following the SEC's inquiry as to Cambridge's status as not
being in compliance with the reporting requirements under the Investment Company
Act of 1940, and 2) the Board of Directors did not believe that the market value
of the shares of the Company reflected to value of the underlying investments
and therefore to increase the value to its shareholders.

Commencing in December 2001, the Company made a series of investments in
AspenBio Pharma, Inc. ("AspenBio"). In April 2007 the Company exercised warrants
for cash resulting in the issuance of 128,571 AspenBio common shares. The
Company thereupon sold 100,000 AspenBio common shares for approximately $445,000
in cash in order to reduce the level of its investment assets. At June 30, 2007
the Company owned 293,487 common shares of AspenBio. Greg Pusey, president of
the Company, serves as chairman of the AspenBio board of directors and Jeffrey
G. McGonegal, chief financial officer of the Company, serves as AspenBio's chief
financial officer. These exercises of AspenBio warrants were done to maximize
shareholder value, as the warrants were either being redeemed for nominal value
if not then exercised or were scheduled to expire.

Commencing in March 2002, the Company made a series of investments in Security
With Advanced Technology, Inc. ("SWAT"). SWAT, which completed an initial public
offering of its securities in July 2005, develops and markets non-lethal and
personal protection devices and facility and mobile security systems for the
security and surveillance industries, including consumers. The Company currently
owns 6007 common shares and 5,000 publicly tradable warrants in SWAT. Greg
Pusey, president of the Company, serves as chairman of the SWAT board of
directors and Jeffrey G. McGonegal, chief financial officer of the Company,
serves as SWAT's chief financial officer.

Following the 2005 distributions of virtually all of its investment traded
securities and the associated income tax ramifications from those distributions,
the Company had limited cash resources with the remainder of its investments
limited to the warrants and options it had received in earlier years as part of
prior investments and residual shares remaining from the distributions. While
the Company sought a possible combination with another entity the value of the
shares underlying the warrants and options began to rise, with the larger value
AspenBio warrants nearing expiration and the Company determined that the best
course of action was to exercise a portion of its AspenBio warrants for cash to
the extent it was prudent and the balance on a cashless basis as provided in the
terms of the warrants to enhance shareholder value. Approximately $445,000 in
cash was thereupon generated by selling 100,000 of these newly received AspenBio
common shares.

                                       3
<PAGE>
Management of the Company is currently evaluating the most prudent methods and
timing of liquidating the remaining investments held by the Company in AspenBio
and its minor holding in SWAT. The evaluation includes consideration of the
magnitude of each holding as compared to the investee's shares outstanding and
trading volumes, the perceived current and future value of each holding and the
most effective disposal method. Management believes that this liquidation plan
will be finalized and substantially implemented within the fiscal year ending
June 30, 2008.

In May 2003, the Company loaned $150,000 to Louisiana Land Systems Inc. The loan
was paid back in June 2006 with interest.

COMPETITION. As a result of the Company's plan to liquidate, the Company's
position as a competitor in the real estate industry is no longer applicable.

EMPLOYEES. The Company has only one employee, who serves the Company on a
part-time basis.


Item 2.   DESCRIPTION OF PROPERTIES.

The Company's administrative activities are conducted at the Company's corporate
headquarters located in Denver, Colorado in a space shared by the Company with
an affiliate, Livingston Capital, Ltd. ("Livingston"). The Company pays
Livingston a monthly fee of $500 for rent and certain overhead administrative
expenses. Prior to January 1, 2007 the monthly fee was $750.


Item 3.   LEGAL PROCEEDINGS.

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


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

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


                                     PART II

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

The Company's $.025 par value common stock trades on the Electronic Bulletin
Board under the symbol "CDGD.OB". Trading in the common stock in the
over-the-counter market has been limited and sporadic and the quotations set
forth below are not necessarily indicative of actual market conditions. Further,
these prices reflect inter-dealer prices without retail mark-up, markdown, or
commission and may not necessarily reflect actual transactions. The high and low
bid prices for the common stock for each quarter of the fiscal years ended June
30, 2007 and 2006 are as follows:

                                       4
<PAGE>

   Quarter Ended                         High Bid        Low Bid
   --------------------------------------------------------------
   June 30, 2007                         $.25            $.15
   March 31, 2007                        $.16            $.15
   December 31, 2006                     $.15            $.15
   September 30, 2006                    $.15            $.15
   June 30, 2006                         $.15            $.15
   March 31, 2006                        $1.36           $.15
   December 31, 2005                     $1.50           $1.10
   September 30, 2005                    $1.50           $.31

At September 5, 2007, the number of holders of record of the Company's common
stock was approximately 940.


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

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

LIQUIDITY AND CAPITAL RESOURCES.

At June 30, 2007, the Company had cash and cash equivalents of $241,200 and
working capital of $1,147,200.

During April 2007, the Company established a $75,000 unsecured note payable
which was advanced upon execution of the line. The line bears interest at 9.25%
and matures April 2, 2008. The line is guaranteed by the Company's president.

For the year ended June 30, 2007, operating activities consumed cash of $459,300
as compared to cash used of $158,100 for the year ended June 30, 2006. Net
income totaled $842,600 in 2007, including noncash unrealized gains from trading
securities totaling $1,139,200 in 2007. Realized gains from the sale of
investment securities were $354,500 compared to $730,800 in 2006. A liability of
$332,400 was recorded for income taxes payable in the year ended June 30, 2006
which was paid in 2007. A deferred tax liability of $458,000 was recorded in
2007 and a deferred tax asset of $82,000 was reduced to zero in 2006.

Cash consumed by investing activities was approximately $10,600 during the year
ended June 30, 2007 as compared to $1,272,900 generated during the year ended
June 30, 2006. The sale of investments provided cash of $1,198,400 in 2006.
Purchases of marketable securities used $72,400 in 2006. A note receivable was
collected in 2006 for $150,000. Purchases of fixed assets were $10,600 in 2007
and $2,200 in 2006.


                                       5
<PAGE>
Cash flows from financing activities provided $74,300 in 2007 and used $577,800
in 2006. Debt was issued in 2007 for $75,000. A cash dividend of $651,500
($0.1852 per share) was paid in the year ended 2006.

RESULTS OF OPERATIONS.

FISCAL YEAR ENDED JUNE 30, 2007 COMPARED TO FISCAL YEAR ENDED JUNE 30, 2006

The Company's revenues for the year ended June 30, 2007 totaled $1,504,300 as
compared to $764,900 in 2006. The 2007 revenues consisted primarily of
unrealized and realized gains on investment securities. Realized gains on the
sale of securities were approximately $730,800 for the year ended June 30, 2006.
Interest and dividend income totaled $10,600 and $34,100, respectively, for 2007
and 2006. During the fourth quarter of 2007, as part of the assessment of its
reporting for investment securities, the Company determined that the investment
securities then owned were most appropriately classified as trading securities
versus the classification of available-for-sale as determined in the prior year
for investment securities then owned. Investment securities held for trading and
available-for-sale are both reported at their fair market value. Unrealized
gains on available-for-sale investments are reported as other comprehensive
income, while unrealized gains on trading investments are reported in earnings,
in both cases net of applicable income taxes.

During the years ended June 30, 2007 and 2006, the Company incurred operating,
general and administrative costs of approximately $198,200 and $242,800,
respectively. The decrease in 2007 related primarily to lower professional fees
net of changes in director and officer compensation changes. The Company had
income before taxes of $1,306,100 for the year ended June 30, 2007 as compared
with $522,000 for the year ended June 30, 2006, with the increase in 2007
primarily attributable to the earnings recorded from unrealized gains on
investment securities.

INCOME TAXES

Income tax expense totaled $463,500 in 2007 and $414,000 in 2006. In 2007 the
tax provision is primarily a deferred tax expense resulting from the unrealized
gain on investment securities and in 2006 was primarily a current tax expense
resulting from the income tax gains arising from the dividend and utilization of
the prior operating losses.

As discussed in Note 6 to the accompanying financial statements, due to the
taxable gains recognized in the year ended June 30, 2006, the previous net
operating and capital losses were utilized and accordingly the prior valuation
reserve was reversed.


                                       6
<PAGE>
CRITICAL ACCOUNTING POLICIES

The preparation of financial statements in accordance with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect both the recorded values of assets and liabilities
at the date of financial statements and the revenues recognized and expenses
incurred during the reporting period. Our financial position, results of
operations and cash flows are impacted by the accounting policies we have
adopted. The Company evaluates the reasonableness of these estimates and
assumptions as part of the process of preparing its financial statements based
upon a combination of historical information and other information that comes to
our attention that may vary our outlook for the future. Actual results may
differ from these estimates under different assumptions or conditions. A summary
of our critical accounting policies follows:

Investments

Prior to selling the Company's assets in accordance with its plan of
liquidation, the Company invests its excess working capital in investments that
the Company believed had the ability to grow in value at rates in excess of
traditional money market type investments. While such investments are generally
more risky than money market or mutual fund investments, the Company has
experienced what it believes to be acceptable higher net returns for the
additional risk. At June 30, 2007, approximately $1,391,000 of the Company's
assets consisted of such investments.

Deferred Income Taxes

Deferred tax assets and liabilities are recognized for the future tax
consequences attributable to differences between the financial statement
carrying amounts of existing assets and liabilities and their respective tax
bases. Deferred tax assets and liabilities are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. The effect on deferred tax
assets and liabilities of a change in tax rates is recognized in income in the
period that includes the enactment date. If the tax law or tax rates change in
the future it could impact the available amount of loss carry forwards and/or
the recorded deferred tax amounts.

Revenue Recognition

Our revenues are recognized when sales are complete or upon the completion of
sales of securities. Revenues realized and unrealized on investment securities
accounted for a material portion of total revenues during the years ended June
30, 2007 and 2006. To the extent that we are unable to dispose of our
investments, when we make decisions to do so, due to a lack of sufficient buying
volume or other market conditions, it could impact our ability to generate
revenues, and ultimately impact the value of our investments. The Securities and
Exchange Commission's Staff Accounting Bulletin (SAB) No. 104, "Revenue
Recognition" provides guidance on the application of generally accepted
accounting principles to select revenue recognition issues. We concluded that
our revenue recognition policy is appropriate and in accordance with SAB No.
104.


                                       7
<PAGE>
Stock-Based Compensation

In December 2004, the FASB issued SFAS No. 123 (R) "Share-Based Payment", which
addresses the accounting for share-based payment transactions. SFAS No. 123(R)
eliminates the ability to account for share-based compensation transactions
using APB Opinion No. 25, "Accounting for Stock Issued to Employees", and
generally requires instead that such transactions be accounted and recognized in
the statement of income based on their fair value. SFAS No. 123 (R) was
effective for Cambridge in the quarterly reporting period beginning January 1,
2006. We evaluated the provisions of this standard. Historically, we have not
issued a significant number of options that would be impacted by this standard.
As of June 30, 2007 we have no options outstanding. Depending upon the number
and terms of options that may be granted in future periods and the estimates we
make regarding the value and amortization period of the options, this standard
could have a material impact on our future financial position and results of
operations.


Item 7.    FINANCIAL STATEMENTS.

Attached

Item 8.    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
           FINANCIAL DISCLOSURE

None

Item 8A.  CONTROLS AND PROCEDURES.

(a) Evaluation of Disclosure Controls and Procedures.

In connection with the Securities and Exchange Commission's ("SEC") regular
review of the Company's filings under the Securities Exchange Act of 1934, the
Company received correspondence from the SEC in February 2005 asking, among
other points, whether the Company should be registered as an "investment
company" under the Investment Company Act of 1940 (the "Investment Company
Act"). Generally, an issuer is deemed to be an investment company subject to
registration and reporting under the Investment Company Act if its holdings of
"investment securities" exceed 40% of the value of the issuer's total assets,
exclusive of government securities, securities issued by majority owned
subsidiaries and cash items on an unconsolidated basis.

Immediately following the Company's receipt of this correspondence from the SEC,
the Company consulted with its legal counsel about the Investment Company Act
issues raised by the SEC's letter. The Company's counsel recommended that
special legal counsel be retained with significant experience related to the
Investment Company Act to assist the Company with this issue and such special
counsel was immediately engaged.

Based upon the investigations undertaken by the Company's management and board
of directors since February 2005, including work by the Company's legal counsel,
the Company determined that it did in fact meet the definition of an investment
company as provided in Section 3(a)(1) of the Investment Company Act during
certain periods over the last several years and, accordingly, should have been
registered and reporting under the Investment Company Act. Further, in
connection with these investigations, the Company's board of directors
evaluated, under the supervision and with the participation of the Company's
chief executive officer and chief financial officer, the effectiveness of the
design and operation of the Company's disclosure controls and procedures during
the relevant periods. Based upon these investigations and evaluations, the
Company concluded that its disclosure controls and procedures were not effective
as of the end of the period covered by this report. The Company attributes this
conclusion to the fact that its controls and procedures did not reveal that the
Company qualified as an investment company subject to the registration and
reporting requirements of the Investment Company Act.


                                       8
<PAGE>
In light of these facts, the Company's board of directors unanimously concluded
that the best way to maximize shareholder value is to liquidate the assets of
the Company for distribution to its shareholders. On June 9, 2005, the Company's
plan of liquidation was unanimously approved by the board of directors. At a
special meeting of the Company's shareholders held November 3, 2005, the
shareholders approved a plan of liquidation of the Company and the distribution
of substantially all of the Company's cash and investment assets, in excess of a
reasonable operating reserve amount.

(b) Changes In Internal Control Over Financial Reporting.

There have been no changes in internal control over financial reporting that
occurred during the most recent fiscal quarter that have materially affected, or
are reasonably likely to materially affect, our internal control over financial
reporting.

Item 9.   DIRECTORS AND EXECUTIVE OFFICERS.
<TABLE>
<CAPTION>

                               Date First
                                 Elected                            Principal Occupation
Name                    Age     Director                               and Employment
<S>                     <C>       <C>                <C>
Gregory Pusey           55        1982              President, Treasurer and Director. Since 1999, Mr. Pusey has
                                                    served as a director of Bactolac Pharmaceuticals, Inc.,
                                                    (formerly - Advanced Nutraceuticals, Inc.), a former
                                                    publicly held manufacturer of nutraceuticals. Mr. Pusey is
                                                    also a director and the chairman of AspenBio Pharma, Inc., a
                                                    publicly held manufacturer of biomedical products, and
                                                    chairman of the board of directors of Security With Advanced
                                                    Technology, Inc. Mr. Pusey graduated from Boston College in
                                                    1974 with a BS in finance. Mr. Pusey is also the president
                                                    of Livingston Capital, Ltd., a venture capital and
                                                    business-consulting firm.


                                       9
<PAGE>
Scott Menefee           42        1993             Director. Mr. Menefee is the senior director of real estate
                                                   development for Opus Northwest, LLC, a large commercial real
                                                   estate development firm. During his tenure with Opus, he has
                                                   been involved in the development of over 3.5 million square
                                                   feet of commercial real estate, including office buildings,
                                                   high-rise residential condominiums, land development
                                                   shopping centers and industrial properties. Mr. Menefee
                                                   graduated from Southern Methodist University with an MBA in
                                                   1989 and the University of Denver with a BSBA in 1988.

Jeffrey G. McGonegal    56        2000             Senior Vice President-Finance, Secretary and Director. Mr.
                                                   McGonegal previously served as senior vice president-finance
                                                   of Bactolac Pharmaceuticals, Inc., (formerly Advanced
                                                   Nutraceuticals, Inc.) since February 2000 to 2006. Mr.
                                                   McGonegal also has served as chief financial officer for
                                                   Security With Advanced Technology, Inc., and AspenBio
                                                   Pharma, Inc., since 2003. Since 1997, Mr. McGonegal has also
                                                   served as managing director of McGonegal and Co., a company
                                                   engaged in providing accounting and business consulting
                                                   services. In 2005 Mr. McGonegal was elected to serve on the
                                                   board of Imagenetix, Inc., a publicly held company in the
                                                   nutritional supplements industry. He received a BA degree in
                                                   accounting from Florida State University. Mr. McGonegal is a
                                                   certified public accountant licensed in the State of
                                                   Colorado.
</TABLE>

The Company's directors serve until the next annual meeting of the shareholders
and until their successors shall have been duly elected and qualified. The
Company's Board of Directors may remove the Company's officers from their
positions at any time. There are no family relationships among the current
directors of the Company. During the fiscal year ended June 30, 2007, the
Company's board of directors held two meetings in person or by consent.

Based solely upon review of Forms 3, 4 and 5, which have been furnished to the
Company with respect to the past fiscal year of the Company, and certain
representations made by officers and directors of the Company in connection
therewith, the Company has no knowledge that any current officer or director
failed to file on a timely basis any reports required by Section 16(a) of the
Securities Exchange Act of 1934 with respect to the fiscal year of the Company
ended June 30, 2007.

Item 10.  EXECUTIVE COMPENSATION.

(a) COMPENSATION. The following table sets forth the cash compensation paid by
the Company during the fiscal year ended June 30, 2007 and in the two prior
fiscal years of the Company to the chief executive officer of the Company. No
executive officer received a total annual salary and bonus of more than $100,000
during the fiscal year.

                                       10
<PAGE>
<TABLE>
<CAPTION>

                           Summary Compensation Table

              Annual Compensation                        Awards        Payouts
              -------------------                        ------        -------
                                      Other
Name and                             Annual     Restricted              LTIP     All Other
 Principal   Fiscal  Salary         Compensa-      Stock       Options Payouts   Compensa-
Position      Year   ($)(1)  Bonus  tion (2)     Awards($)       (#)     ($)    tion($)(3)
<S>           <C>    <C>       <C>   <C>             <C>          <C>     <C>      <C>
Gregory Pusey,
President     2007   60,000   -0-    35,000         -0-          -0-     -0-       7,143
              2006   60,000   -0-      -0-          -0-          -0-     -0-       7,725
              2005   60,000   -0-      -0-          -0-          -0-     -0-       7,725
</TABLE>

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

(2) Other annual compensation in 2007 consists of a cash payment awarded by the
Board of Directors for services in enhancing the assets for the Company's
shareholders.

(3) All other compensation paid that the Company has not properly reported in
any other column of the Table. During the period covered by the Table, the
Company did not make any contributions or other allocations to any defined
contribution plans. The compensation shown is health insurance premiums paid on
Mr. Pusey's behalf. The company has provided an automobile to Mr. Pusey and paid
associated operating and insurance costs. For the year ended June 30, 2007, the
lease costs totaled approximately $3,100. In prior years the Company had
provided a company-owned vehicle.

2001 STOCK OPTION PLAN. In October 2001, the Board of Directors of the Company
adopted the 2001 Stock Incentive Plan (the "2001 Plan"). The 2001 Plan was
approved by majority vote of the shareholders in May 2002. The purpose of the
2001 Plan is to promote the interests of the Company and its shareholders by:

     o    Attracting and retaining key personnel;
     o    Providing participants a significant stake in the performance of the
          Company;
     o    Providing an opportunity for participants to increase their holdings
          of the Company's common stock.

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

                                       11
<PAGE>
Any employee or officer (including executive officers) of the Company or any of
its subsidiaries will be eligible for a stock option grant under the 2001 Plan
if selected by the Option Committee. Any consultant to the Company, including
directors, will also be eligible to receive option grants under the 2001 Plan if
authorized by the Option Committee.

The 2001 Plan authorizes the grant of options to purchase up to 650,000 shares
of the Company's common stock. As of June 30, 2007, no options to purchase
shares were outstanding.

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

The Board of Directors may amend or terminate the 2001 Plan at any time. No
amendments may be made without the approval of the Company's shareholders to the
extent such approval is required by law or agreement. The 2001 Plan will
continue until October 4, 2011, unless abandoned or terminated at an earlier
time.

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

     The Company has no outstanding options; accordingly, this section is
omitted.

     (c) EQUITY COMPENSATION PLAN INFORMATION

     The Company has no outstanding options; accordingly, this section is
omitted.


DIRECTOR COMPENSATION
<TABLE>
<CAPTION>

                                     Fees
                                   Earned or      Stock       Option       Non-Equity
                                     Paid         Awards     Awards ($)  Incentive Plan    All Other
    Name                           in Cash ($)      ($)                   Compensation   Compensation    Total
--------------------              ------------   ---------   ----------  --------------  ------------   ------
<S>                               <C>                        <C>                                        <C>
Gregory Pusey                     $    **           --       $     --          --             **        $   **
 Director

Scott Menefee                     $  2,000          --       $     --          --             --        $ 2,000
 Director

Jeffrey G. McGonegal              $ 50,000          --       $     --          --             --        $50,000
 Director
</TABLE>

    **- See disclosure under Item 10 (a).


                                       12
<PAGE>

Equity Compensation Plan Information

The following table gives information about the Company's common stock that may
be issued upon the exercise of options under the 2001 Stock Incentive Option
Plan as of June 30, 2007.
<TABLE>
<CAPTION>

                                                       (c) Number of
                                                         Securities
                                                          Remaining
                                                        Available for
                            (a) Number                     Future
                          of Securities   (b) Weighted     Issuance
                           to be Issued      Average     Under Equity
                           Upon Exercise    Exercise    Compensation
                          of Outstanding    Price of        Plans     (d) Total of
                             Options,      Outstanding   (Excluding     Securities
                             Warrants       Options,     Securities    Reflected in
                                and         Warrants    Reflected in     Columns
  Plan Category               Rights       and Rights    Column (a))   (a) and (c)
-------------------------  ------------    -----------  ------------   ------------
<S>                                         <C>            <C>           <C>
Equity Compensation Plans
Approved by Stockholders        --          $    --        650,000       650,000

Equity Compensation Plans
Not Approved by
Stockholders                    --          $    --            --            --

TOTAL                           --          $    --        650,000       650,000

</TABLE>


                                       13
<PAGE>
Jeffrey
Item 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR
          INDEPENDENCE

Pursuant to an oral agreement with Livingston, which is an affiliate of Gregory
Pusey, the Company pays $500 per month to Livingston for rent ($750 per month
through December 2006) and certain administrative expenses. The Company believes
that these arrangements have been at least as favorable as could be obtained
with a non-affiliated party. In addition, the Company provided a car for Gregory
Pusey which expired upon the termination of the current lease in October 2006.

Commencing in December 2001, the Company made a series of investments in
AspenBio ("AspenBio"). At June 30, 2007 the Company owned 293,487 common shares
of AspenBio, including 128,571 shares which were acquired in April 2007 upon the
exercise of warrants at an average exercise price of $1.17 per share (upon the
April 2007 exercise, the Company sold 100,000 of the shares for approximately
$445,000 in cash in order to reduce the level of its investment assets). Greg
Pusey, president of the Company, serves as chairman of the AspenBio board of
directors and Jeffrey G. McGonegal, chief financial officer of the Company,
serves as AspenBio's chief financial officer. These exercises of AspenBio
warrants were done to maximize shareholder value, as the warrants were either
being redeemed for nominal value if not then exercised or were scheduled to
expire.


                                       14
<PAGE>

Commencing in March 2002, the Company made a series of investments in SWAT.
SWAT, which completed an initial public offering of its securities in July 2005,
develops and markets non-lethal and personal protection devices and facility and
mobile security systems for the security and surveillance industries, including
consumers. The Company currently owns 6,007 common shares and 5,000 publicly
tradable warrants in SWAT. Greg Pusey, president of the Company, serves as
chairman of the SWAT board of directors and Jeffrey G. McGonegal, chief
financial officer of the Company, serves as SWAT's chief financial officer.

Of the Company's directors, Scott Menefee has been determined to be an
independent director. There have been no separate committees designated by the
Board.

Item 13.  EXHIBITS

     (a)  EXHIBITS.

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


                                INDEX TO EXHIBITS

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

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

     10.1 2001 Stock Option Plan filed as Exhibit 10(n) in the Registrant's
          Report on Form 10-KSB for the year ended June 30, 2001 is incorporated
          herein by this reference.

     31.1 CEO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of
          2002.

     31.2 CFO Certification pursuant to Section 302 of the Sarbanes-Oxley Act of
          2002.

     32   CEO and CFO Certification pursuant to Section 906 of the
          Sarbanes-Oxley Act of 2002.




Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

     (a) Audit Fees. During the fiscal years ended June 30, 2007 and 2006, the
aggregate fees billed by the Company's previous auditors, for services rendered
for the audit of our annual financial statements and the review of the financial
statements included in our quarterly reports on Form 10-QSB for services
provided in connection with the statutory and regulatory filings or engagements
for those fiscal years, was $8,500 and $12,500, respectively.

     (b) Audit-Related Fees. During fiscal years ended June 30, 2007 and 2006
our auditors did not receive any fees for any audit-related services other than
as set forth in paragraph (a) above.

     (c) Tax Fees. Our auditors did not provide tax compliance or tax planning
advice during the fiscal years ended June 30, 2007 and 2006.



                                   SIGNATURES

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

                                            CAMBRIDGE HOLDINGS, LTD.

Date: September 28, 2007               By:  /s/ Gregory Pusey
                                            ---------------------------------
                                            Gregory Pusey
                                            President, Treasurer and Director

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

Date: September 28, 2007               By:  /s/ Gregory Pusey
                                            ---------------------------------
                                            Gregory Pusey
                                            President, Treasurer and Director



Date: September 28, 2007               By:  /s/ Jeffrey G. McGonegal
                                            ---------------------------------
                                            Jeffrey G. McGonegal
                                            Senior Vice President-Finance,
                                            and Secretary and Director


Date: September 28, 2007               By:  /s/ Scott Menefee
                                            ---------------------------------
                                            Scott Menefee, Director



                                       15
<PAGE>

                          Index to Financial Statements
                                                                      Page


Report of Independent Registered Public Accounting Firm               F-2



Balance Sheet                                                         F-3

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

Statements of Changes in Stockholders' Equity                         F-5

Statements of Cash Flows                                              F-6

Notes to Financial Statements                                         F-7









                                       F-1

<PAGE>

             REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM



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

We have audited the accompanying balance sheet of Cambridge Holdings, Ltd. as of
June 30, 2007, and the related statements of operations and comprehensive income
(loss), changes in stockholders' equity, and cash flows for each of the years in
the two-year period ended June 30, 2007. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an
opinion on these financial statements based on our audits.

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

In our opinion, the financial statements referred to above present fairly, in
all material respects, the financial position of Cambridge Holdings, Ltd. as of
June 30, 2007, and the results of its operations and comprehensive income (loss)
and its cash flows for each of the years in the two-year period ended June 30,
2007, in conformity with generally accepted accounting principles in the United
States of America.


                                        /s/ CORDOVANO AND HONECK LLP
                                        ----------------------------
                                        CORDOVANO AND HONECK LLP
                                        CERTIFIED PUBLIC ACCOUNTANTS

Englewood, Colorado
September 8, 2007




<PAGE>
                            CAMBRIDGE HOLDINGS, LTD.
                                  BALANCE SHEET
                                  JUNE 30, 2007


                                     ASSETS
                                     ------

CURRENT ASSETS:
     Cash and cash equivalents                                     $   241,243
     Investment securities  (Note 2)                                 1,390,842
     Prepaid and other assets                                           55,962
                                                                   -----------

                  Total current assets                               1,688,047

Property and equipment, net (Note 5)
                                                                        10,400
                                                                   $ 1,698,447
                                                                   ===========
                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------

CURRENT LIABILITIES:
     Accounts payable and accrued expenses                         $     7,808
     Line of credit (Note 7)                                            75,000
        Deferred income tax liability (Note 6)                         458,000
                                                                   -----------

                  Total current liabilities                            540,808
                                                                   -----------
COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY:
     Common stock, $.025 par value; 15,000,000 shares
         authorized: 3,509,877 issued and outstanding                   87,747
     Additional paid-in capital                                      1,707,132
     Accumulated (deficit)                                            (637,240)
                                                                   -----------

                                                                     1,157,639
                  Total stockholders' equity
                                                                   $ 1,698,447
                                                                   ===========


                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

                                      F-3



<PAGE>



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



                                                   For the Years Ended June 30,
                                                   ----------------------------
                                                        2007           2006
                                                    -----------    -----------
REVENUES:
     Gains on investment securities:
     Net realized gains (losses)                    $   354,465    $   730,771
     Net unrealized gains (losses)                    1,139,188             --
     Interest, dividend and other income                 10,625         34,094
                                                    -----------    -----------

                  Total revenues                      1,504,278        764,865
                                                    -----------    -----------



OPERATING (EXPENSES) AND OTHER INCOME:
     Operating, general and administrative             (198,190)      (242,817)
                                                    -----------    -----------




NET INCOME (LOSS) BEFORE INCOME TAX                   1,306,088        522,048

     Income Tax Expense (Note 6)                       (463,500)      (414,000)
                                                    -----------    -----------

NET INCOME (LOSS)                                       842,588        108,048

OTHER COMPREHENSIVE INCOME, net of tax -
     Unrealized holding gains                                --     (2,569,665)
     Net unrealized (loss)                                   --          7,609
                                                    -----------    -----------


COMPREHENSIVE INCOME (LOSS)                         $   842,588    $(2,454,008)
                                                    ===========    ===========

NET INCOME (LOSS) PER COMMON SHARE, BASIC AND
    DILUTED                                         $       .24    $      (.03)
                                                    ===========    ===========

Weighted average number of basic and diluted
     common shares outstanding                        3,509,877      3,449,985
                                                    ===========    ===========


                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

                                      F-4


<PAGE>

<TABLE>
<CAPTION>
                            CAMBRIDGE HOLDINGS, LTD.
                  STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
                   FOR THE YEARS ENDED JUNE 30, 2007 AND 2006



                                                                                              Accumulated
                                                                Additional                       Other         Total
                                           Common Stock          Paid-in       Accumulated   Comprehensive  Stockholders'
                                        Shares      Par Value    Capital        (Deficit)    Income/(Loss)     Equity
                                     ----------   -----------   -----------    -----------    -----------    -----------
<S>            <C> <C>                <C>         <C>           <C>            <C>            <C>            <C>
Balances, June 30, 2005               3,179,870   $    79,497   $ 3,048,667    $(1,587,876)   $ 2,562,051    $ 4,102,339

   Net unrealized gains on
      securities available for sale          --            --            --             --     (2,569,665)    (2,569,665)


   Net realized gain on LLCs                 --            --            --             --          7,609          7,609


   Exercise of stock options            200,000         5,000        68,750             --             --         73,750

   Adjustment to par value  for
      cashless exercise of options       130,007         3,250        (3,250)            --             --             --


   Dividends paid                            --            --    (1,407,035)            --             --     (1,407,035)


   Net (loss) for the year                   --            --            --        108,048             --        108,048
                                     ----------   -----------   -----------    -----------    -----------    -----------

Balances, June 30, 2006               3,509,877   $    87,747   $ 1,707,132    $(1,479,828)   $        (5)   $   315,046

   Net unrealized gains on
       securities available for sale         --            --            --             --              5              5


   Net income for the year                   --            --            --        842,588             --        842,588
                                     ----------   -----------   -----------    -----------    -----------    -----------

Balances, June 30, 2007               3,509,877   $    87,747   $ 1,707,132    $  (637,240)   $        --    $ 1,157,639
                                     ==========   ===========   ===========    ===========    ===========    ===========
</TABLE>


                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS


                                      F-5
<PAGE>

<TABLE>
<CAPTION>

                            CAMBRIDGE HOLDINGS, LTD.
                            STATEMENTS OF CASH FLOWS

                                                                  For the Years Ended June 30,
                                                                      2007           2006
                                                                  -----------    -----------
CASH FLOWS FROM (TO) OPERATING ACTIVITIES:
<S>                                                               <C>            <C>
Net income                                                        $   842,588    $   108,048
  Adjustments to reconcile net income to net cash
     provided (used) by operating activities:
       Depreciation and amortization                                    2,751            362
       Unrealized (gains) on trading investment securities         (1,139,188)            --
       Realized (gains) losses on sale of investment securities      (354,465)      (730,771)
       Change in deferred income taxes                                458,000         82,000
  Changes in:
       Accounts receivable-related party                                   --         57,722
       Accrued interest receivable - related party                         --            594
       Trading investment securities - net                            108,301             --
       Prepaid and other                                              (49,327)        (6,260)
       Accrued liabilities and other                                 (327,989)       330,193
                                                                  -----------    -----------

         Cash Flows (Used) By Operating Activities                   (459,329)      (158,112)
                                                                  -----------    -----------

CASH FLOWS FROM (TO) INVESTING ACTIVITIES:
  Proceeds from sale of investment securities                              --         70,513
  Purchase of marketable securities                                        --        (72,410)
  Proceeds from sale of marketable securities                              --      1,127,919
  Collection on notes receivable                                           --        150,000
  Purchase of fixed assets                                            (10,571)        (2,219)

  Changes in other assets                                                  --           (866)
                                                                  -----------    -----------

         Cash Flows (Used) Provided By Investing Activities           (10,571)     1,272,937
                                                                  -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Cash dividend paid                                                       --       (651,508)
  Proceeds from exercise of stock options                                  --         73,750
  Proceeds from issuance of debt                                       75,000             --
  Fees paid for issuance of debt                                         (750)            --
                                                                  -----------    -----------

         Cash Flows Provided (Used) By Investing Activities            74,250       (577,758)
                                                                  -----------    -----------


NET (DECREASE) IN CASH AND CASH EQUIVALENTS                          (395,650)       537,067

CASH AND CASH EQUIVALENTS, beginning of year                          636,893         99,826
                                                                  -----------    -----------

CASH AND CASH EQUIVALENTS, end of year                            $   241,243    $   636,893
                                                                  ===========    ===========

SUPPLEMENTAL CASH FLOW INFORMATION:
  Cash paid during the year for:
     Interest                                                     $        --    $        --
                                                                  ===========    ===========
     Income taxes                                                 $   388,000    $        --
                                                                  ===========    ===========
  Schedule of non-cash investing and financing activities:
       Issuance of 130,007 shares of common stock in 2006 for
       cashless exercise of warrants                              $        --    $        --
                                                                  ===========    ===========

       Conversion of notes receivable into common stock of A4S    $        --    $   425,034
                                                                  ===========    ===========
       Property distribution as dividend                          $        --    $   755,527
                                                                  ===========    ===========
</TABLE>


                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

                                      F-6


<PAGE>

                             CAMBRIDGE HOLDINGS LTD.
                          NOTES TO FINANCIAL STATEMENTS
                          -----------------------------


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

Organization and Business
-------------------------
Cambridge Holdings, Ltd. ("Cambridge" or "the Company") was incorporated on June
23, 1980 under the laws of the State of Colorado. The fiscal year end is June
30. The Company's operations have consisted of investments in the stock market,
real estate development and other business investments. The Company also
explores other business acquisitions, opportunities and investments.

In connection with the SEC's regular review of our filings under the Securities
Exchange Act of 1934, we received correspondence from the SEC asking, among
other points, whether we should be registered as an investment company under the
Investment Company Act of 1940. Generally, an issuer is deemed to be an
investment company subject to registration if its holdings of "investment
securities," which usually are securities other than securities issued by
majority owned subsidiaries and government securities, exceed 40% of the value
of its total assets exclusive of government securities and cash items on an
unconsolidated basis.

Immediately following our receipt of correspondence from the SEC, we consulted
with our legal counsel about the Investment Company Act issues raised by the
SEC's letter. Our counsel recommended that we engage special legal counsel with
significant experience related to the Investment Company Act to assist us with
this issue and we did in fact engage such special counsel and we are now working
with the SEC to respond to its question. Since February 2005, our management and
board have undertaken numerous discussions to investigate and explore the best
course of action. Based upon the investigation undertaken by our management and
board, including work by our legal counsel and special legal counsel, the
Company has determined that the Company has met the definition of an "investment
company" as provided in Section 3(a)(1) of the Investment Company Act; and
accordingly should have been registered and reporting as an investment company.

During multiple meetings, our board of directors reviewed and discussed the
information that management had gathered. After such discussions, the board on
June 9, 2005, unanimously concluded that the best way to maximize shareholder
value would be to liquidate the Company. Management and the Company's counsel
then developed a plan of liquidation to be completed on an orderly basis to
maximize value to the shareholders that was unanimously approved by the board of
directors on June 9, 2005. At a special meeting of the Company's shareholders
held November 3, 2005, the shareholders approved the plan of liquidation of the
Company and the distribution of substantially all of the Company's cash and
investment assets, except for a reasonable operating reserve amount. This
distribution was completed during December 2005.


                                      F-7
<PAGE>

                             CAMBRIDGE HOLDINGS LTD.
                          NOTES TO FINANCIAL STATEMENTS
                          -----------------------------

Management of the Company is currently evaluating the most prudent methods and
timing of liquidating the remaining investments currently held by the Company in
AspenBio and SWAT. The evaluation includes consideration of the magnitude of
each holding as compared to the investee's shares outstanding and trading
volumes, the perceived current and future value of each holding and the most
effective disposal method. Management believes that this liquidation plan will
be finalized and substantially implemented within the fiscal year ending June
30, 2008. Use of Estimates The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates
and assumptions.

Investment Securities
---------------------
Investment securities classified as trading are those securities that are bought
and held principally for the purpose of selling them in the near term with the
objective of generating profits. These securities are reported at fair value
with unrealized gains and losses reported as an element of current period
earnings.

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

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

Concentration of Credit Risk
----------------------------
From time to time the Company's cash position has exceeded the federally insured
limits, but no losses have been experienced. At June 30, 2007, the Company's
cash in financial institutions exceeded the federally insured deposit limit by
approximately $127,000.

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

Property and Equipment
----------------------
Property and equipment are recorded at cost. Depreciation expense is generally
provided on a straight-line basis using estimated useful lives of 3-5 years.
Total depreciation expense was $2,375 and $362 for the years ended June 30, 2007
and 2006, respectively.

Impairment of Long-Lived Assets
-------------------------------
The Company evaluates its long lived assets by measuring the carrying amount of
the assets against the estimated undiscounted future cash flows associated with
them. At the time such evaluations indicate the future undiscounted cash flows
of certain long lived assets are not sufficient to cover the carrying value of
such assets, the assets are adjusted to their fair values.

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

                                      F-8

<PAGE>
                             CAMBRIDGE HOLDINGS LTD.
                          NOTES TO FINANCIAL STATEMENTS
                          -----------------------------

Earnings Per Common Share
-------------------------
The Company computes earnings per common share in accordance with Statement of
Financial Accounting Standards No. 128, Earnings Per Share (SFAS No. 128). This
Statement simplifies the standards for computing earnings per share (EPS)
previously found in Accounting Principles Board Opinion No. 15, Earnings Per
Share, and makes them more comparable to international EPS standards. SFAS No.
128 replaces the presentation of primary EPS with a presentation of basic EPS.
In addition, the Statement requires dual presentation of basic and diluted EPS
on the face of the income statement for all entities with complex capital
structures and requires a reconciliation of the numerator and denominator of the
basic EPS computation to the numerator and denominator of the diluted EPS
computation. The Company had no dilutive instruments outstanding in 2007 or
2006.

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

Stock Based Compensation
------------------------
Stock based compensation is accounted for under Statement of Financial
Accounting Standards ("SFAS") No. 123 (revised 2004), "Share-Based Payment"
("SFAS 123R"), using the modified prospective method. SFAS 123R requires the
recognition of the cost of employee services received in exchange for an award
of equity instruments in the financial statements and is measured based on the
grant date fair value of the award. SFAS 123R also requires the stock option
compensation expense to be recognized over the period during which an employee
is required to provide service in exchange for the award (generally the vesting
period). Prior to the Company adopting SFAS 123R, the Company accounted for
employee stock-based compensation plans under Accounting Principles Board
Opinion ("APB") No. 25, "Accounting for Stock Issued to Employees" ("APB 25").
Under APB 25, generally no compensation expense was recorded when the terms of
the award were fixed and the exercise price of the employee stock option equaled
or exceeded the fair value of the underlying stock on the date of grant. The
Company had previously adopted the disclosure-only provision of SFAS No. 123,
"Accounting for Stock-Based Compensation" ("SFAS 123"). Through 2005, the
Company had applied APB Opinion No. 25 and related Interpretations in accounting
for its stock-based employee compensation plans. Accordingly, no compensation
expense had been recognized for options granted to employees at fair market
value. During 2006 and 2007 the Company has not issued any rights accounted for
under these provisions.

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

                                      F-9
<PAGE>

                             CAMBRIDGE HOLDINGS LTD.
                          NOTES TO FINANCIAL STATEMENTS
                          -----------------------------

The change in net unrealized securities gains (losses) recognized in other
comprehensive income includes two components, both computed for available-for
sale securities on the specific identification method: (1) unrealized gains
(losses) that arose during the period from changes in market value of securities
that were held during the period (holding gains (losses)), and (2) gains or
(losses) that were previously unrealized, but have been recognized in current
period net income due to sales of available-for sale securities
(reclassification for realized gains). Such amounts are reported net of income
taxes, however due to the net operating loss carryforwards that had been
available; no income taxes were applied on the computed amounts. This
reclassification has no effect on total comprehensive income (loss) or
shareholder's equity.

Recently Issued Accounting Pronouncements
-----------------------------------------

In July 2006, the FASB issued FASB Interpretation No.48, "Accounting for
Uncertainty in Income Taxes, an interpretation of FASB Statement 109"("FIN 48")
which clarifies the accounting for uncertainty in income taxes recognized in
accordance with SFAS No. 109, "Accounting for Income Taxes." FIN 48 is a
comprehensive model for how a company should recognize, measure, present, and
disclose in its financial statements uncertain tax positions that the company
has taken or expects to take on a tax return. If an income tax position exceeds
a more likely than not (greater than 50%) probability of success upon tax audit,
the company will recognize an income tax benefit in its financial statements.
Additionally, companies are required to accrue interest and related penalties,
if applicable, on all tax exposures consistent with jurisdictional tax laws. The
effective date of this interpretation will be fiscal years beginning after
December 15, 2006, the fiscal year beginning July 1, 2007 for the Company.
Management is currently in the process of evaluating the impact of this
interpretation on the Company's financial statements.

NOTE 2 - INVESTMENT SECURITIES

During the fourth quarter of 2007, as part of the assessment of its reporting
for investment securities, the Company determined that the investment securities
then owned were most appropriately classified as trading securities versus the
classification of available-for-sale as determined in the prior year for
investment securities then owned. Investment securities held for trading and
available-for-sale are both reported at their fair market value. Unrealized
gains on available-for-sale investments are reported as other comprehensive
income, while unrealized gains on trading investments are reported in earnings,
in both cases net of applicable income taxes. At June 30, 2007 no investments
are reported in other comprehensive income.

At June 30, 2007 the Company's market value of trading securities consisted
primarily of securities with a fair market value of approximately $1,390,800 and
a cost of approximately $246,300. Included were 293,487 common shares of
AspenBio Pharma, Inc., at a cost of approximately $237,100 and a fair market
value of approximately $1,364,700. Also included were 6,007 common shares and
5,000 common stock purchase warrants ("SWATW") of SWAT at a cost of $9,200 and a
fair market value of $26,100.

The Company realized net gains of $354,465 and $730,771 and proceeds from sales
of $467,631 and $70,513, on the sale of investment securities for the years
ended June 30, 2007 and 2006, respectively. During the year ended June 30, 2007,
a total of $1,139,188 was recognized in earnings from the change in value of
trading securities and primarily resulted from the transfer of securities from
the available for sale category to the trading category. Gains and losses from
investment securities are determined from quoted market prices based upon the
specific identification method. Due to the size of the AspenBio block of common
shares owned, the forced liquidation of this investment into the marketplace
over a short period of time could have an impact on its realizable value.

                                      F-10
<PAGE>

                             CAMBRIDGE HOLDINGS LTD.
                          NOTES TO FINANCIAL STATEMENTS
                          -----------------------------

NOTE 3 - NOTES RECEIVABLE

In May 2003, the Company loaned $150,000 to Louisiana Land Systems Inc. The loan
was paid back in June 2006 with interest.


NOTE 4 - NOTES RECEIVABLE - RELATED PARTIES

In July 2004 the Company loaned $10,000 to AspenBio that was repaid later in
July 2004 with interest.

Commencing in December 2002 through August 2004, the Company made a series of
loans to A4S Security, Inc. (formerly, A4S Technologies, Inc.) ("A4S"). A4S
which completed an initial public offering of its securities in July 2005,
markets high resolution mobile digital video recording systems for security and
surveillance. Cumulatively approximately $557,000 was invested in A4S with
$132,000 (through debt conversion and warrants exercises) represented by 18,801
common shares of A4S and $425,000 represented by 6% convertible notes payable,
as of June 30, 2005. In connection with the public offering by A4S in July 2005,
the convertible notes and accrued interest were converted into a total of
439,000 common shares of A4S. In connection with certain of the note
investments, the Company received 7,133 warrants to acquire common stock of A4S.
The warrants are exercisable at an average exercise price of $5.65 per share. In
connection with the initial transaction, Gregory Pusey, President of the
Company, became a member of the A4S board of directors and subsequently became
the chairman.


NOTE 5 - PROPERTY AND EQUIPMENT

Property and equipment consists of the following:

                                                                   June 30,
                                                                     2007
                                                                  --------
     Furniture and fixtures                                         10,027
     Office equipment                                                4,328
                                                                  --------

     Total                                                          14,355
     Less accumulated depreciation                                  (3,955)
                                                                  --------

                                                                  $ 10,400
                                                                  ========

NOTE 6 - INCOME TAX EXPENSE (BENEFIT)

At June 30, 2007 the Company had recorded a deferred tax liability of $458,000
related to the difference in financial and income tax reporting of the
unrealized gains of the trading investment securities. Due to the taxable gains
in the year ended June 30, 2006, the then existing net operating and capital
losses have been utilized and the prior valuation reserve reversed.


                                      F-11
<PAGE>
                             CAMBRIDGE HOLDINGS LTD.
                          NOTES TO FINANCIAL STATEMENTS
                          -----------------------------

Income tax expense (benefit) consisted of:

                                                 For the Years Ended June 30,
                                                    2007             2006
                                                  --------         --------
     Current income taxes                         $  5,500         $332,000
     Deferred income taxes                        $458,000         $ 82,000
                                                  --------         --------
     Income tax expense                           $463,500         $414,000
                                                  ========         ========



NOTE 7 - LINE OF CREDIT

During April 2007, the Company established a $75,000 unsecured note payable
which was advanced upon execution of the line. The line bears interest at 9.25%
and matures April 2, 2008. The line is guaranteed by the Company's president.



NOTE 8 - STOCKHOLDERS' EQUITY AND STOCK OPTIONS

Stockholders' Equity
--------------------
During the year ended June 30, 2006, the Company completed a dividend
distribution of approximately $650,000 in cash and 420,000 common shares it
owned in Bactolac Pharmaceuticals, Inc., and 462,000 common shares it owned in
Security With Advanced Technology, Inc. The shares distributed had been
accounted for as investment securities available for sale and were recorded at
fair value, so no gain or loss was recorded at the time of distribution.

2001 Stock Option Plan
----------------------
The Company's 2001 Stock Option Plan, as amended, has a maximum of 650,000
common shares reserved to be issued to employees and consultants upon the
exercise of options granted under the Plan. The option price of shares may not
be less than the fair market value of common stock on the date of grant. The
option price of shares issued to more than 10% shareholders may not be less than
110% of the fair market value of common stock on the date of grant. The exercise
term will not exceed ten years from the date of grant. At June 30, 2007 no
options are outstanding under the Plan.

NOTE 9 - RELATED PARTY TRANSACTIONS

In addition to the related party transactions disclosed elsewhere in these
financial statements, the Company had the following related party transactions.

The Company shares corporate office space and administrative staff with an
affiliate of the Company. The Company paid its affiliate $750 per month for
these facilities and services through December 31, 2006 when the monthly amount
was reduced to $500.

The Company held investment securities in Bactolac Pharmaceuticals, Inc.,
(formerly - Advanced Nutraceuticals, Inc.), ("ANI") classified as available for
sale at June 30, 2006 with an estimated fair value of $1,888. During the year
ended June 30, 2006, a gain of $719,490 was recognized upon the sale of ANI
shares. During the year ended June 30, 2007, 81 shares of ANI stock held by
Cambridge were redeemed by ANI as part of a reverse split of the ANI common
shares and one post split share was sold. A gain of $1,639 was recorded on these
transactions.

                                      F-12
<PAGE>

                             CAMBRIDGE HOLDINGS LTD.
                          NOTES TO FINANCIAL STATEMENTS
                          -----------------------------

At June 30, 2007 the Company owned 293,487 common shares of AspenBio Pharma,
Inc. ("AspenBio"). This holding included the April 2007 warrant exercise for
cash of 128,571 AspenBio common share purchase warrants. Upon this exercise, the
Company sold 100,000 of these AspenBio common shares for approximately $445,000
in cash in order to reduce the level of its investment assets. Greg Pusey,
president of the Company, serves as chairman of the AspenBio board of directors
and Jeffrey G. McGonegal, chief financial officer of the Company, serves as
AspenBio's chief financial officer. These exercises of AspenBio warrants were
done to maximize shareholder value, as the warrants were either being redeemed
for nominal value if not then exercised or were scheduled to expire.

At June 30, 2007 the Company owned 6,007 shares of Security With Advanced
Technology, Inc., ("SWAT") with a value of approximately $24,000 and owned 5,000
SWAT warrants with a value of approximately $2,100.

During the year ended June 30, 2006 in order to dispose of a restricted
investment in a privately held LLC, it was sold to certain officers, directors
and stockholders (including Greg Pusey and Jeff McGonegal) for its net cost
basis of approximately $71,000.

During the year ended June 30, 2007, Greg Pusey received a total of
approximately $42,143 for consulting services, automobile expenses and
reimbursement of health insurance costs, and Jeff McGonegal received a total of
approximately $50,000 for consulting services.





                                      F-13

<PAGE>