United States
                       Securities and Exchange Commission
                             Washington, D.C. 20549

                                    FORM 10-K

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

     For the fiscal year ended June 30, 2009

(_)  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 Registrant 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)


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


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

              Securities Registered Under Section 12(g) of the Act:

                          Common stock, $.025 par value
                          -----------------------------
                                (Title of Class)

Indicate by check mark if the registrant is a well known, seasoned issuer, as
defined in Rule 405 of the Securities Act:   Yes [_]   No |X|

Indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or 15(d) of the Exchange Act:   Yes [_]    No |X|

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the past 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.    Yes |X| No [_]

Indicate by check mark whether the registrant has submitted electronically and
posted on its corporate web site, if any, every interactive data file required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (ss.232.405 of
this chapter) during the preceding 12 months (or for such shorter period that
the registrant was required to submit and post such files).   Yes [_] No [_]


<PAGE>
Indicate by check mark if disclosure of delinquent filer pursuant to Item 405 of
Regulation S-K (ss.229.405) is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. Yes [_] No |X|

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of "large accelerated filer," "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act:

         Large accelerated filer [_]               Accelerated filer [_]

         Non-accelerated filer [_]                 Smaller reporting company [X]
(Do not check if smaller reporting company)

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

The aggregate market value of common stock held by non-affiliates of the
registrant as of June 30, 2009, computed by reference to the closing price on
that date, was $450,500.

The number of shares outstanding of the registrant's common stock at September
24, 2009 was 3,509,877.






<PAGE>

                            CAMBRIDGE HOLDINGS, LTD.
                      INDEX TO ANNUAL REPORT ON FORM 10-K



                                     PART I                                 Page

Item 1.   Business                                                             4
Item 1A.  Risk Factors                                                         6
Item 1B.  Unresolved Staff Comments                                            7
Item 2.   Properties                                                           7
Item 3.   Legal Proceedings                                                    7
Item 4.   Submission of Matters to a Vote of Security Holders                  7

                                     PART II

Item 5.   Market for Registrant's Common Equity, Related Stockholder
          Matters and Issuer Purchases of Equity Securities                    7
Item 6.   Selected Financial Data                                              8
Item 7.   Management's Discussion and Analysis of Financial Condition
          and Results of Operations                                            8
Item 7A.  Quantitative and Qualitative Disclosures About Market Risk          10
Item 8.   Financial Statements and Supplementary Data                         10
Item 9.   Changes in and Disagreements with Accountants on Accounting
          and Financial Disclosures                                           10
Item 9A(T)Controls and Procedures                                             10
Item 9B   Other Information                                                   13

                                    PART III


Item 10.  Directors and Executive Officers and Corporate Governance           14
Item 11.  Executive Compensation                                              15
Item 12.  Security Ownership of Certain Beneficial Owners and Management
          and Related Stockholder Matters                                     16
Item 13.  Certain Relationships and Related Transactions and Director
          Independence                                                        18
Item 14.  Principal Accountant Fees and Services                              19

                                     PART IV

Item 15.  Exhibits and Financial Statement Schedules                          20
          Signatures                                                          21


                 DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this report that are not historical facts
constitute forward-looking statements, within the meaning of the Private
Securities Litigation Reform Act of 1995, and are intended to be covered by the
safe harbors created by that act. Reliance should not be placed on
forward-looking statements because they involve known and unknown risks,
uncertainties, and other factors, which may cause actual results, performance,
or achievements to differ materially from those expressed or implied. Any
forward-looking statement speaks only as of the date made. We undertake no
obligation to update any forward-looking statements to reflect events or
circumstances after the date on which they are made.

Statements concerning the establishment of reserves and adjustments for dated
and obsolete products, expected financial performance, on-going business
strategies and possible future action which we intend to pursue to achieve
strategic objectives constitute forward-looking information. The sufficiency of
such charges, implementation of strategies and the achievement of financial
performance are each subject to numerous conditions, uncertainties, and risk
factors. Factors which could cause actual performance to differ materially from
these forward-looking statements, include, without limitation, management's
analysis of our assets, liabilities, and operations, the failure to sell
date-sensitive inventory prior to its expiration, competition, new product
development by competitors, which could render particular products obsolete, the
inability to develop or acquire and successfully introduce new products or
improvements of existing products, problems in collecting receivables, testing
or other delays or problems in introducing any of our development products, and
difficulties in obtaining financing on an as-needed basis.






<PAGE>

                                     Part I

Item 1.   BUSINESS.

(a) BUSINESS DEVELOPMENT. Cambridge Holdings, Ltd. (the "Company," "we," "us,"
"our"), 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 United States Securities and Exchange Commission's (the
"SEC") regular review of our filings under the Securities Exchange Act of 1934,
as amended (the "Exchange Act") 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 (the "Investment Company Act").
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 the SEC's correspondence, 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 of directors 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, on June 9,
2005, the board 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. 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 the corporation now known as PepperBall
Technologies, Inc. ("PepperBall") (formerly Security With Advanced Technology,
Inc.) and approximately 420,500 shares of common stock of Bactolac
Pharmaceutical, Inc., with a combined cost basis of approximately $755,500.

In September 2002, the Company completed a pro rata distribution to its
shareholders of 496,296 shares of the AspenBio Pharma, Inc., ("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 the 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 of $475,000 for financial reporting purposes. 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 the Company's
status as not being in compliance with the reporting requirements under the
Investment Company Act, and 2) the board of directors did not believe that the
market value of the shares of the Company reflected the value of the underlying
investments and therefore to increase the value to its shareholders.


                                       4
<PAGE>
Commencing in December 2001, the Company made a series of investments in
AspenBio. At June 30, 2009 the Company owned 293,487 common shares of AspenBio.
In April 2007, the Company exercised common stock purchase warrants for cash
resulting in the issuance of 128,571 shares of AspenBio's common stock. The
Company thereupon sold 100,000 shares of AspenBio common stock for approximately
$445,000 in cash in order to reduce the level of its investment assets. Greg
Pusey, president of the Company, serves as vice-chairman of AspenBio's 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
scheduled to be redeemed for nominal value or were scheduled to expire.

Commencing in March 2002, the Company made a series of investments in
PepperBall. PepperBall, 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 3,003
shares of PepperBall's common stock and publicly traded warrants to purchase
5,000 shares of PepperBall's common stock. Greg Pusey, president of the Company,
serves on PepperBall's board of directors and Jeffrey G. McGonegal, chief
financial officer of the Company, serves as PepperBall'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. The larger valued
AspenBio warrants were nearing expiration and the Company determined that the
best course of action to enhance shareholder value 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. Approximately $445,000
in cash was thereupon generated by selling 100,000 of the AspenBio common
shares.

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 PepperBall. 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, 2010.


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.

                                       5
<PAGE>
Item 1A. RISK FACTORS

An investment in our common stock involves a high degree of risk. Prospective
investors should consider carefully the following factors and other information
in this report before deciding to invest in shares of our common stock. If any
of the following risks actually occur, our business, financial condition,
results of operations and prospects for growth would likely suffer. As a result,
the trading price of our common stock could decline and you could lose all or
part of your investment.

                         Risks Related to Our Business
                         -----------------------------

Following an inquiry by the SEC in 2005 regarding if the Company met the
definition of an investment company under the Investment Company Act, we
subsequently determined that we did meet that definition and liquidated our
assets under a plan of liquidation, but the SEC may determine that further
actions may be needed under that plan of liquidation.

We received correspondence from the SEC in 2005 asking, among other points,
whether we should be registered as an investment company under the Investment
Company Act. Immediately following our receipt of the SEC's correspondence, we
consulted with our legal counsel about the Investment Company Act issues raised
by the SEC's letter. Our management and board of directors 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. During multiple meetings, our board of
directors reviewed and discussed the information that management had gathered.
After such discussions, on June 9, 2005, the board 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. 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.

Our investments are concentrated primarily in the stock of AspenBio Pharma, Inc.

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.

We have limited operations and may require additional capital in the future, and
we cannot assure you that capital will be available on reasonable terms, if at
all, or on terms that would not cause substantial dilution to your stock
holdings.

We are in the process of liquidating the Company and distributing substantially
all of the Company's cash and investment assets and as such have limited
operations. We have historically generated capital from operating and investment
activities and periodically raised capital to fund our operating losses. We
expect to continue to incur operating losses into the 2009-10 fiscal year.
Depending upon our capital requirements, we may require additional capital.
There can be no assurance that such capital will be available in sufficient
amounts or on terms acceptable to us, if at all, especially in light of the
state of the current financial markets. Any sale of a substantial number of
additional shares may cause dilution to your investment and could also cause the
market price of our common stock to decline.



                                        6
<PAGE>

                        Risks Related to Our Securities
                        -------------------------------

We may require additional capital in the future and we cannot assure you that
capital will be available on reasonable terms, if at all, or on terms that would
not cause substantial dilution to your stock holdings.

We have historically generated capital from operating and investment activities
and periodically raised capital to fund our operating losses. We expect to
continue to incur operating losses into the 2009-10 fiscal year. Depending upon
our capital requirements, we may require additional capital. There can be no
assurance that such capital will be available in sufficient amounts or on terms
acceptable to us, if at all, especially in light of the state of the current
financial markets. Any sale of a substantial number of additional shares may
cause dilution to your investment and could also cause the market price of our
common stock to decline.

Our stock price, like that of many micro-cap companies, is volatile.

The market prices for securities of micro-cap companies in general have been
highly volatile and may continue to be highly volatile in the future,
particularly in light of the current financial markets. In addition, the market
price of our common stock has been and may continue to be volatile.

Item 1B.  UNRESOLVED STAFF COMMENTS

Not applicable.

Item 2.   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.

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.

None.

                                     PART II

Item 5.   MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS
          AND ISSUER PURCHASES OF EQUITY SECURITIES.

The Company's $.025 par value common stock trades on the OTC 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, 2009 and
2008 are as follows:

    Quarter Ended                High Bid            Low Bid
    --------------------------------------------------------
    June 30, 2009                  $.10               $.07
    March 31, 2009                 $.42               $.07
    December 31, 2008              $.42               $.42
    September 30, 2008            $.705               $.25
    June 30, 2008                  $.40               $.17
    March 31, 2008                 $.60               $.40
    December 31, 2007              $.56               $.18
    September 30, 2007             $.18               $.17


                                       7
<PAGE>
At September 24, 2009, the number of record holders of the Company's common
stock was approximately 931 (excluding an indeterminable number of shareholders
whose shares are held in street or "nominee" name).

The closing price of our common stock on September 24, 2009 was $0.10 per share.
During the last two fiscal years we have not paid any dividend on any class of
equity securities. We currently do not anticipate any cash dividends will be
paid to stockholders.

Equity Compensation Plan Information

The Company currently has one equity compensation plan. The Company currently
provides stock-based compensation to employees, directors and consultants, under
the 2001 Stock Option Plan (the "Plan"). The Plan has been approved by the
Company's shareholders and provides for up to 650,000 common shares to be
reserved for issuance. Stock options granted under the Plan generally vest over
periods of up to three years from the date of grant, as specified in the Plan or
by the compensation committee which function is fulfilled by the full board of
the Company's board of directors, and are exercisable for a period of up to ten
years from the date of grant.

The following table gives information about the Company's common stock that may
be issued upon the exercise of options and rights under the Company's
compensation plan as of December 31, 2008.
<TABLE>
<CAPTION>

                                         Number of
                                         securities        Weighted average       Number of
                                        to be issued          exercise           securities
                                       upon exercise          price of           remaining
                                       of outstanding        outstanding       available for
Plan Category                             options              options        future issuance
----------------------------------     --------------      ---------------    ---------------
<S>                                          <C>            <C>                      <C>
Equity compensation plans approved
  by security holders                        250,000        $       0.44             400,000

Equity compensation plans not
  approved by security holders                    --                  --                  --
                                         -----------        ------------         -----------
Total                                        250,000        $       0.44             400,000
                                         ===========        ============         ===========
</TABLE>


Recent Sales of Unregistered Securities

None.

Item 6.   SELECTED FINANCIAL DATA

Not applicable.

Item 7.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
          RESULTS OF OPERATION.


LIQUIDITY AND CAPITAL RESOURCES.

At June 30, 2009, the Company had cash and cash equivalents of $60,100 and
working capital of $644,400.


                                       8
<PAGE>
For the year ended June 30, 2009, operating activities consumed cash of $17,500
as compared to cash used of $88,600 for the year ended June 30, 2008. Net losses
totaled $827,800 for the year ended June 30, 2009, including noncash unrealized
gains from trading securities totaling $1,093,300. There were no realized gains
from the sale of investment securities for the years ended June 30, 2009 or
2008. Deferred tax liability increased by $437,000 in 2009 to a total of
$215,000, associated with the change in the unrealized losses on investment
securities.

There were no investing activities during the years ended June 30, 2009 or 2008.

Cash flows from financing activities used $75,000 in the year ended June 30,
2008. Debt issued in 2007 for $75,000 was repaid in 2008. There were no
financing activities in the year ended June 30, 2009.

RESULTS OF OPERATIONS.

FISCAL YEAR ENDED JUNE 30, 2009 COMPARED TO FISCAL YEAR ENDED JUNE 30, 2008

The Company had unrealized losses on investments of $1,093,300 and dividend
income of $500 totaling net negative revenues of $1,092,800 for the year ended
June 30, 2009. The Company had revenues of $492,400 in the year ended June 30,
2008 of which $486,300 was unrealized gains on investments and $6,100 was
interest and dividend income.

During the years ended June 30, 2009 and 2008, the Company incurred operating,
general and administrative costs of approximately $196,000 and $99,300,
respectively. The increase in 2009 related primarily to $96,100 recorded for the
stock-based compensation expense. The Company had losses before taxes of
$1,288,800 for the year ended June 30, 2009 as compared with income of $393,100
for the year ended June 30, 2008.

INCOME TAXES

Income tax benefit totaled $461,000 in the year ended June 30, 2009 and income
tax expense totaled $170,400 in the year ended June 30, 2008 primarily due to
the unrealized decrease in market value of investments.

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 invested 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, 2009, $783,800 of the Company's assets consisted of
such investments.


                                       9
<PAGE>
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 consisting of gains and losses on investment securities fluctuate
based on market value. These unrealized gains and losses on sales of investment
securities accounted for a material portion of total revenues during the years
ended June 30, 2009 and 2008. The SEC's Staff Accounting Bulletin (SAB) No. 104,
"Revenue Recognition" ("SAB No. 104") 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.

Stock-Based Compensation

SFAS No. 123(R), "Share-Based Payment", defines the fair-value-based method of
accounting for stock-based employee compensation plans and transactions used by
the Company to account for its issuances of equity instruments to record
compensation cost for stock-based employee compensation plans at fair value as
well as to acquire goods or services from non-employees. Transactions in which
the Company issues stock-based compensation to employees, directors and advisors
and for goods or services received from non-employees are accounted for based on
the fair value of the equity instruments issued. The Company utilizes pricing
models in determining the fair values of options and warrants issued as
stock-based compensation. These pricing models utilize the market price of the
Company's common stock and the exercise price of the option or warrant, as well
as time value and volatility factors underlying the positions.

Item 7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable.

Item 8.    FINANCIAL STATEMENTS. Pages F1 - F13

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

None.


Item 9A(T).  CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures.

                                       10
<PAGE>
In connection with the SEC's regular review of the Company's filings under the
Exchange Act, 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. 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 June 30, 2009. 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.

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.

As of the end of the period covered by this report, we carried out an
evaluation, under the supervision and with participation of management,
including our chief executive officer and chief financial officer, of the
effectiveness of our disclosure controls and procedures, as such term is defined
under Rules 13a-15(e) and 15d-15(e) promulgated under the Exchange Act. Based
upon that evaluation, our chief executive officer and chief financial officer
concluded that our disclosure controls and procedures were not effective, as of
the end of the period covered by this report, to provide reasonable assurance
that material information required to be disclosed by us in reports that we file
or submit under the Exchange Act is recorded, processed, summarized and reported
within the time periods specified in SEC rules and forms.

In making this evaluation, our chief executive officer and chief financial
officer considered the material weaknesses discussed in Management's Annual
Report on Internal Control Over Financial Reporting. Based on this evaluation,
we concluded that our disclosure controls and procedures were not effective at a
reasonable assurance level as of June 30, 2009 because of the identification of
material weaknesses in our internal control over financial reporting. The lack
of an effective control environment has been identified as a material weakness
contributing to the inadequacy of the Company's disclosure controls and
procedures as further discussed below with respect to the weaknesses in the
Company's internal control over financial reporting.

                                       11
<PAGE>
Management's Annual Report on Internal Control Over Financial Reporting
-----------------------------------------------------------------------

Management is responsible for establishing and maintaining adequate internal
control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and
15d-15(f)). Internal control over financial reporting is the process designed
by, or under the supervision of, our chief executive officer and chief financial
officer, and effected by our board of directors, management and other personnel,
to provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles ("GAAP").

All internal control systems, no matter how well designed, have inherent
limitations, including the possibility of the circumvention or overriding of
controls. Therefore, even a system determined to be effective can provide only
reasonable assurance with respect to financial statement preparation and
presentation. Further, because of changes in conditions, internal control
effectiveness may vary over time.

Management conducted an assessment of the effectiveness of the Company's
internal control system as of June 30, 2009. In making this assessment,
management used the criteria set forth in Internal Control -- Integrated
Framework issued by the Committee of Sponsoring Organizations of the Treadway
Commission ("COSO"). Based on this assessment, management has concluded that
internal control over financial reporting was not effective as of June 30, 2009.

A material weakness is a deficiency, or a combination of deficiencies, that
result in a reasonable possibility that a material misstatement of the annual or
interim financial statements will not be prevented or detected. Management
identified the following material weaknesses in our internal control over
financial reporting as of June 30, 2009.


Ineffective Control Environment

The Company did not maintain an effective control environment based on criteria
established in the COSO framework. Specifically, the Company did not adequately
design in an effective manner the procedures necessary to support the
requirements of the financial reporting and closing process.

Our evaluation concluded that, although policies and procedures appropriate for
operating control activities were designed, and in part instituted, the Company
has not been successful in designing and implementing polices for the control
environment. The control environment sets the tone of an organization,
influences the control consciousness of its people, and is the foundation of all
other components of internal control over financial reporting. A material
weakness in the control environment affects all other internal control
components.

We have also identified conditions as of June 30, 2009 that we believe are
significant deficiencies in internal controls that include a lack of segregation
of duties in accounting and financial reporting activities. We have been able to
mitigate this deficiency by other management personnel reviewing bank accounts
and transactions, financial reports and other information, but believe that the
only effective long-term solution to our accounting needs is to hire additional
personnel. Due to our budgetary constraints, we are uncertain as to when or if
we will be able to accomplish this.

We do not believe that these deficiencies constitute material weaknesses because
of the secondary reviews of information that are employed.

Management believes these deficiencies in internal control did not result in
material inaccuracies or omissions of material fact and, to the best of its
knowledge, believes that the financial statements for the year ended June 30,
2009 fairly present in all material respects the financial condition and results
of operations for the Company in conformity with GAAP. There is however, a
reasonable possibility that a material misstatement of the annual or interim
financial statements would not have been prevented or detected as a result of
the control environment weaknesses.

                                       12
<PAGE>
Changes in Internal Control Over Financial Reporting
----------------------------------------------------

There were no changes in the Company's internal control over financial reporting
as of June 30, 2009 that materially affected, or are reasonably likely to
materially affect, the Company's internal control over financial reporting.

Management is continuing to consider corrective action to remedy the internal
control weaknesses described above. See "Remediation of Material Weaknesses in
Internal Control over Financial Reporting" described below.

Remediation of Material Weaknesses in Internal Control over Financial Reporting
-------------------------------------------------------------------------------

Management is committed to remediating each of the material weaknesses
identified above by implementing changes to the Company's internal control over
financial reporting. Management continues to implement changes to the Company's
internal control systems and procedures to ensure additional controls and timely
reviews of information are improving.

Management is committed to creating and implementing an effective internal
control system for each of the five internal control components set forth in the
Internal Control -- Integrated Framework issued by COSO. In this regard, we
consult with legal and accounting professionals to support us in the development
of internal controls that are built into our business infrastructure and part of
the everyday consciousness of our organization.

This annual report does not include an attestation report of the Company's
registered public accounting firm regarding internal control over financial
reporting. Management's report was not subject to attestation by the Company's
registered public accounting firm pursuant to temporary rules of the SEC that
permit the Company to provide only management's report in this annual report.

There have been no significant changes made in our internal controls or in other
factors that have significantly affected internal controls subsequent to the
evaluation date.

Item 9B.   OTHER INFORMATION.

None.


                                       13
<PAGE>
                                    PART III

Item 10.   DIRECTORS AND EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
<TABLE>
<CAPTION>

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

<S>                     <C>     <C>       <C>
Gregory Pusey           57      1982      President, treasurer and director. Mr. Pusey is a director
                                          of Bactolac Pharmaceutical, Inc. a privately-held
                                          manufacturer of nutraceuticals. Mr. Pusey is also
                                          vice-chairman and a director of AspenBio Pharma, Inc., a
                                          publicly held emerging bio-pharmaceutical company, and
                                          serves on the board of directors of PepperBall Technologies,
                                          Inc. Mr. Pusey graduated from Boston College in 1974 with a
                                          BS in finance.


Scott Menefee           44      1993      Director. Mr. Menefee is the vice president 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    58      2000      Senior vice president-finance, secretary and director. Mr.
                                          McGonegal served as senior vice president -finance of
                                          Bactolac Pharmaceuticals, Inc., from February 2000 to 2006.
                                          Mr. McGonegal also has served as chief financial officer for
                                          PepperBall Technologies, Inc., since 2003 and as
                                          PepperBall's chief executive officer from October 2007 until
                                          September 2008. He has also served as the chief financial
                                          officer of AspenBio Pharma, Inc., since 2003. Since 1997,
                                          Mr. McGonegal has served as managing director of McGonegal
                                          and Co., a company engaged in providing accounting and
                                          business consulting services. Since 2005 Mr. McGonegal also
                                          has served on the board of Imagenetix, Inc., a publicly held
                                          company in the nutritional supplements industry. In
                                          September 2008 he was appointed to serve on the board of
                                          Smart Move, Inc., a publicly held company in the
                                          transportation industry until his resignation in January
                                          2009. 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>


                                       14
<PAGE>
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.

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
Exchange Act with respect to the fiscal year of the Company ended June 30, 2009.

The Company has not adopted a code of ethics and does not have a separately
designated audit committee or audit committee financial expert. The entire board
serves as the compensation committee.

If security holders wish to communicate with the board of directors or with an
individual director, they may direct such communications in care of the
president, Cambridge Holdings, Ltd., 106 S. University Blvd, #14 Denver, CO
80209. The communication must be clearly addressed to the board of directors or
to a specific director. The board of directors has instructed the president to
review and forward any such correspondence to the appropriate person or persons
for response.


Item 11.  EXECUTIVE COMPENSATION.

The Company's compensation philosophy is to manage its resources prudently by
paying minimal compensation for management's routine annual services. It incents
its executives with stock options and pays additional incentive payments for
achieving specific objectives and results.

COMPENSATION.

The following table sets forth the cash compensation paid by the Company during
the fiscal year ended June 30, 2009 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.

                           Summary Compensation Table

                        Annual Compensation            Awards
                     ------------------------------    ------
Name and                              Other Annual                   All Other
Principal            Fiscal    Salary   Compensa-      Options       Compensa-
Position              Year     ($)(1)    tion(2)         ($)        tion($)(3)
                      ----     ------    -------         ---        ----------
Gregory Pusey,
President             2009     46,000    14,000        35,500           -0-
                      2008     38,000    22,000          -0-            -0-
                      2007     60,000      -0-           -0-           7,725

(1) The dollar value of base salary (cash) received. (No non-cash base salary
was paid during the period covered by this table). Mr. Pusey's current salary is
$60,000 per year. On September 5, 2008, Mr. Pusey was granted options to acquire
100,000 shares of common stock exercisable at $0.462 each, vested upon issuance
and expiring in five years. The options had a value based upon the Black-Scholes
formula under assumptions as included with the accompanying financial statements
of $35,500.

                                       15
<PAGE>
(2) Other annual compensation in 2009 consists of cash payments taken as
contract income in lieu of salary.

(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 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.


OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END

At June 30, 2009, our named executive officer, Greg Pusey had options, issued
under our 2001 Stock Incentive Plan (the "2001 Plan") to purchase 100,000 shares
of our common stock at an exercise price of $0.462 each. The options are 100%
vested and expire September 5, 2013.


DIRECTOR COMPENSATION

Our directors do not receive any cash compensation for serving on the board of
directors. During the year ended June 30, 2009, Jeffrey McGonegal and Scott
Menefee were granted options under our 2001 Plan to purchase totaling 100,000
and 50,000 shares, respectively, of our common stock at an exercise price of
$0.42 each and a total estimated value of $60,600. During the year ended June
30, 2009, Gregory Pusey was granted options under our 2001 Plan to purchase
100,000 shares of our common stock at an exercise price of $0.46 per share and
an estimated value of $35,500. These options are 100% vested and expire
September 5, 2018.


Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
         RELATED STOCKHOLDER MATTERS.

                             PRINCIPAL SHAREHOLDERS
                             ----------------------

The following table sets forth as of August 28, 2009 the beneficial ownership of
our common stock, by (i) each person or group of persons known to us to
beneficially own more than 5% of the outstanding shares of our voting stock,
(ii) each of our director and executive officers; and (iii) all of our executive
officers and directors as a group.

Except as indicated in the footnotes to the table below, each shareholder named
in the table has sole voting and investment power with respect to the shares
shown as beneficially owned by such shareholder.

Beneficial ownership is determined in accordance with Rule 13d-3 under the
Exchange Act. In computing the number of shares beneficially owned by a person
or a group and the percentage ownership of that person or group, shares of our
common stock subject to options or warrants currently exercisable or exercisable
within 60 days after the date hereof are deemed outstanding, but are not deemed
outstanding for the purpose of computing the percentage ownership of any other
person. As of August 28, 2009, we had 3,509,877 shares of common stock
outstanding. Unless otherwise indicated, the address of each individual named
below is the address of the Company, 106 S. University Blvd., #14, Denver, CO
80209.


                                       16
<PAGE>




                                                    Amount and
                                                     Nature of
                                                    Beneficial        Percent
     Name of Beneficial Owner                        Ownership       of Class
-----------------------------------------------------------------------------
  Executive Officers and Directors
  --------------------------------

Gregory Pusey (1)                                   1,772,418          49.1%
Jeffrey G. McGonegal (2)                              241,075           6.7%
Scott Menefee (3)                                     152,430           4.3%
All executive officers and directors
 as a group (three persons) (4)                     2,165,923          60.1%


       5% Shareholders
       ---------------

The Peierls Foundation, Inc. (5)
c/o John Kennedy
US Trust Company
114 West 47th Street
New York, NY 10036                                    701,048           20.0%


(1)  Includes 100,000 shares of common stock issuable at $0.462 per share upon
     the exercise of stock options that expire in September 2013. Also includes
     36,000 shares of common stock owned by Mr. Pusey's IRA. Includes 7,600
     shares of common stock owned by his wife and 39,709 held in his wife's IRA.
     Mr. Pusey disclaims beneficial ownership of the shares held by his wife
     except to the extent of his pecuniary interest therein.

(2)  Includes 100,000 shares of common stock issuable at $0.42 per share upon
     the exercise of stock options that expire in September 2018.

(3)  Includes 50,000 shares of common stock issuable at $0.42 per share upon the
     exercise of stock options that expire in September 2018.

(4)  Includes footnotes 1 to 3.

(5)  Includes 14,400 shares of common stock beneficially owned by E. Jeffrey
     Peierls and 219,011 shares of common stock beneficially owned by Brian
     Eliot Peierls, E. Jeffrey Peierls' brother.

                                       17
<PAGE>
                               CHANGES IN CONTROL

        There are no arrangements known to the Company which may result in a
change in control of the Company.

        SECURITIES AUTHORIZED UNDER EQUITY COMPENSATION PLANS INFORMATION

In October 2001, the board of directors of the Company adopted the 2001 Plan.
The 2001 Plan was approved by majority vote of the shareholders in May 2002. The
2001 Plan authorizes the grant of options to purchase up to 650,000 shares of
the Company's common stock. During the year ended June 30, 2009, options to
purchase 250,000 shares of the Company's common stock were issued to the
Company's directors.

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, 2009.
<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>             <C>
Equity Compensation Plans
Approved by Stockholders         250,000          $0.44             400,000         650,000

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

TOTAL                            250,000         $  0.44            400,000         650,000

</TABLE>



Item 13.  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 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.


Commencing in December 2001, the Company made a series of investments in
AspenBio. At June 30, 2009 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 vice-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. Other than any value derived from the related party's holdings as a
shareholder of the Company, the related party had no interest in the above
transactions.

                                       18
<PAGE>

Commencing in March 2002, the Company made a series of investments in
PepperBall. PepperBall, 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 3,003
common shares and publicly tradable warrants in PepperBall that are exercisable
for 5,000 shares of PepperBall's common stock, with virtually no value. Greg
Pusey, president of the Company, serves on PepperBall's board of directors and
Jeffrey G. McGonegal, chief financial officer of the Company, serves as
PepperBall's chief financial officer. Other than any value derived from the
related party's holdings as a shareholder of the Company, the related party had
no interest in the above transactions.

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. The full board serves in all committee functions and Gregory Pusey and
Jeff McGonegal have been determined to not be independent.

Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

     (a) Audit Fees. During the fiscal years ended June 30, 2009 and 2008, the
aggregate fees billed by the Company's 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-Q for services provided
in connection with the statutory and regulatory filings or engagements for those
fiscal years, were $9,000 and $8,500 per year, respectively.

     (b) Audit-Related Fees. During fiscal years ended June 30, 2009 and 2008
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, 2009 and 2008.






                                       19

<PAGE>





                                     PART IV


Item 15.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.

     (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. Filed herewith.

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

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





                                       20
<PAGE>





                                   SIGNATURES

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

                            CAMBRIDGE HOLDINGS, LTD.


Date: September 28, 2009                   By: /s/ Gregory Pusey
                                               -----------------
                                               Gregory Pusey
                                               President, Treasurer and Director

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


Date: September 28, 2009                   By: /s/ Gregory Pusey
                                               -----------------
                                               Gregory Pusey
                                               President, Treasurer and Director



Date: September 28, 2009                   By: /s/ Jeffrey G. McGonegal
                                               ------------------------
                                               Jeffrey G. McGonegal
                                               Senior Vice President-Finance,
                                               Secretary and Director


Date: September 28, 2009                   By: /s/ Scott Menefee
                                               -----------------
                                               Scott Menefee, Director





                                       21


<PAGE>



                          Index to Financial Statements
                                                                       Page


Report of Independent Registered Public Accounting Firm                F-2

Balance Sheets                                                         F-3

Statements of Operations                                               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



To the Board of Director and Shareholders
Cambridge Holdings, Ltd.:


We have audited the accompanying balance sheets of Cambridge Holdings, Ltd. as
of June 30, 2009 and 2008, and the related statements of operations and
comprehensive income (loss), changes in stockholders' equity and cash flows for
the years ended June 30, 2009 and 2008. 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. The Company is not required to
have, nor were we engaged to perform, an audit of its internal control over
financial reporting. Our audit included consideration of internal control over
financial reporting as a basis for designing audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's internal control over financial
reporting. Accordingly, we express no such opinion. An audit includes examining,
on a test basis, evidence supporting the amounts and disclosures in the
financial statements, 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, 2009 and 2008, and the results of its operations and its cash flows for
the years ended June 30, 2009 and 2008 in conformity with accounting principles
generally accepted in the United States of America.




/s/ Cordovano and Honeck LLP
----------------------------
Cordovano and Honeck LLP
Englewood, Colorado
September 24, 2009



                                      F-2
<PAGE>

<TABLE>
<CAPTION>

                            CAMBRIDGE HOLDINGS, LTD.
                                 BALANCE SHEETS
                             JUNE 30, 2009 and 2008



                                                                    2009           2008
                                                                -----------    -----------
<S>                                                             <C>            <C>
                                     ASSETS
                                     ------

CURRENT ASSETS:
     Cash and cash equivalents                                  $    60,109    $    77,605
     Investment securities (Note 2)                                 783,836      1,877,121
     Prepaid and other assets                                        17,216         74,100
                                                                -----------    -----------

                  Total current assets                              861,161      2,028,826

Property and equipment, net (Note 3)                                  4,280          7,209
                                                                -----------    -----------
                                                                $   865,441    $ 2,036,035
                                                                ===========    ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------

CURRENT LIABILITIES:
     Accounts payable and accrued expenses                      $     1,808    $     3,727
     Deferred income tax liability (Note 6)                         215,000        652,000
                                                                -----------    -----------

                  Total current liabilities                         216,808        655,727
                                                                -----------    -----------

COMMITMENTS AND CONTINGENCIES


STOCKHOLDERS' EQUITY:
     Common stock, $.025 par value; 15,000,000 shares
       authorized: 3,509,877 issued and outstanding each year        87,747         87,747
     Additional paid-in capital                                   1,803,232      1,707,132
     Accumulated (deficit)                                       (1,242,346)      (414,571)
                                                                -----------    -----------

                                                                    648,633      1,380,308
                                                                -----------    -----------


                  Total stockholders' equity                    $   865,441    $ 2,036,035
                                                                ===========    ===========
</TABLE>


                 SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS

                                      F-3

<PAGE>
<TABLE>
<CAPTION>

                            CAMBRIDGE HOLDINGS, LTD.
                            STATEMENTS OF OPERATIONS



                                                       For the Years Ended June 30,
                                                ----------------------------------------
                                                       2009                   2008
                                                ------------------    ------------------
<S>                                             <C>                   <C>
REVENUES:

     Net unrealized gains (losses)              $       (1,093,285)   $          486,279
     Interest, dividend and other income                       534                 6,073
                                                ------------------    ------------------

                  Total revenues                        (1,092,751)              492,352
                                                ------------------    ------------------


OPERATING EXPENSES:
     Operating, general and administrative                 196,024                99,283
                                                ------------------    ------------------



NET INCOME (LOSS) BEFORE INCOME TAX EXPENSE             (1,288,775)              393,069

     Income Tax Benefit (Note 6)                           461,000              (170,400)
                                                ------------------    ------------------

NET INCOME (LOSS)                               $         (827,775)   $          222,669
                                                ==================    ==================


NET INCOME (LOSS) PER COMMON SHARE, BASIC AND
        DILUTED                                 $            (0.24)   $             0.06
                                                ==================    ==================

Weighted average number of basic and diluted
     common shares outstanding                           3,509,877             3,509,877
                                                ==================    ==================
</TABLE>


                 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, 2009 AND 2008



                                                              Additional                      Total
                                         Common Stock           Paid-in     Accumulated    Stockholders'
                                     Shares        Amount       Capital      (Deficit)        Equity
                                  -----------   -----------   -----------   -----------    -----------
<S>                                 <C>         <C>           <C>           <C>            <C>
Balances, June 30, 2007             3,509,877   $    87,747   $ 1,707,132   $  (637,240)   $ 1,157,639

      Net income for the year              --            --            --       222,669        222,669
                                  -----------   -----------   -----------   -----------    -----------

Balances, June 30, 2008             3,509,877        87,747     1,707,132      (414,571)     1,380,308

      Stock based compensation
            issued for services            --            --        96,100            --         96,100


       Net (loss) for the year             --            --            --      (827,775)      (827,775)
                                  -----------   -----------   -----------   -----------    -----------

Balances, June 30, 2009             3,509,877   $    87,747   $ 1,803,232   $(1,242,346)   $   648,633
                                  ===========   ===========   ===========   ===========    ===========

</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,
                                                              ----------------------------
                                                                  2009             2008
                                                              -----------      -----------

<S>                                                           <C>              <C>
CASH FLOWS FROM (TO) OPERATING ACTIVITIES:
Net income (loss)                                             $  (827,775)     $   222,669
  Adjustments to reconcile net income (loss) to net cash
     provided (used) by operating activities:
       Depreciation and amortization                                2,852            3,192
       Unrealized (gains)losses on trading investment
           securities                                           1,093,285         (486,280)
       (Increase) decrease in deferred income tax expense        (437,000)         194,000
       Stock-based compensation                                    96,100               --
       Realized loss on fixed asset sale                               76               --
  Changes in:
       Prepaid and other assets                                    56,885          (18,138)
       Accounts payable and accrued expenses                       (1,919)          (4,081)
                                                              -----------      -----------

         Cash Flows (Used) By Operating Activities                (17,496)         (88,638)
                                                              -----------      -----------

CASH FLOWS FROM (TO) INVESTING ACTIVITIES:

         Cash Flows (Used) By Investing Activities                     --               --
                                                              -----------      -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
  Repayment of debt                                                    --          (75,000)
                                                              -----------      -----------

         Cash Flows Provided (Used) By Investing Activities            --          (75,000)
                                                              -----------      -----------


NET (DECREASE) IN CASH AND CASH EQUIVALENTS                       (17,496)        (163,638)

CASH AND CASH EQUIVALENTS, beginning of year                       77,605          241,243
                                                              -----------      -----------

CASH AND CASH EQUIVALENTS, end of year                        $    60,109      $    77,605
                                                              ===========      ===========

SUPPLEMENTAL CASH FLOW INFORMATION:
  Cash paid during the year for:
     Interest                                                 $        --      $     1,632
                                                              ===========      ===========
     Income taxes                                             $        --      $        --
                                                              ===========      ===========
</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
-------------------------

BUSINESS DEVELOPMENT. Cambridge Holdings, Ltd. (the "Company," "we" "us,"
"our"), 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 United States Securities and Exchange Commission's (the
"SEC") regular review of our filings under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), we received correspondence from the SEC asking,
among other points, whether we should be registered as an investment company
under the Investment Company Act. 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 the SEC's correspondence, 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 of directors have undertaken numerous discussions to
investigate and explore the best course of action. Based upon the investigation
undertaken by our management and board of directors, 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, on June 9,
2005, the board 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. 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.

Management of the Company is currently evaluating the most prudent methods and
timing of liquidating the remaining investments held by the Company in AspenBio
Pharma, Inc. ("AspenBio") and its minor holding in PepperBall Technologies, Inc.
("PepperBall"). 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,
2010.

                                      F-7
<PAGE>

                            CAMBRIDGE HOLDINGS, LTD.
                          NOTES TO FINANCIAL STATEMENTS

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.

Under generally accepted accounting principles, fair value of such securities is
determined based upon a hierarchy that prioritizes the inputs to valuation
techniques used to measure fair values into three broad levels. Inputs generally
are summarized as; Level I are available quoted prices in active markets, Level
II are other than available quoted market prices that are observable for the
investment and Level III are unobservable inputs for the investment. The Company
uses Level I inputs to value its investment securities.

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, 2009, the Company's
cash in financial institutions was $60,100.

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 $2,852 and $3,192 for the years ended June 30,
2009 and 2008, respectively.

Income Taxes
------------
The Company follows the provisions of Statement of Financial Accounting
Standards ("SFAS") No. 109 - Accounting for Income Taxes ("SFAS No. 109"). 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.

The Company has adopted the provisions of FASB Interpretation No. 48 ("FIN 48"),
Accounting for Uncertainty in Income Taxes, an interpretation of SFAS No. 109.
As a result of the implementation of FIN 48, the Company had no changes in the
carrying value of its tax assets or liabilities for any unrecognized tax
benefits.

                                      F-8
<PAGE>

                            CAMBRIDGE HOLDINGS, LTD.
                          NOTES TO FINANCIAL STATEMENTS

Subsequent Events
-----------------
The Company has evaluated all subsequent events through September 24, 2009, the
date the financial statements were issued, and no additional items were noted
that need to be disclosed.

Earnings Per Common Share
-------------------------
The Company computes earnings per common share in accordance with SFAS No. 128,
Earnings Per Share ("SFAS No. 128"). SFAS No. 128 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, SFAS No. 128 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 effect of the inclusion of the
dilutive shares in 2009 would have resulted in a decrease in loss per share.
Accordingly, the weighted average shares outstanding have not been adjusted for
dilutive shares. Outstanding stock options are not considered in the
calculation, as the impact of the potential common shares (totaling 250,000
shares for the year ended June 30, 2009) would be to decrease the net loss per
share. The Company had no dilutive instruments outstanding in 2008.

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 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). During 2008 the Company did not issue any
rights accounted for under these provisions.


Recently Issued and Adopted Accounting Pronouncements
-----------------------------------------------------
In December 2007, the Financial Accounting Standards Board ("FASB") issued SFAS
No. 141 (R), "Business Combinations" ("SFAS No. 141") which becomes effective
for fiscal periods beginning after December 15, 2008. The standard changes the
accounting for business combinations, including the measurement of acquirer
shares issued in consideration for a business combination, the recognition of
contingent consideration, the accounting for pre-acquisition gain and loss
contingencies, the recognition of capitalized in-process research and
development, the accounting for acquisition-related restructuring cost accruals,
the treatment of acquisition related transaction costs, and the recognition of
changes in the acquirer's income tax valuation allowance. SFAS 141(R) became
effective for the Company in 2009. The Company will apply the provisions of SFAS
141 (R) to any future business combinations.

In December 2007, the FASB issued SFAS No. 160, "Non-controlling Interests in
Consolidated Financial Statements, an amendment of ARB No. 51" ("SFAS No. 160").
SFAS No. 160 changes the accounting for non-controlling (minority) interests in
consolidated financial statements, including the requirements to classify
non-controlling interests as a component of consolidated stockholders' equity,
and the elimination of minority interest accounting in results of operations
with earnings attributable to non-controlling interests reported a part of
consolidated earnings. Purchases and sales of non-controlling interests are to
be reported in equity similar to treasury stock transactions. SFAS No.160 became
effective for the Company in 2009. The adoption of this statement did not have
an impact on the Company's financial statements.

                                      F-9

<PAGE>

                            CAMBRIDGE HOLDINGS, LTD.
                          NOTES TO FINANCIAL STATEMENTS

In December 2007, the FASB ratified Emerging Issues Task Force ("EITF") No.
07-1, Accounting for Collaborative Arrangements ("EITF 07-1") defines
collaborative arrangements and establishes reporting requirements for
transactions between participants in a collaborative arrangement and between
participants in the arrangement and third parties. EITF 07-1 also establishes
the appropriate income statement presentation and classification for joint
operating activities and payments between participants, as well as the
sufficiency of the disclosures related to these arrangements. EITF 07-1 is
effective for the Company in 2009, and its adoption did not have a material
impact on the Company's financial statements.

In 2009, the Company adopted EITF Issue No. 07-5, "Determining Whether an
Instrument (or an Embedded Feature) Is Indexed to an Entity's Own Stock" ("EITF
07-5"), which requires the application of a two-step approach in evaluating
whether an equity-linked financial instrument (or embedded feature) is indexed
to our own stock, including evaluation of the instrument's contingent exercise
and settlement provisions. The adoption of EITF 07-5 did not have an impact on
the Company's financial statements.

In April 2009, the FASB issued FASB Staff Position SFAS 107-1 and Accounting
Principles Board 28-1, "Interim Disclosures about Fair Value of Financial
Instruments" ("FSP 107-1"), which will require that the fair value disclosures
required for all financial instruments within the scope of SFAS 107,
"Disclosures about Fair Value of Financial Instruments", be included in interim
financial statements. FSP 107-1 also requires entities to disclose the method
and significant assumptions used to estimate the fair value of financial
instruments on an interim and annual basis and to highlight any changes from
prior periods. FSP 107-1 is effective beginning with this period ending June 30,
2009. The adoption of FSP 107-1 did not have a material impact on the Company's
financial statements.

In June 2009, the FASB approved its Accounting Standards Codification
("Codification") as the single source of authoritative United States accounting
and reporting standards applicable for all non-governmental entities, with the
exception of the SEC and its staff. The Codification, which changes the
referencing of financial standards, is effective for interim or annual periods
ending after September 15, 2009. Therefore in the third quarter of fiscal year
2009, all references made to US GAAP will use the new Codification numbering
system prescribed by the FASB. As the Codification is not intended to change or
alter existing US GAAP, it is not expected to have any impact on the Company's
financial position or results of operations, upon adoption.

NOTE 2 - INVESTMENT SECURITIES

The Company classifies its investment securities as trading securities.
Investment securities held for trading and available-for-sale are reported at
their fair market value. Unrealized gains on trading investments are reported in
earnings.

At June 30, 2009, the Company's market value of trading securities consisted
primarily of securities with a fair market value of approximately $783,800 and a
cost of approximately $246,300. Included were 293,487 common shares of AspenBio
at a cost of approximately $237,100 and a fair market value of approximately
$783,600. The market value of AspenBio's common shares have historically been
volatile and are expected to continue that trend in the future. As of June 30,
2009 each AspenBio common share had a market price of $2.67 and at September 24,
2009 closed at $2.10. Management does not believe that this change represents a
permanent decline. Also included were 3,003 common shares and 5,000 common stock
purchase warrants of PepperBall at a cost of $9,200 and a fair market value of
$200.


                                      F-10
<PAGE>

                            CAMBRIDGE HOLDINGS, LTD.
                          NOTES TO FINANCIAL STATEMENTS

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.

NOTE 3 - PROPERTY AND EQUIPMENT

Property and equipment consisted of the following:

                                                              June 30,
                                                       2009              2008
                                                     --------          --------
Furniture and fixtures                               $ 10,027          $ 10,027
Office equipment                                        3,519             4,328
                                                     --------          --------

Total                                                  13,546            14,355
Less accumulated depreciation                          (9,266)           (7,146)
                                                     --------          --------

                                                     $  4,280          $  7,209
                                                     ========          ========


NOTE 4 - INCOME TAX EXPENSE (BENEFIT)

At June 30, 2009 and 2008 the Company had recorded a deferred tax liability of
$215,000 and $652,000, respectively, related to the difference in financial and
income tax reporting of the unrealized gains of the trading investment
securities.

Income tax expense (benefit) consisted of:

                                                    For the Years Ended June 30,
                                                       2009              2008
                                                    ---------         ---------
Current income taxes                                $(676,000)        $ (23,600)
Deferred income taxes                                 215,000           194,000
                                                    ---------         ---------
Income tax (benefit) expense                        $(461,000)        $ 170,400
                                                    =========         =========

Other than the statutory rate differences on the lower levels of taxable income,
the Company had no significant differences between the reported amount of income
tax expense and the applicable statutory amounts.


NOTE 5 - STOCK OPTIONS

2001 Stock Option Plan
----------------------

During the year ended June 30, 2009, options to purchase a total of 250,000
shares of the Company's common stock under the Company's 2001 Stock Option Plan
(the "Plan") were issued to the Company's directors. The options were fully
vested upon their grant, and options to purchase 150,000 shares of common stock
are exercisable at $0.42 and expire in ten years. Options to purchase 100,000
shares of common stock are exercisable at $0.462 and expire in five years.

                                      F-11
<PAGE>

                            CAMBRIDGE HOLDINGS, LTD.
                          NOTES TO FINANCIAL STATEMENTS

The Company currently provides stock-based compensation to employees, directors
and consultants, under the Plan. The Plan has been approved by the Company's
shareholders and provides for up to 650,000 common shares to be reserved for
issuance. Stock options granted under the Plan generally vest over periods of up
to three years from the date of grant, as specified in the Plan or by the
compensation committee, which function is currently fulfilled by the full board
of the Company's board of directors, and are exercisable for a period of up to
ten years from the date of grant. The Company recognized stock-based
compensation during the year ended June 30, 2009 totaling $96,100.

The Company accounts for stock-based compensation 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). The Company estimated the fair value of
each stock option at the grant date by using the Black-Scholes option pricing
model with the following weighted average assumptions used for the grants in the
year ended June 30, 2009. Expected life; 5-10 years, Volatility, 126.3%,
Risk-free interest rate, 2.91% to 3.66%, Dividend yield, 0%, and estimated
forfeitures 0%.

The expected life of stock options represents the period of time that the stock
options granted are expected to be outstanding based on historical exercise
trends. The expected volatility is based on the historical price volatility of
the Company's common stock over the past nine years, based upon management's
assessment of the appropriate life to determine volatility. The risk-free
interest rate represents the U.S. Treasury bill rate for the expected life of
the related stock options. The dividend yield represents the Company's
anticipated cash dividend over the expected life of the stock options.
Forfeitures represent the weighted average estimate of future options to be
cancelled primarily due to terminations.

A summary of stock option activity of options to employees, directors and
advisors, for the year ended June 30, 2009 is presented below:


                                                           Weighted
                                             Weighted      Average
                                   Shares    Average       Remaining   Aggregate
                                   Under     Exercise     Contractual  Intrinsic
                                   Option     Price      Life (Years)     Value
                                  --------   --------    ------------   --------
Outstanding at June 30, 2008            --   $     --
     Granted                       250,000       0.44
     Exercised                          --         --
     Forfeited                          --         --
                                  --------   --------
Outstanding at June 30, 2009       250,000   $   0.44         7.4       $    --
                                  ========   ========                   =======

Exercisable at June 30, 2009       250,000   $   0.44         7.4       $    --
                                  ========   ========                   =======


                                      F-12
<PAGE>

                            CAMBRIDGE HOLDINGS, LTD.
                          NOTES TO FINANCIAL STATEMENTS

The aggregate intrinsic value in the table above represents the total intrinsic
value (the difference between our closing stock price on June 30, 2009 and the
exercise price, multiplied by the number of in-the-money options) that would
have been received by the option holders, had all option holders been able to
and in fact, had exercised their options on June 30, 2009.

During the year ended June 30, 2009, there were options to purchase 250,000
shares of common stock granted to directors under the Plan with a weighted
average fair value at the grant date of $0.38 per option exercisable at an
average of $0.44 per share.

As of June 30, 2009, based upon employee, advisor and consultant options granted
to that point, there was no additional unrecognized compensation cost related to
stock options that will be recorded in future periods.

NOTE 7 - RELATED PARTY TRANSACTIONS

The Company shares corporate office space and administrative staff with an
affiliate of the Company. The Company pays its affiliate $500 per month for
these facilities and services.

At June 30, 2009 the Company owned 293,487 common shares of AspenBio. This
holding included the April 2007 exercise for cash of warrants to purchase
128,571 AspenBio common shares. 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 vice-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, 2009 the Company owned 3,003 shares of PepperBall with a value of
approximately $200 and owned PepperBall common stock purchase warrants
exercisable for 5,000 shares of PepperBall common stock, with no value.

During the year ended June 30, 2009, Greg Pusey received compensation totaling
$60,000 for services.



                                      F-13
<PAGE>