UNITED STATES


SECURITIES AND EXCHANGE COMMISSION


Washington, D.C.  20549










Form 10-Q











xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE


SECURITIES EXCHANGE ACT OF 1934





For the quarterly period ended June 30, 2009





 ̈  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE


SECURITIES EXCHANGE ACT OF 1934





Commission File number 000-49679





GLOBAL ENTERTAINMENT HOLDINGS, INC.


(Exact name of registrant as specified in its charter)





Nevada

93-1221399(State or other jurisdiction of incorporation or organization)

(I.R.S. Employer Identification No.)





2375 E. Tropicana Ave., Suite 8-259Las Vegas, Nevada

89119(Address of principal executive offices)

(Zip Code)





(702) 516-9684(Registrant's telephone number, including area code)





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 preceding 12 months (or for such shorter period that the registrant as required to file such reports), and (2) has been subject to such filing requirements for the past
90 days.  Yes x No o





Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer.  See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.  (Check one):





Large accelerated filer           o
Accelerated filer                     oNon-accelerated filer             o
Smaller reporting company  x





Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act) YesoNo x





Check whether the registrant filed all documents and reports required to be filed by Section 12, 13 or 15(d) of the Exchange Act after the distribution of securities under a plan confirmed by a court.  Yes  x   No o





The number of shares of Common Stock, $0.001 par value, outstanding on July 31, 2009, was 21,912,844 shares.







Table of Contents





Global Entertainment Holdings Inc.





Table of Contents





PagePART I   Financial InformationItem 1.
Financial Statements
3Item 2.
Management's Discussion & Analysis of Financial Condition and Results of Operations
14Item 3.
Quantitative and Qualitative Disclosures about Market Risk
18Item 4.
Controls and Procedures
18PART II  Other InformationItem 1.
Legal Proceedings
19Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
19Item 3.
Defaults Upon Senior Securities
19Item 4.
Submission of Matters to Vote of Security Holders
19Item 5.
Other Information
19Item 6.
Exhibits
20Signatures
22





Table of Contents




PART I – FINANCIAL INFORMATION





ITEM 1A.   FINANCIAL STATEMENTS





Global Entertainment Holdings Inc.


Consolidated Balance Sheet





June 30,


December 31,2009


2008(unaudited)


(audited)AssetsCurrent assets:Cash and cash equivalents

$
3,468


$
2,553Note Receivable


121,500



160,000Accrued Interest Income


11,137



3,699Total current assets


136,105



165,952Fixed assets, net


17,134



16,714Total fixed assets


17,134



16,714Other assetsBook Rights


1,864



1,864TV Game / Reality Show


5,966



5,966Film Rights


189,175



189,175Movies


33,850



26,850Website Software: Less Amortization


3,000



4,000Other Assets


17,695



17,195Producer Investments


150,000



150,000Total other assets


401,550



395,050Total assets

$
553,220


$
577,716




3
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Global Entertainment Holdings Inc.


Consolidated Balance Sheet


(Continued)




June 30,


December 31,2009


2008(unaudited)


(audited)Liabilities and Stockholders' EquityLiabilities not subject to compromiseAccounts payable

$
86,690


$
69,824Accrued expenses


272,712



183,906Deferred revenue


150,000



150,000Notes payable


259,862



243,604Total current liabilities not subject to compromise


769,264



647,334Liabilities subject to compromiseDebentures


40,000



40,000Total  liabilities subject to compromise


40,000



40,000Total liabilities


809,264



687,334Stockholders' equity:Series B Convertible preferred stock, par value $0.001,4,000,000 shares authorized, 3,990,314 shares issued and outstanding


3,990



3,990Series C Convertible preferred stock par value $0.0016,500,000 shares authorized,  6,500,000 issued and outstanding


6,500Common stock, $0.001 par value, 230,000,000 sharesauthorized, 21,912,844 and 11,812,844 shares issued andoutstanding at  June 30, 2009 and December 31, 2008, respectively


104,832



94,282Shares authorized & unissued


10,000



200,000Additional paid-in capital


11,643,330



11,339,565Additional paid-in capital Preferred B


271,425



271,425Additional paid-in capital Preferred C






500Accumulated (deficit)


(12,296,121
)


(12,040,077
)(256,044
)


(109,618
)$
553,220


$
577,716





4
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Global Entertainment Holdings, Inc.
Consolidated Statement of Operations
Unaudited




Three months ended


Six months endedJune 30,


June 30,2009


2008


2009


2008Net Revenue

$
-


$
-Expenses:General and Administrative expenses


74,218



161,234



254,270



332,699Financing expense






39,821







55,421Depreciation & Amortization


2,069



1,746



4,139



3,759Total operating expenses


76,287



202,801



258,409



391,879Net operating (loss)


(76,287
)


(202,801
)


(258,409
)


(391,897
)Other income (expenses):Other income (expense)


5,000



(2,752
)


5,000



(2,729
)Interest (expense) net of interest income


(1,122
)


(3,521
)


(2,635
)


(6,536
)Amortization of debt discount














50,606Total other income (expenses)


3,878



(6,273
)


2,365



(9,265
)Income (Loss) before Gain on Debt Restructuring


(72,409
)


(209,074
)


(256,044
)


(401,144
)Gain on debt restructuring


-











26,250Income tax (benefit) provision


-



-Net Income (loss)

$
(72,409
)

$
(209,074
)


(256,044
)


(374,894
)Net (loss) per share – basic

$
(0.006
)

$
(0.019
)

$
(0.014
)

$
(0.04
)Before Extraordinary item


(0.006
)










(0.04
)Extraordinary item


-











0.003Total

$
(0.006
)





$
(0.014
)

$
(0.04
)Weighted average number ofcommon shares outstanding – basic


11,812,844



10,853,102



17,715,054



10,107,570




See notes to consolidated financial statements.




5
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Global Entertainment Holdings Inc.


Consolidated Statement of Cash Flows


Unaudited





For the Six months endedJune 30,2009


2008Cash flows from operating activitiesNet income (loss)

$
(256,044
)

$
(374,894
)Adjustments to reconcile net income to net cashprovided by (used in operating activities)Depreciation and amortization


4,139



3,759Reserve for unsuccessful resolution of lawsuitsShare-based compensation






220,664Changes in assets and liabilities:Increase (decrease) in account receivables


(38,500
)


(900
)Increase (decrease) in other assets


6,500



(45,964)Increase (decrease) in contingent advancesNotes receivable


150,000Debt discountDeferred stock compensationIncrease (decrease) in accounts payable and accrued expenses


101,062



19,812Trade and other claims subject to compromiseIncrease (decrease) in deferred revenueNet cash (used in) operating activities

$
(32,843
)


(177,523
)Cash flows from investing activities:Purchase of property and equipmentNet cash (used in) investing activitiesCash flows from financing activities:Cash from issuance of common stock


10,000



26,080Cash from exercise of options & warrants






100Common stock cancellationProceeds from notes payable


16,258



66,000Repayments of notes payable


5,000



46,000Proceeds from investor participation borrowingsPrincipal repayments on capital lease obligationsValue of Warrants issued


2,500



36,800Net cash provided by financing activities

$
33,758



174,980Increase  (decrease) in cash


915



(2,543
)Cash - beginning of period


2,553



2,558Cash - ending of period

$
3,468


$
15





See notes to consolidated financial statements.




6
 Table of Contents








Global Entertainment Holdings Inc.


NotesTo Consolidated Financial Statements




Note 1 - Basis of Presentation





The condensed interim financial statements included herein, presented in accordance with United States Generally Accepted Accounting Principles (GAAP) and stated in US dollars, have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading.





These statements reflect all adjustments, consisting of normal recurring adjustments, which in the opinion of management are necessary for fair presentation of the information contained therein. It is suggested that these condensed interim financial statements be read in conjunction with the financial statements of the Company for
the year ended December 31, 2008, and notes thereto included in the Company's Form 10-K annual report. The Company follows the same accounting policies in the preparation of interim reports.





Results of operation for the interim period are not indicative of annual results.





Fixed Assets


Fixed assets are stated at cost less accumulated depreciation. Depreciation is recorded on a straight-line basis over a period of the shorter of the related applicable lease term or the estimated useful lives of the assets ranging from 3 to 5 years. Depreciation expense for the six months ending June 30, 2009 and 2008, was $4,139 and
$3,759 respectively.





Long Term Assets


The Book, TV and Film Rights costs are recorded as assets as required by the AICPA Statement Of Position 00-2. The costs will be amortized using the individual film forecast computation method.





Global Universal Film Group, Inc., purchased the majority of the Books, TV and Movie Rights in January, 2006, for approximately $160,000. The total capitalized assets as of June 30, 2009 are $230,855.  The expenditures that are related to specific Film, TV or Book projects are capitalized as a long-term asset.  The
capitalized costs will be amortized using the individual film forecast computation method as film revenues are obtained.





Website Software


The Company adheres to the AICPA Statement of Position 98-1 Accounting For The Cost Of Computer Software Developed or Obtained For Internal Use. During the year 2007 the Company had expenditures of $6,000 for Global Universal film Group Inc. our subsidiary for the development of its website. Software purchased will be amortized over
a period of three years straight-line basis. The amortization will begin in the year 2008. As of June 30, 2009, $1,000 has been amortized for the six  months.





Revenue Recognition


Film revenue from licensing agreements is recognized when the license period begins and the licensee and the Company become contractually obligated under a non-cancellable agreement. All revenue recognition for license agreements is in compliance with the AICPA's Statement of Position 00-2, Accounting by Producers or Distributors of
Films. To date, Global Universal has not produced any film revenue.




Note 2 - Bankruptcy Petition and Reorganization





On April 2, 2003, certain creditors filed an involuntary bankruptcy petition under Chapter 7 of the United States Bankruptcy Code against LitFunding Corp., a Nevada corporation.





On June 17, 2004, a Plan of Reorganization was approved by the Bankruptcy Court. The only remaining bankruptcy liability at June 30, 2009, is $40,000 in principal amount of the Company’s 9% Debentures, which matured on June 30, 2008.





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Note 3 – Notes Receivable





On September 22, 2008, the Company entered into an Exclusive License Agreement with its Canadian affiliate, Global Universal Pictures, Inc., a Canadian corporation (“Global Pictures”), whereby the Company granted a worldwide, exclusive license to Global Pictures to use the work entitled "Blue Seduction" (the "Film"). The license
includes: (1) the right to promote the Film throughout the world in all languages and in all distribution markets, including TV, home video, DVD and non-theatrical and theatrical markets, and (2) merchandise rights relating to all goods and services appearing in the Film. The Company owns a thirty percent (30%) equity interest in Global Pictures.





As a condition to the license, Global Pictures agreed to credit the Company as the source of the original concept for the Film and Mr. Gary Rasmussen, the Company's President, as Executive Producer.





Subject to financing of the Film, Global Pictures agreed to pay the Company an all inclusive one-time fee of (i) U.S. $150,000, evidenced by a Promissory Note dated October 2, 2008, and due on March 31, 2009 (the "Fee"), and (ii) revenue representing 50% of Global Pictures' "Net Receipts" from the sale of the Film rights in the worldwide
marketplace.





Terms of the October 2, 2008 secured promissory note of $150,000 are, issued October 2, 2008, due date March 31, 2009 with interest to accrue at 10% per annum The maker of the note is Global Universal Pictures, Inc., the co-debtor of the note is B & J Pictures, Inc., a Canadian corporation formed to produce the film “Blue
Seduction.” As of July 31, 2009, the Company had realized payments of $28,500 under the Promissory Note and the current outstanding balance is $121,500, plus accrued interest of $11,140. At present, the Promissory Note is past due and in default with interest to be applied on the unpaid balance at the maximum interest rate permitted under applicable law (the default rate).  Payment is expected upon the sale of the film rights to “Blue Seduction.”





Note 4 - Deferred Revenue





On September 22, 2008, the Company entered into an Exclusive License Agreement with its Canadian affiliate, Global Pictures, whereby the Company granted a worldwide, exclusive license to Global Pictures to use the work entitled "Blue Seduction" (the "Film"). The license includes: (1) the right to promote the Film throughout the world
in all languages and in all distribution markets, including TV, home video, DVD and non-theatrical and theatrical markets, and (2) merchandise rights relating to all goods and services appearing in the Film. The Company owns a thirty percent (30%) equity interest in Global Pictures.




Subject to financing of the Film, Global Pictures agreed to pay the Company an all inclusive one-time fee of (i) U.S. $150,000, evidenced by a Promissory Note due March 31, 2009 (the "Fee"), and (ii) revenue representing 50% of Global Pictures' "Net Receipts" from the sale of the Film rights in the worldwide marketplace.





The $150,000 fee has been recorded as deferred revenue and will be amortized as a percentage of the net receipts from the sale of the film rights.





Note 5 - Participation Agreements





On September 22, 2008, the Company entered into an Exclusive License Agreement with its Canadian affiliate, Global Universal Pictures, Inc. (“Global Pictures”), whereby the Company granted a worldwide, exclusive license to Global Pictures to use the work entitled "Blue Seduction" (the "Film"). The license includes: (1)
the right to promote the Film throughout the world in all languages and in all distribution markets, including TV, home video, DVD and non-theatrical and theatrical markets, and (2) merchandise rights relating to all goods and services appearing in the Film. The Company owns a thirty percent (30%) equity interest in Global Pictures.





As a condition to the license, Global Pictures agreed to credit the Company as the source of the original concept for the Film and Mr. Gary Rasmussen, the Company's President, as Executive Producer.





Subject to financing of the Film, Global Pictures agreed to pay the Company an all inclusive one-time fee of (i) U.S. $150,000, evidenced by a Promissory Note due March 31, 2009 (the "Fee"), and (ii) revenue representing 50% of Global Pictures' "Net Receipts" from the sale of the Film rights in the worldwide marketplace. To date, the
Company has realized any revenues from its participation in the sale of film rights to “Blue Seduction.”





In April of 2009, Global Pictures appointed Global Universal Film Group, a wholly-owned subsidiary of the Company, as Sales Agent for the film entitled “American Sunset” being produced in Canada by Global Pictures. Pursuant to the Sales Agent agreement, Global Universal Film Group will receive a fee of 10% from the sale of all
foreign rights of the film “American Sunset.”





8
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Note 6 - Debentures





During the year ended December 31, 2002, the Company issued $200,000 in principal amount, 5-year, 9% convertible debenture, due January 1, 2007. Included was one debenture due to a related party for $10,000. Interest is due semi-annually on the first day of June and December of each year, commencing June 1, 2003 until fully paid. As part
of the plan of reorganization, these debentures were amended with a new maturity of June 30, 2008. In December 2007, the Company converted $150,000 principal amount of the debentures, plus approximately $21,000 in accrued interest, into 171,000 shares of Common Stock.  At June 30, 2009 the Company had debentures outstanding of $40,000, with accrued interest totaling $11,700.





The registered holders of the debentures have the right, after one year prior to maturity, to convert the principal at the original conversion price of $10 for one Common share or at the adjusted conversion price. If and whenever on or after the date of the debenture, the Company issues or sells any share of common stock for a consideration
per share less than the initial conversion rate, then upon such issue or sale, the initial conversion rate shall be reduced to the lowest net price per share at which such share of common stock have been issued. The debentures are subordinated to all the senior indebtedness, including debts under equity participation agreements.




Note 7- Debt





Notes payable at June 30, 2009 is comprised of the following:





Note payable to entity, original balance of $19,181.   Principal and interest due June 15, 2006. Currently in default The Note is unsecured.

$
9,591Note payable to entity, original balance $32,187. This note is unsecured.  Currently in default Due March 22,2006

$
6,094Note payable to entity, original balance of $15,000 due in three monthly installments of $5,000 beginning April 15, 2006. T Currently in default  he Note is unsecured.

$
10,000Note payable to entity, original balance of $30,502 due in two monthly installments of $15,251 beginning April 15, 2006. Currently in default  The Note is unsecured.

$
10,081Advances to be converted into notes.

$
16,713Notes payable face amounts totaling $42,500, with various interest rates and due dates. The notes have been verbally extended.

$
42,500Note payable face amount $40,000, dated May 1, 2008, interest rate 12% due date April 30, 2009. Currently in default. An extension is being pursued.

$
40,000Note payable face amount $20,000, dated May 1,2008, interest rate 12% due date April 30, 2009. Currently in default.  An extension is being pursued.

$
20,000Note payable face amount $8,000, dated July 7, 2008, interest rate 12% due date March 31,2009. Currently in default. An extension is being pursued.

$
8,000Note payable face amount $4,500, dated July 8, 2008, interest rate 12% due date March 31, 2009. Currently in default. An extension is being pursued.

$
4,500Note payable face amount $4,500 date August 19, 2008, interest rate 12% due date March 31, 2009. Currently in default. An extension is being pursued.

$
4,500Global Notes with no specified due dates and varying interest rates.

$
59,383Note payable face amount $25,000 date January 13, 2009, interest rate 10% due date March 31, 2009 with a 30-day grace period. Currently in default. An extension is being pursued.

$
25,000Note payable face amount $2,000 date February 17, 2009, interest rate 6% due date April 15, 2010.

$
2,000Note payable face amount $1,500 date March  6, 2009, interest rate 6% due date April 15, 2010.

$
1,500Total

$
259,862




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Note 8 – Stockholders’ Equity





Common Stock – Issued





The following common stock was issued during the six months ending June 30, 2009.





On March 16, 2009 the Company issued 10,000,000 restricted shares of its $0.001 par value common stock to Rochester Capital Partners, LP at $0.02 per share as a amendment of the original stock purchase agreement by which Rochester Capital Partners, LP agreed to purchase stock in the company in March of 2007. The total shares issued
by the company under the stock purchase agreement are 14,000,000 at an average share price of $0.018 per share.





On April 8, 2009 the Company issued 100,000 restricted shares of its $0.001 par value common stock to an a individual investor at $0.10 per share as documented by a Subscription agreement dated April 7, 2009.





Series “B” Convertible Preferred Stock


On December 6, 2006, pursuant to the terms of a certain reverse tri-party merger with Global Universal Film Group, Inc. (“Film Group”), dated March 7, 2006 (Merger Agreement), we issued a total of 1,500,000 shares of our Series B, Convertible Preferred Stock (“Series B Stock”) to the stockholders of Film Group. Film
Group became a wholly-owned subsidiary of the Company.  Gary Rasmussen, our CEO, owned 50% of the shares of Film Group and received 750,000 shares pursuant to the merger. Jackelyn Giroux, President of Film Group, received 750,000 shares.





Pursuant to the Merger Agreement, Film Group had the unilateral right to “spin-off” from the Company to become a separate, reporting, publicly held company, in exchange for a $200,000 management fee. Film Group paid the Company $26,000 in cash and executed a promissory note for the balance of $174,000. Pursuant to the Merger
Agreement, the Company would retain 10% of Film Group’s shares upon the spin-off and was required to timely file a registration statement covering said shares, thereby effecting the spin-off. The Company failed to file the registration statement.





On October 16, 2006, the Film Group shareholders elected to spin-off from the Company and the Merger Agreement was amended to provide that if the registration statement was not filed on or before June 30, 2007, then Film Group would be entitled to a complete refund of the management fee and to effect a private spin-off.  The
Company’s former management failed to file the registration statement by June 30, 2007.





In September of 2007, Mr. Rasmussen (a former 50% shareholder of Film Group prior to the Merger Agreement) was appointed to the Board of Directors and elected Interim CEO of the Company.  At that time, the Company’s debt was in excess of $3 Million and, in the opinion of new management, its core business and primary
assets were essentially worthless. The former shareholders of Film Group (now holders of all of the Series B Stock) decided to restructure the Company and remain a part of it rather than effect a spin-off.  Accordingly, the Series B Stock was amended to remove the right to effect a spin-off of Film Group and a new Series C Convertible Preferred stock was authorized by the Board of Directors and issued to the holders of the Series B Stock to reflect changes agreed to between the Board of Directors and
the former shareholders of Film Group.





In December 2007, we agreed to issue an additional 2,490,134 shares of Series B Stock in exchange for the cancellation of $273,915 in debt of Film Group. Mr. Rasmussen received 343,227 shares directly in his name, and Rochester Capital Partners received 641,225 shares. Ms. Giroux received 1,505,682 shares directly in her name. However,
said shares were not issued by our transfer agent until April 22, 2008.  The total 3,990,314 shares of our Series B Stock outstanding are convertible into 3,990,134 shares of common stock at anytime. The Series B Stock is not affected by any stock splits. A full description of the terms and conditions of the series B Convertible Preferred stock is contained in the Company’s filing on Form 8-K, as filed on December 12, 2007.





Series C Convertible Preferred Stock


In January, 2008, in keeping with the restructuring efforts of the new management team, the Board authorized the issuance of 6,000,000 shares of a non-dilutive, convertible preferred stock entitled, Series C Convertible Preferred Stock (“Series C Stock”). On April 4, 2008, the Company filed a Certificate of Designation relating
to its Series C Convertible Preferred Stock with the Nevada Secretary of State.  A full description of the terms and conditions of the Series C Preferred Stock is listed as exhibit 3.3, incorporated as a part of this document on Form 10-Q.





Additionally, in November, 2008, the Company’s Board of Directors authorized the issuance of an additional 500,000 shares of Series C Preferred stock to Mr. Rasmussen in partial consideration for his agreement to: (i) reduce his salary to $10,000 per month, (ii) to defer the receipt of his salary and other compensation until such
time as the Company has sufficient funds, and (iii) for his agreement to forego receipt of all accrued salary due him from inception of his employment through September 30, 2008. These shares were not issued until April 22, 2009.  The Series C Stock is non-dilutive and, the 6,500,000 shares authorized and presently outstanding, will convert at anytime, in whole or in part, into 65% of the Company’s outstanding common stock as calculated immediately after such conversion.





Note 9 – Contingencies





The Company is not a party to any litigation as of the date of this quarterly report.





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Note 10 – Warrants and Options





During the six months ended June 30, 2009, there were no options issued.  Fifty thousand warrants were issued to an individual investor in connection with a promissory note.  During the period, 300,000 warrants had their exercise date extended to January 31, 2010 from March 31, 2009. One of the warrant Agreements for
100,000 shares also had the exercise price adjusted from $0.40 per share to $0.25 per share.





Options and Warrants Exercised


During the six months ended June 30, 2009, there were no options exercised. There were no warrants exercised.





The summary of activity for the Company's stock options/warrants is presented below:





Six  months
June 30, 2009


Weighted Average
Exercise PriceOptions/warrants outstanding at beginning of period


481,675


$
1.65Granted


50,000


$
0.05Exercised


-


$Terminated/Expired


-


$Options/warrants outstanding at end of period


531,675


$
2.01Options/warrants exercisable at end of period


531,675


$
2.01Price per share of options outstanding

$
0.05 -70.00Weighted average remaining contractual lives

1.57 yearsWeighted average fair value of options or warrants granted during the period

$
0.02




Note 11 – Related Party Transactions





On September 22, 2008, the Company entered into an Exclusive License Agreement with its Canadian affiliate, Global Universal Pictures, Inc. (“Global Pictures”), whereby the Company granted a world-wide exclusive license to Global Pictures to use the work entitled “Blue Seduction” (the “Film”).  The
license includes (1) the right to promote the Film throughout the world in all languages and in all distribution markets, including TV, home video, DVD and non-theatrical and theatrical markets, and (2) merchandise rights relating to all goods and services appearing in the Film. The Company owns a thirty percent (30%) equity interest in Global Pictures and Jackelyn Giroux, its president retains the balance of equity.





As a condition to the license, Global Pictures agreed to credit the Company as the source of the original concept for the Film and Mr. Gary Rasmussen, the Company’s President, as an Executive Producer.





Subject to financing of the Film, Global Pictures agreed to pay the Company an all inclusive one-time fee of (i) U.S. $150,000 and (ii) revenue representing 50% of its “Net Receipts” from the sale of the Film rights.





Also on September 27, 2008, Global Pictures transferred, through an intermediary Canadian company formed for this purpose, its right to develop, produce and exploit the Film to B & J Pictures, Inc. (“Transferee”), and, on October 2, 2008, the Company agreed to subscribe to CA $150,000 of preferred shares in the share
capital of Transferee as its “Producer’s Investment” in the Film, subject to the closing of a bank loan between National Bank of Canada and Transferee.





The original rights to the Film were acquired by the Company from Ms. Jackelyn Giroux in connection with her employment as President of Global Universal Film Group, a wholly-owned subsidiary of the Company. Ms. Giroux will receive a fee as Producer of the Film directly from B & J Pictures.





As of October 2, 2008, National Bank of Canada agreed to fund approximately $1.1M Canadian for the production of Blue Seduction. The bank financing was contingent upon the bank's receipt of a Completion Bond that guaranteed the film was actually produced and delivered; in order that the bank could collect on certain
available tax credits and advances pending.





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The Completion Bond Company, Film Finances of Canada, Ltd., requested that the Company provide it with its guarantee for any amounts that the Producers (i.e., B & J Pictures and Global Universal Pictures) may be obligated to Film Finances for. The contingent liability of the Company under its guarantee
is difficult to determine at this time because, in essence, the completion bond company is backing up the bank loan, and the bank loan is structured as a credit facility that provides B & J Pictures with periodic draws in both U.S. and Canadian currencies.  The bank agreed to advance up to $613,000 in Canadian dollars (including an interest reserve and costs), and up to $425,000 in U.S. currency





On May 14, 2008, the Company issued 3,000,000 shares of Series C Preferred Stock to Gary Rasmussen, the CEO of Global Entertainment Holdings Inc., and former 50% shareholder of Global Universal Film Group Inc. The shares were issued in consideration for waiving the contractual right of Global Universal Film Group to spin-off from Global
Entertainment Holdings at June 30, 2008. The share price issue was at $0.001 par value.





On May 14, 2008, 3,000,000 shares of Series C Preferred Stock was issued to Jackelyn Giroux, the President Global Universal Film Group and former 50% shareholder of Global Universal Film Group. The shares were issued in consideration for waiving the contractual right of Global Universal Film Group to spin-off from Global Entertainment Holdings
at June 30, 2008. The share price issue was at $0.001 par.





Stanley Weiner, Vice President of Finance and a director of Global Entertainment Holdings, received 400,000 shares of restricted common stock as payment for the cancellation of a $40,000 promissory note. These shares were assigned by Mr. Weiner as indicated below.





On May 30, 2008, 200,000 shares of restricted common stock, par value $0.001, were issued to the H. Robert Weiner Trust of 1983, in consideration for its pro-rata share of a $40,000 outstanding loan held by Stanley Weiner, the share price was $0.10 per share.





On May 30,2008, 104,760 shares of restricted common stock, par value $0.001, were issued to the Marital Trust created under the will of Blanche Weiner, in consideration for its pro-rata share of a $40,000 outstanding loan held by Stanley Weiner, the share price was $0.10 per share.





On May 30,2008, 95,240 shares of restricted common stock, par value $0.001, were issued to the Disclaimed Residential Trust, created under the Will of Blanche Weiner, in consideration for its pro-rata share of a $40,000 outstanding loan held by Stanley Weiner, the share price was $0.10 per share.




Note 12 - Subsequent Events





On July 24, 2009 the Company issued 10,000 restricted shares of its $0.001 par value common stock at $0.02 to Wendy Shepherd for services. These shares were issued as follows:





Michael Shepherd                                                                                        7,000
shares


Wendy Shepherd JTWROS





Wendy Shepherd Custodian for                                                                1,000
shares


Timothy Shepherd UGMA





Wendy Shepherd Custodian for                                                                1,000
Shares


Erick Shepherd UGMA





Wendy Shepherd Custodian for                                                                1,000
shares


Mark Shepherd UGMA





On July 24, 2009 the Company issued 5,000 restricted shares of its $0.001 par value common stock at $0.02 to Michael Masucci for services.





On July 24, 2009 the Company issued 5,000 restricted shares of its $0.001 par value common stock at $0.02 to Edymar Gonzalez custodian for Ariel Elias Molina UGMA for services.





On July 24, 2009 the Company issued 10,000 restricted shares of its $0.001 par value common stock at $0.02 to Island Capital Management, LLC for services per contractual agreement.




ITEM 1B.    UNRESOLVED STAFF COMMENTS





On April 20, 2009, we received a comment letter from the staff of the SEC’s Division of Corporation Finance. The comments from the staff were issued with respect to its review of our Form 10-KSB for the fiscal year ended December 31, 2007 (file No. 000-49679), as filed with the SEC on April 17, 2008. The staff comments related to
the adequacy of the disclosures relating to: the Report of Independent Registered Public Accounting Firm and the foot note relating to the restatement of annual financial information. The Company is in the process of responding to the staff comments and the filing of an amendment to its Annual Report on Form 10–K.




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FORWARD-LOOKING STATEMENTS





Private Securities Litigation Reform Act of 1995.  All statements other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including, but not limited to, any projections of earnings, revenue or other financial items; any statements of the plans, strategies
and objections of management for future operations; any statements concerning proposed new services or developments; any statements regarding future economic conditions or performance; any statements or belief; and any statements of assumptions underlying any of the foregoing.





Forward-looking statements may include the words “may,” “could,” “estimate,” “intend,” “continue,” “believe,” “expect” or “anticipate” or other similar words.  These forward-looking statements present our estimates and assumptions only
as of the date of this report.  Except for our ongoing securities laws, we do not intend, and undertake no obligation, to update any forward-looking statement.





Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any or our forward-looking statements.  Our future financial condition and results of operations, as well as any forward-looking statements, are
subject to change and inherent risks and uncertainties.  The factors impacting these risks and uncertainties include, but are not limited to:





o        increased competitive pressures from existing competitors and new entrants;





o        increases in interest rates or our cost of borrowing or a default under any material debt agreements;





o        deterioration in general or regional economic conditions;





o
adverse state or federal legislation or regulation that increases the costs of compliance, or adverse findings by a regulator with respect to existing operations;





o        loss of customers or sales weakness;





o        inability to achieve future sales levels or other operating results;





o        the unavailability of funds for capital expenditures and/or general working capital; and





o        operational inefficiencies in distribution or other systems.





For a detailed description of these and other factors that could cause actual results to differ materially from those expressed in any forward-looking statement, please see “Factors That May Affect Our Plan of Operation” in this document and in our Annual Report on Form 10-K for the year ended December 31, 2008.





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ITEM 2.  MANAGEMENT’S DISCUSSION & ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.





OVERVIEW AND OUTLOOK





We have recently restructured the Company and are now focusing our efforts on the development, financing and production of feature-length films, which operation will be conducted primarily through our subsidiary companies, Global Universal Entertainment, Global Universal Film Group and Global Universal Pictures (collectively, “Global
Universal”).





Global Universal plans to develop the business of producing low-budget, genre pictures with recognizable, name talent. Global Universal’s management believes investment risk can be significantly reduced by utilizing Canadian and other territorial  Government tax incentives to off-set up to 40%, or more, of each film’s
budget. Additional coverage of between 20% to 25% of a film’s budget can be derived from distributor commitments and/or pre-sales of foreign and/or U.S. rights to a film.  The remaining balance (approx. 35% to 40%) will be obtained from private investment of debt, equity or combination of both.  Management intends to retain revenues generated from one or more territories of each film to provide cash flow for operating expenses.





Current Negotiations





Global Universal is currently in negotiations with several international film distribution companies to produce and distribute a proprietary slate of six or more feature-length films. Under the proposed arrangements with the distribution companies, the Company would be responsible for arranging financing from tax credits, private investment
and other sources to provide 100% of the budget required to produce the slate of films. We anticipate the distribution companies will charge a fee that is significantly lower than the industry standard of 25% to 35% for distribution services, and provide a minimum guaranteed sales performance and/or a cash advance against selected territories in which film rights are expected to be sold.





Because of the financing incentives noted above, the risk of investment is reduced considerably and profitability may be possible for a direct-to-video release, followed by pay, cable, satellite, free and syndicated television exhibition.  The Company anticipates that at least one of the films produced by Global Universal
will warrant and receive a theatrical release prior to its video distribution.  There is, of course, no guarantee of a theatrical release for any film that may be produced by Global Universal, although it is anticipated that any distribution company selected by Film Group will use its “best efforts” to obtain a U.S. theatrical release through an “out put” or “first look” arrangement with a major, or mini-major film studio.





Results of Operations





The following overview provides a summary of key information concerning our financial results for the second quarter ending June 30, 2009 and 2008.





Total operating expenses were $76,287 and $202,801 for the three-month period ended June 30, 2009 and June 30, 2008 respectively.  The decrease of $126,514 was do to a reduction in General and Administrative expenses. Other income increased by $10,151.





Our net loss was $72,409 for the three months ended June 30, 2009 as compared to a net loss of $209,074 for the three months ended June 30, 2008. The decrease in the net loss of $136,665 is as a result of the changes in costs described above and a increase of $10,151 in other income.





The following provides a summary of key information concerning our financial results for the six months ending June 30, 2009 and 2008.





Total operating expenses were $258,409 and $391,879 for the  six month period ended June 30, 2009 and June 30, 2008 respectively.  The decrease of $133,488 was do to a reduction in General and Administrative expenses. Other income increased by $11,630.





Our net loss was $256,044 for the six months ended June 30, 2009 as compared to a net loss of $374,894 for the six months ended June 30, 2008. The decrease in the net loss of $118,850 is as a result of the changes in costs described above and a gain on debt restructuring of $26,250 realized in the first quarter of 2008.





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Operation Plan





During the next twelve months we plan to focus our efforts on raising capital to cover our basic operating needs, and to develop, finance and produce feature films.





We had minimal cash on hand as of June 30, 2009, and, additional funds will be required to satisfy our working capital requirements for the next twelve months. We will also need to raise funds to continue to implement our business plan of developing, financing and production of films. We plan to raise these funds through private
and institution or other equity offerings including interest-bearing debentures. To this end, we have recently renewed our agreement with Worldwide Financial Solutions as consultants to assist us in our efforts to raise larger amounts of capital for investment in the films we produce.  We may attempt to secure other loans from lending institutions or other sources. We will also consider establishing relationships with selected business partners involved in the motion picture industry, whose contributions
may include necessary cash.  There is no guarantee that we will be able to raise additional funds through offerings or other sources. If we are unable to raise funds, our ability to continue with operations will be materially hindered.





Liquidity and Capital Resources





Liquidity is a measure of a company’s ability to meet potential cash requirements.  We have historically met our capital requirements through the issuance of stock and by borrowings.  In the future we believe we will be able to provide the necessary liquidity we need by the issuance of debt and equity and
revenues generated from our operations.





Satisfaction of our cash obligations for the next 12 months.





As of June 30, 2009, our cash balance was $3,468. Our plan for satisfying our cash requirements for basic operations over the next 12 months entails the sale of equity interests in films produced by our subsidiaries; and/or the private placement of our securities to private individuals or institutions; and/or traditional bank financing.
We intend to make appropriate plans to insure sources of additional capital in the future to fund growth and expansion through additional equity or debt financing or credit facilities. No assurance can be made that such financing would be available, and if available it may take either the form of debt or equity.  In either case, the financing could have a negative impact on our financial condition and our Stockholders.





We anticipate incurring operating losses over the next twelve months. Our lack of operating history makes predictions of future operating results difficult to ascertain. Our prospects must be considered in light of the risks, expenses and difficulties frequently encountered by companies in their early stage of development, particularly
companies in new and rapidly evolving technology markets. Such risks include, but are not limited to, an evolving and unpredictable business model and the management of growth. To address these risks we must, among other things, implement and successfully execute our business and marketing strategy, continue to develop and upgrade technology and products, respond to competitive developments, and continue to attract, retain and motivate qualified personnel. There can be no assurance that we will be successful
in addressing such risks, and the failure to do so can have a material adverse effect on our business prospects, financial condition and results of operations.





Going Concern





The ability of the Company to continue as a going concern remains dependent upon successful implementation of our business plan, obtaining additional capital and financing, and generating positive cash flow from operations. The Company intends to seek additional capital either through debt or equity offerings and believes that our
new business of film production will ultimately lead us to profitability and positive cash flows.





Other Business





In March, 2006, we acquired 100% of the issued and outstanding shares of the common stock of Easy Money Express, Inc., a Nevada Corporation from its two stockholders. Easy Money continued as a wholly-owned subsidiary of the Company until January of 2009, when the name was changed to Global Universal Entertainment, Inc.  To date,
there had been no activity or operations since its acquisition in 2006.  The Company plans to develop this subsidiary as its U.S. presence in producing films and has hired Peter Liapis to manage the business of this subsidiary as its President.





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Summary of product and research and development that we will perform for the term of our plan.

We do not anticipate performing any significant product research and development under our plan of operation until such time as we complete a merger or acquisition.

Expected Purchase or sale of plant and significant equipment.

We do not anticipate the purchase or sale of any plant or significant equipment, as such items are not required by us at this time or anticipated to be needed in the next twelve months.




Significant changes in the number of employees.





We currently employ three full time employees. With the deterioration of the Company’s former operating business, LitFunding USA, and prior to its divestiture, we experienced a deleterious and damaging loss of key personnel as a result of financial difficulties associated with a declining business and poor management.  Our
recent transition into a new core business of developing and producing film and TV projects may require that we expand our personnel and/or hire independent contractors as we generate revenues and as our operations warrant.





Off-Balance Sheet Arrangements





We do not have any off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results or operations, liquidity, capital expenditures or capital resources that is material to investors.





Critical Accounting Policies and Estimates





Our Management's Discussion and Analysis of Financial Condition and Results of Operations section discusses our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these financial statements requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. On an on-going basis, management evaluates its estimates and judgments, including those related to revenue recognition, accrued expenses, financing operations, and contingencies and litigation. Management bases its estimates and judgments on historical experience and on various other factors that are believed to be reasonable
under the circumstances, the results of which form the basis for making judgments about the carrying value of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. The most significant accounting estimates inherent in the preparation of our financial statements include estimates as to the appropriate carrying value of certain assets and liabilities which are not readily apparent from other sources, primarily
allowance for doubtful accounts receivables, accruals for other costs, and the classification of net operating loss and tax credit carry forwards between current and long-term assets. These accounting policies are described at relevant sections in this discussion and analysis and in the notes to the financial statements included in this report.




FACTORS THAT MAY AFFECT OUR RESULTS OF OPERATION





We have a limited operating history and lack of profitability.





We anticipate incurring operating losses over the next twelve months. The Company has recently been restructured and has had no significant operations as a developer and producer of feature-length films. Therefore, such lack of operating history makes predictions of future operating results difficult to ascertain. Our prospects must
be considered in light of the risks, expenses and difficulties frequently encountered by companies in their early stage of development, particularly companies engaged in the film and television industry. Such risks include, but are not limited to, an evolving and unpredictable business model and the management of growth. To address these risks we must, among other things, implement and successfully execute our business and marketing strategy, continue to develop and upgrade technology and products, respond to
competitive developments, and continue to attract, retain and motivate qualified personnel. There can be no assurance that we will be successful in addressing such risks, and the failure to do so can have a material adverse effect on our business prospects, financial condition and results of operations.




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We will require additional funds to achieve our current business strategy of producing films and our inability to obtain additional financing could cause us to cease our business operations.
 
 We will need to raise significant additional funds through public or private debt or sale of equity to achieve our current business strategy with respect to the production of feature-length films. Such financing may not be available when needed. Even if such financing is available, it may be on terms that are materially adverse to
your interests with respect to dilution of book value, dividend preferences, liquidation preferences, or other terms. Our capital requirements to implement our business strategy will be significant. However, at this time, we can not determine the amount of additional funding necessary to implement such plan. We intend to assess such amount at the time we will implement our business plan. Furthermore, we intend to effect future acquisitions with cash
and the issuance of debt and equity securities. The cost of anticipated acquisitions may require us to seek additional financing. We anticipate requiring additional funds in order to fully implement our business plan to significantly expand our operations. We may not be able to obtain financing if and when it is needed on terms we deem acceptable. Our inability to obtain financing would have a material negative effect on our ability to implement our acquisition strategy, and as a result, could require us to diminish
or suspend our acquisition strategy.
  If we are unable to obtain financing on reasonable terms, we could be forced to delay, scale back or eliminate certain film projects. In addition, such inability to obtain financing on reasonable terms could have a material negative effect on our business, operating results, or
financial condition to such extent that we are forced to restructure, file for bankruptcy, sell assets or cease operations, any of which could put an investment in our Company at significant risk.




We have historically had losses from operations and losses may continue in the future, which may cause us to curtail operations.





Since our inception we have not been profitable and have lost money on both a cash and non-cash basis.  For the three months ended June 30, 2009, we incurred a net loss of $256,044. Our accumulated deficit at the end of June 30, 2009, was $12,296,121. Future losses are likely to occur, as we are dependent on spending money to
pay for our operations. No assurances can be given that we will be successful in reaching or maintaining profitable operations.  Accordingly, we may experience liquidity and cash flow problems.  If our losses continue, our ability to operate may be severely impacted or alternatively we may be forced to terminate our operations.





We are subject to a working capital deficit, which means that our current assets on June 30, 2009, were not sufficient to satisfy our current liabilities and, therefore, our ability to continue operations is at risk.





We had a working capital deficit for the six months ended June 30,2009, which means that our current liabilities exceeded our current assets on June 30, 2009, by $633,159.  Current assets are assets that are expected to be converted to cash within one year and, therefore, may be used to pay current liabilities as they become
due.  Our working capital deficit means that our current assets on June 30, 2009, were not sufficient to satisfy all of our current liabilities on June 30, 2009.  If our ongoing operations do not begin to provide sufficient profitability to offset the working capital deficit, we may have to raise capital or debt to fund the deficit or curtail future operations.





Our common stock is listed on the Over-the-Counter (OTC) Pink Sheets, which may make it more difficult for stockholders to sell their shares and may cause the market price of our common stock to decrease.





Our common stock is listed on the OTC Pink Sheets under the trading symbol: GBHL.PK.  Factors that may affect potential liquidity include limited coverage by security analysts and the news media.  This may negatively affect the prices for our shares of common stock.





Our stock price may be volatile and an investment in such common stock could suffer a decline in value.





The market price of our common stock may fluctuate significantly and violently in response to a number of factors, some of which are beyond our control.  These factors include:





·      Government regulatory action affecting our services or competitor’s services;


·      Actual or anticipated fluctuations in operating results;


·      The loss of key management or other personnel;


·      The loss of major customers;


·      The outcome of any future litigation;


·      Broad market fluctuations; and economic conditions in the United States or abroad.




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We could fail to attract or retain key personnel, which could be detrimental to our operations.

Our success largely depends on the efforts and abilities of our Officers and Directors.  The loss of their services could materially harm our business because of the cost and time necessary to find successors.  Such a loss would also divert management attention away from operational issues. We do
not have other key employees who manage our operations.  To the extent that we are smaller than our competitors and have fewer resources, we may not be able to attract a sufficient number and quality of staff, when required.

Because our common stock is deemed a low-priced “Penny” stock, an investment in our common stock should be considered high risk and subject to marketability restrictions.

Since our common stock is a penny stock, as defined in Rule 3a51-1 under the Securities Exchange Act, it will be more difficult for investors to liquidate their investment even if and when a market develops for the common stock. Until the trading price of the common stock rises above $5.00 per share, if ever, trading
in the common stock is subject to the penny stock rules of the Securities Exchange Act specified in rules 15g-1 through 15g-10. Those rules require broker-dealers, before effecting transactions in any penny stock, to:

●Deliver to the customer, and obtain a written receipt for, a disclosure document;
● Disclose certain price information about the stock;
●Disclose the amount of compensation received by the broker-dealer or any associated person of the broker-dealer;

●Send monthly statements to customers with market and price information about the penny stock; and
●In some circumstances, approve the purchaser’s account under certain standards and deliver
written statements to the customer with information specified in the rules.

Consequently, the penny stock rules may restrict the ability or willingness of broker-dealers to sell the common stock and may affect the ability of holders to sell their common stock in the secondary market and the price at which such holders can sell any such securities. These
additional procedures could also limit our ability to raise additional capital in the future.


ITEM 3.  QUATITATIVE & QUALITATIVE DISCLOSURES ABOUT MARKET RISK





There have been no material changes in the Company’s market risk exposures from those reported in our Annual Report on Form 10-K for the year ended December 31, 2008.




ITEM 4.  CONTROLS AND PROCEDURES (SEE NOTES)





The Company’s management under the supervision and with the participation of the Company’s Chief Executive Officer( the “CEO”) and Chief Financial Officer (the “CFO”), performed an evaluation of the effectiveness of the design, maintenance and operation of the Company’s disclosure controls and procedures
as of June 30, 2009. Based on the evaluation, the CEO and CFO concluded that the Company’s disclosure controls and procedures were effective.  There has been a significant change in the Company's internal controls with the addition of legal counsel for an outside review of disclosures and disclosure controls.  Their have been no other changes in the Company’s internal controls or in other factors that materially affected, or would reasonably be likely to materially affect the Company’s
internal control over financial reporting.





We conducted an evaluation, with the participation of Gary Rasmussen, our current Chief Executive Officer, and Terry Gabby, our Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended,
as of June 30, 2009, to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities Exchange Commission’s rules and forms, including to ensure that information required to be disclosed by us in the reports filed or submitted by us under the Exchange Act is accumulated and communicated to our management, including our principal executive and principal
financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure. Based on that evaluation, Messrs. Rasmussen and Gabby have concluded that as of June 30, 2009, our disclosure controls and procedures were effective at the reasonable assurance level.




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PART II – OTHER INFORMATION





Item 1.  Legal Proceedings





The Company is not currently a party to any litigation.




Item 2. Unregistered Sales of Equity Securities and Use of Proceeds





There were sales of unregistered equity securities during the six months ending June 30, 2009.





On March 16, 2009 the Company issued 10,000,000 restricted shares of its $0.001 par value common stock to Rochester Capital Partners, LP at $0.02 per share as a continuation of the original for stock purchase agreement by which Rochester Capital Partners, LP agreed to purchase stock in the company in March of 2007.





On April 8, 2009 the Company issued 100,000 restricted shares of its $0.001 par value common stock to an individual at $0.10 per share as documented by a Subscription agreement dated April 7, 2009. The proceeds from the sale were used for working capital.




On April 13, 2009 the Company authorized 100,000 restricted shares of its $0.001 par value common stock to an individual at $0.10 per share as documented by a Subscription agreement dated April 13, 2009. These shares have not been issued at this time. The proceeds from the sale were used for working capital.





The foregoing sales of shares of our common stock are qualified for exemption under Section 4(2) of the Securities Act of 1933, as amended (the “Securities Act”), since the issuance of these shares by us did not involve a public offering, and no public solicitation or advertisement was made or relied upon by any of the
foregoing investors.





Item 3.  Defaults Upon Senior Securities





None.





Item 4.  Submission of Matters to a Vote of Security Holders





None.





Item 5.  Other Information





On September 22, 2008, the Company entered into an Exclusive License Agreement with its Canadian affiliate, Global Universal Pictures, Inc. (“Global Pictures’) whereby the Company granted a world-wide exclusive license to Global Pictures to use the work entitled “Blue Seduction” (the “Film”).  The
license includes (1) the right to promote the Film throughout the world in all languages and in all distribution markets, including TV, home video, DVD and non theatrical and theatrical markets and (2) merchandise rights relating to all goods and services appearing in the Film. The Company owns a thirty percent (30%) equity interest in Global Pictures.





As a condition to the license, Global Pictures agreed to credit the Company as the source of the original concept for the Film and Mr. Gary Rasmussen, the Company’s President, as Associate Producer.





Subject to financing of the Film, Global Pictures agreed to pay the Company an all inclusive one-time fee of (i) U.S. $150,000 and (ii) revenue representing 50% of its “Net Receipts” from the sale of the film rights.





Also on September 22, 2008, Global Pictures transferred, through an intermediary Canadian company formed for this purpose, its right to develop, produce and exploit the Film to B & J Pictures, Inc. (“Transferee”), and, on October 2, 2008, the Company agreed to subscribe to CA $150,000 of preferred shares in the share
capital of Transferee as its “Producer Investment” in the Film, subject to the closing of a bank loan between National Bank of Canada and Transferee.





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The original rights to the Film were acquired by the Company from Ms. Jackelyn Giroux in connection with her employment as President of Global Universal Film Group, a wholly-owned subsidiary of the Company. Ms. Giroux will receive a fee as Producer of the Film directly from B & J Pictures.





As of October 2, 2008, National Bank of Canada agreed to fund approximately $1.1M Canadian toward a portion of the cost for the production of Blue Seduction. The bank financing is contingent upon the bank's receipt of a Completion Bond that will guarantee that the film is actually produced and delivered -- so the bank
can collect on certain available tax credits and advances pending.





The Completion Bond Company, Film Finances of Canada, Ltd., requested that the Company provide it with its guarantee for any amounts that the Producers (i.e., B & J Pictures and Global Universal Pictures) may be obligated to Film Finances for. The contingent liability of the Company under its guarantee
is difficult to determine at this time because, in essence, the completion bond company is backing up the bank loan, and the bank loan is structured as a credit facility that provides B & J Pictures with periodic draws in both U.S. and Canadian currencies.  The bank agreed to advance up to $613,000 in Canadian dollars (including an interest reserve and costs), and up to $425,000 in U.S. currency.





Divestiture of LitFunding USA





On March 28, 2008, the Company entered into Stock Purchase Agreement (the “Divestiture Agreement”) with Iscom, Inc., whereby, effective on March 31, 2008, we divested ourselves of all of assets and liabilities of LitFunding USA, Inc.  LitFunding USA was a wholly-owned subsidiary of the Company engaged in the business
of advancing funds to Plaintiffs attorneys on various legal actions, for which it anticipated earning a fee along with the return of such advances upon a favorable outcome of the litigation. The business operations of LitFunding USA, and corresponding liabilities, represented the majority of the Company’s former business operations.





Under the terms of the Divestiture Agreement, we received consideration and Iscom, Inc. assumed all disclosed and undisclosed liabilities. The Company retains a fifty percent (50%) share in the net revenues, if any, that may be received by Iscom, Inc. collected from advances and fees due from clients of LitFunding USA, Inc., net of (1)
all expenses associated with collection of such advances, (2) the amount of liabilities assumed by Iscom, Inc., and (3) a 15% collection fee.  The Company has no obligation to assist or participate in any collection effort of Iscom, Inc., and based upon prior experience with the business of LitFunding USA, does not expect to receive any significant income from this arrangement.





The foregoing description of the terms and conditions of the Divesture Agreement is qualified in its entirety by, and made subject to, the more complete information set forth in the entire Divestiture Agreement, a copy of which was filed as an exhibit to our Form 8-K, dated March 28, 2008, and filed with the SEC on April 8, 2008.





Item 6.  Exhibits and Reports on Form 8-K





Exhibits





Exhibit Number
Description2.1
Plan and agreement of merger between RP Entertainment Inc., RP Acquisition Corp. and LitFunding Corp. dated February 21, 2003 (Incorporated by reference to the exhibits to Form 8-K filed on March 11, 2003)2.2
U.S. Bankruptcy Court Stipulation between LitFunding Corporation and Petitioning Creditors dated November 14, 2003 (Incorporated by reference to the exhibits to Form 8-K filed on December 4, 2003)2.3
U. S. Bankruptcy Court Notice of Entry of Judgment (Incorporated by reference to the exhibits to Form 8-K filed on December 4, 2003)2.4
U.S. Bankruptcy Court Chapter 11 Plan of Reorganization dated April 7, 2004 (Incorporated by reference to the exhibits to Form 8-K filed on July 6, 2004)2.5
Agreement and Plan of Merger between LitFunding Inc., LFDG Subsidiary Corp. and Easy Money Express Inc. dated February 7th, 2006 (Incorporated by reference to the exhibits to Form 8-K filed on February 13,
2006)3(i).1
Articles of Incorporation dated July 2, 1996 (Incorporated by reference to the exhibits to Form SB-2 filed on June 19, 2001)3(i).2
Certificate of Amendment to Articles of Incorporation dated September 4, 1996 (Incorporated by reference to the exhibits to Form SB-2 filed on June 19, 2001)3(ii).1
By-Laws dated September 2, 1996 (Incorporated by reference to the exhibits to Form SB-2 filed on June 19, 2001)3(ii).2
Amendment of By-laws dated March 5, 1997 (Incorporated by reference to the exhibits to Form SB-2 filed on June 19, 2001)3.3
Certificate of Amendment to Designation of Series B Convertible Preferred Stock, dated December 6, 2007 (10)3.4
Certificate of Designation of Series C Convertible Preferred Stock, dated January 9, 2008 (Incorporated by reference to exhibit 3.3 to Form10-QSB filed on August 14, 2008)3.5*
Amendment of Certificate of Designation of Series C Convertible Preferred Stock, dated November 8, 20084.1
Common Stock Certificate Form (Incorporated by reference to the exhibits to Form SB-2 filed on June 19, 2001)10.1
Agreement between RP Entertainment Inc. and Brutus Productions dated May 1, 1999 (Incorporated by reference to the exhibits to Form SB-2A filed on August 3, 2001)10.2
Amended 2002 Employee Stock Compensation Plan Prospectus dated September 2, 2003 (Incorporated by reference to the exhibits to Form S-8 filed on September 10, 2003)10.3
Amended 2002 Employee Stock Compensation Plan Certification of Plan Adoption dated September 2, 2003 (Incorporated by reference to the exhibits to Form S-8 filed on September 10, 2003)10.4
2004 Stock Option Plan dated March 9, 2004 (Incorporated by reference to the exhibits to Form DEF 14A filed on July 13, 2004)10.5
Employment Agreement between LitFunding USA and Stephen D. King dated October 2004 (Incorporated by reference to the exhibits to Form S-8 filed on October 28, 2004)10.6
Investment Agreement between LitFunding Corp. and Dutchess Private Equities Fund, L.P. dated January 14, 2005 (Incorporated by reference to the exhibits to Form 8-K filed on January 21, 2005)10.7
Registration Rights Agreement between LitFunding Corp. and Dutchess Private Equities Fund, L.P. dated January 14, 2005 (Incorporated by reference to the exhibits to Form 8-K filed on January 21, 2005)10.8
Option Agreement between Silver Dollar Productions Inc. and Morton Reed dated January 31, 2005 (Incorporated by reference to the exhibits to Form PRE 14C filed on March 21, 2005)10.9
Certificate of Designation dated July 25, 2005 (Incorporated by reference to the exhibits to Form S-8 filed on July 28, 2005)10.10
Binding letter of intent of merger between LitFunding Corp. and Cashwize Inc. dated September 15, 2005 (Incorporated by reference to the exhibits to Form 8-K filed on September 19, 2005)10.11
Letter of intent of merger between LitFunding Corp. and Easy Money Express Inc. dated December 14, 2005 (Incorporated by reference to the exhibits to Form 8-K filed on January 3, 2006)  20
  Exhibit Number
Description10.12
Binding Letter of Intent between Silver Dollar Productions, Inc. and Global Universal Film, Group Ent. Inc. dated December 21, 2005 (Incorporated by reference to the exhibits to Form 8-K filed on January 12, 2006)10.13
Investment Agreement with Imperial Capital Holdings, dated January 16, 2006 (Incorporated by reference to the exhibits to Form 8-K filed on February 1, 2006)10.14
Registration Rights Agreement with Imperial Capital Holdings, dated January 19, 2006 (Incorporated by reference to the exhibits to Form 8-K filed on February 1, 2006)10.15
Placement Agent Agreement with Brewer Financial Services, LLC., dated January 16, 2006 (Incorporated by reference to the exhibits to Form 8-K filed on February 1, 2006)10.16
2006 Non-QualifiedStock Compensation Plan (Incorporated by reference to the exhibits to Form S-8 filed on February 28, 2006)10.19
Share Exchange Agreement with Easy Money Express, Inc., dated March 31, 200610.20
Service Agreement between Easy Money Express and M2 Internet, dated June 16, 2006 (1)10.21
Restated Investment Agreement between the Registrant and Imperial Capital Holdings, dated July 28, 2006 (2)10.22
Restated Registration Rights Agreement between the Registrant and Imperial Capital Holdings, dated July 28, 2006 (2)10.23
Restated Placement Agent Agreement between the Registrant and Brewer Financial Services, dated July 28, 2006 (2)10.24
Letter of Intent between the Registrant and CardMart Plus, dated November 17, 2006 (3)10.25
Termination of Letter of Intent with CardMart Plus, dated February 20, 2007 (4)10.26
Letter Agreement to Acquire Shares between the Registrant and Rochester Capital Partners, dated March 5, 2007 (6)10.27
Acquisition of Hands Free Entertainment (Incorporated by reference to exhibits to Form 8-K, filed on January 4, 2008)10.28
Disposition of LitFundingUSA (Incorporated by reference to exhibits to Form 8-K, filed onApril 8, 2008)10.29
Recession Agreement With Hands Free Entertainment (Incorporated by reference to exhibits to Form 8-K, filed on April 10, 2008)10.30
Exclusive License Agreement with Global Universal Pictures(Incorporated by reference to exhibits to Form 8-K, filed on December 11, 2008)10.31
Music Rights Agreement with B & J Pictures (Incorporated by reference to exhibits to Form 8-K, filed on December 11, 2008)10.32
Guarantee and Amended Exclusive License Agreement with Global Universal Pictures (Incorporated by reference to exhibits to Form 8-K, filed on December 11, 2008)20
Letter to Shareholders dated March 11, 2003 (Incorporated by reference to the exhibits to Form 8-K filed on March 11, 2003)21
List of Subsidiaries : California LitFunding, E.Evolution Expeditions and LitFunding USA (Incorporated by reference to the exhibits to Form 10-KSB filed on March 21, 2005)21.1
List of Subsidiaries : Global Universal Film Group, Global Universal Entertainment (formerly Easy Money Express) and Global Universal Pictures, a Canadian Corporation (30% owned)31.1*
Certification of Gary Rasmussen pursuant to Section 302 of the Sarbanes-Oxley Act31.2*
Certification of Terry Gabby pursuant to Section 302 of the Sarbanes-Oxley Act32.1*
Certification of Gary Rasmussen pursuant to Section 906 of the Sarbanes-Oxley Act32.2*
Certification of Terry Gabby pursuant to Section 906 of the Sarbanes-Oxley Act


* Filed herewith.





Reports on Form 8-K





None.





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SIGNATURES




Pursuant to the requirements 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.








GLOBAL ENTERTAINMENT HOLDINGS, INC.
(Registrant)August 19, 2009
By:
/s/ Terry GabbyTerry GabbyChief Financial Officer











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