SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-Q





QUARTERLY
REPORT UNDER SECTION 13 OR 15(d) OF THE


SECURITIES
EXCHANGE ACT OF 1934







For
      the 3 month period ended
            
            March
      31,2009







Commission
      file number
            
            000-26235







LION
      CAPITAL HOLDINGS, INC.(Name
      of Small Business Issuer in Its
Charter)







Delaware
            
            52-2191043(State
      or other jurisdiction of incorporation or organization)
            
            (I.R.S.
      Employer Identification No.)







8140
      North Mopac, Bldg 1, Ste 125 Austin, Texas
            
            78759(Address
      of principal executive office)
            
            (Zip
      Code)







Issuer's
      telephone number, including area code
            
            (512)
      615-2453







Check
whether the issuer (1) filed all reports required to be filed by Section 13 or
15(d) of the Exchange Act during the past 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes x No o




At March
31, 2009, a total of 14,851,079 shares of registrant's Common Stock were
outstanding.





















TABLE
OF CONTENTS




Page
      NumberPARTI
            
            FINANCIAL
      INFORMATION
            
            3Item1.
            
            Financial
      Statements
            
            3Item2.
            
            Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
            
            8Item3.
            
            Disclosure
      Controls and Procedures
            
            15PARTII
            
            OTHER
      INFORMATION
            
            16Item6.
            
            Exhibits,
      Lists, and Reports on Form 8-K
            
            16Signatures
            
            
            
            17

















Part I - FINANCIAL INFORMATION





Item 1. Financial Statements.


The
following unaudited Financial Statements for the period ended March 31, 2009,
have been prepared by LCHI, Inc.




LION
      CAPITAL HOLDINGS, INC.Condensed
      Consolidated Balance SheetsASSETSMarch
      31,
                                
                                
                                December
      31,2009
                                
                                
                                2008(Unaudited)CURRENT
      ASSETSCash
                                
                                $
                                6,605
                                
                                
                                $
                                3,215Total
      Current Assets
                                
                                
                                6,605
                                
                                
                                
                                3,215PROPERTY
      AND EQUIPMENT, net
                                
                                
                                4,161
                                
                                
                                
                                4,324TOTAL
      ASSETS
                                
                                $
                                10,766
                                
                                
                                $
                                7,539LIABILITIES AND STOCKHOLDERS' EQUITY
      (DEFICIT)CURRENT
      LIABILITIESAccounts
      payable
                                
                                $
                                2,000
                                
                                
                                $
                                4,281Due
      to shareholders and related companies
                                
                                
                                85,548
                                
                                
                                
                                85,548Convertible
      note payable - related company
                                
                                
                                147,500
                                
                                
                                
                                127,500Accrued
      interest on convertible notes payable - related
                                
                                
                                7,339
                                
                                
                                
                                4,978Net
      liabilities of discontinued operations
                                
                                
                                1,698,492
                                
                                
                                
                                1,696,850Total
      Current Liabilities
                                
                                
                                1,940,879
                                
                                
                                
                                1,919,157STOCKHOLDERS'
      EQUITY (DEFICIT)Common
      stock, 150,000,000 shares authorized of $0.001par
      value, 14,851,079 shares issued and outstanding
                                
                                
                                14,851
                                
                                
                                
                                14,851Additional
      paid-in capital
                                
                                
                                3,042,766
                                
                                
                                
                                3,022,766Accumulated
      deficit
                                
                                
                                (4,987,730
                                )
                                
                                
                                (4,949,235
                                )Total
      Stockholders' Equity (Deficit)
                                
                                
                                (1,930,113
                                )
                                
                                
                                (1,911,618
                                )TOTAL
      LIABILITIES AND STOCKHOLDERS'EQUITY
      (DEFICIT)
                                
                                $
                                10,766
                                
                                
                                $
                                7,539
  The
accompanying notes are an integral part of these financial
statements.
 3
  LION
      CAPITAL HOLDINGS, INC.Condensed
      Consolidated Statements of Operations(Unaudited)For
      the Three Months EndedMarch
      31,2009
                                
                                
                                2008REVENUES
                                
                                $
                                -
                                
                                
                                $
                                -OPERATING
      EXPENSESGeneral
      and administrative
                                
                                
                                14,328
                                
                                
                                
                                23,141Depreciation
                                
                                
                                163
                                
                                
                                
                                -Total
      Operating Expenses
                                
                                
                                14,491
                                
                                
                                
                                23,141LOSS
      FROM OPERATIONS
                                
                                
                                (14,491
                                )
                                
                                
                                (23,141
                                )OTHER
      EXPENSESInterest
      expense, including interestexpense
      on beneficial conversion
                                
                                
                                (22,361
                                )
                                
                                
                                (20,000
                                )LOSS
      FROM CONTINUING OPERATIONS
                                
                                
                                (36,852
                                )
                                
                                
                                (43,141
                                )LOSS
      FROM DISCONTINUEDOPERATIONS
                                
                                
                                (1,642
                                )
                                
                                
                                (1,642
                                )NET
      LOSS
                                
                                $
                                (38,494
                                )
                                
                                $
                                (44,783
                                )BASIC
      LOSS PER SHARE
                                
                                $
                                (0.00
                                )
                                
                                $
                                (0.00
                                )WEIGHTED
      AVERAGE NUMBER OFCOMMON
      SHARES OUTSTANDING
                                
                                
                                14,851,079
                                
                                
                                
                                14,851,079
  The
accompanying notes are an integral part of these financial
statements.
 4
  LION
      CAPITAL HOLDINGS, INC.Condensed
      Consolidated Statements of Cash Flows(Unaudited)For
      the Three Months EndedMarch
      31,2009
                            
                            
                            2008CASH
      FLOWS FROM OPERATING ACTIVITIES:Net
      loss
                            
                            $
                            (38,494
                            )
                            
                            $
                            (44,783
                            )Adjustments
      to reconcile net loss to net cashused
      by operating activies:Interest
      expense accretion
                            
                            
                            20,000
                            
                            
                            
                            20,000Depreciation
                            
                            
                            163
                            
                            
                            
                            -Changes
      in operating assets and liabilities:Accounts
      payable and accrued interest
                            
                            
                            79
                            
                            
                            
                            (21,123
                            )Net
      Cash Used in Operating Activities
                            
                            
                            (18,252
                            )
                            
                            
                            (45,906
                            )CASH
      FLOWS FROM INVESTING ACTIVITIES:
                            
                            
                            -
                            
                            
                            
                            -CASH
      FLOWS FROM FINANCING ACTIVITIES:Proceeds
      from convertible note
                            
                            
                            20,000
                            
                            
                            
                            20,000Net
      Cash Provided by Financing Activities
                            
                            
                            20,000
                            
                            
                            
                            20,000Net
      Cash Used in Continuing Operations
                            
                            
                            1,748
                            
                            
                            
                            (25,906
                            )Net
      Cash Used in Discontinued Operations
                            
                            
                            1,642
                            
                            
                            
                            1,642NET
      DECREASE IN CASH
                            
                            
                            3,390
                            
                            
                            
                            (24,264
                            )CASH
      AT BEGINNING OF PERIOD
                            
                            
                            3,215
                            
                            
                            
                            25,669CASH
      AT END OF PERIOD
                            
                            $
                            6,605
                            
                            
                            $
                            1,405SUPPLEMENTAL
      DISCLOSURESInterest
      paid
                            
                            $
                            -
                            
                            
                            $
                            -Taxes
      paid
                            
                            $
                            -
                            
                            
                            $
                            -




The
accompanying notes are an integral part of these financial
statements.
 5
 LION
CAPITAL HOLDINGS, INC.
 Notes to
the Condensed Consolidated Financial Statements
 March 31,
2009 and December 31, 2008







NOTE 1
-       BASIS OF FINANCIAL STATEMENT
PRESENTATION




The
accompanying unaudited condensed consolidated financial statements have been
prepared by the Company 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 generally
accepted accounting principles have been condensed or omitted in accordance with
such rules and regulations.  The information furnished in the interim
condensed consolidated financial statements includes normal recurring
adjustments and reflects all adjustments, which, in the opinion of management,
are necessary for a fair presentation of such consolidated financial
statements.  Although management believes the disclosures and
information presented are adequate to make the information not misleading, it is
suggested that these interim condensed consolidated financial statements be read
in conjunction with the Company's audited consolidated financial statements and
notes thereto included in its December 31, 2008 Annual Report on Form
10-KSB.  Operating results for the nine months ended March 31, 2009
are not necessarily indicative of the results that may be expected for the year
ending December 31, 2009.





NOTE 2
-       LOSS PER SHARE




Following
is a reconciliation of the loss per share for the three months ended March 31,
2009 and 2008:




For
      the Three Months Ended
                                          March
      31,2009
                                        
                                        
                                        2008Net
      (loss) available to common shareholders
                                        
                                        $
                                        (38,494
                                        )
                                        
                                        $
                                        (44,783
                                        )Weighted
      average shares
                                        
                                        
                                        14,851,079
                                        
                                        
                                        
                                        14,851,079Basic
      loss per share (based on weighted average shares)
                                        
                                        $
                                        (0.00
                                        )
                                        
                                        $
                                        (0.00
                                        )


6
 LION
CAPITAL HOLDINGS, INC.
 Notes to
the Condensed Consolidated Financial Statements
 March 31,
2009 and December 31, 2008










NOTE 3
-        GOING CONCERN





As shown
in the accompanying unaudited consolidated financial statements, the Company
incurred a net loss of $38,494 during the three month period ended March 31,
2009 and, as of that date, the Company’s current and total liabilities exceeded
its current assets by $1,934,274. These factors, as well as the uncertain
conditions that the Company faces relative to capital raising activities, create
an uncertainty as to the Company’s ability to continue as a going concern. The
Company is seeking to raise additional capital through public and/or private
placement offerings, targeting strategic partners in an effort to increase
revenues, and expanding revenues through strategic acquisitions.  The
ability of the Company to continue as a going concern is dependent upon the
success of capital offerings or alternative financing arrangements and expansion
of its operations. The unaudited consolidated financial statements do not
include any adjustments that might be necessary should the Company be unable to
continue as a going concern. As of March 31, 2009, the Company had cash and cash
equivalents of $6,605. The Company will require additional funding during the
next twelve months to finance the growth of its current operations and achieve
its strategic objectives.  Management is actively pursuing additional
sources of financing sufficient to generate enough cash flow to fund its
operations through 2009 and 2010. However management cannot make any assurances
that such financing will be secured













NOTE 4
-        CONVERTIBLE NOTE PAYABLE –
RELATED PARTY








During
the three months ended March 31, 2009, the Company executed two separate
“Promissory Convertible Notes” (“Convertible Notes”), for a total of $20,000
with certain related companies.  The notes bear interest at 9.0% per
annum.  Accrued interest on these notes payable at March 31, 2009
totaled $168.





The note
holders have the right to convert the balance owed on these convertible notes,
including interest, into shares of common stock of the Company at $0.01 per
share.  The convertible notes has been accounted for pursuant to EITF
Issue No. 98-5, Accounting for Convertible Securities with Beneficial Conversion
Features or Contingently Adjustable Conversion Ratios, and EITF Issue No. 00-27,
Application of EITF Issue No. 98-5 to Certain Convertible
Instruments.  Accordingly, a beneficial conversion feature (recorded
as interest expense) of $20,000 was recorded for the three months ended March
31, 2009.


7







Item 2. Management's Discussion and Analysis or Plan of
Operation.




The
following is management's discussion and analysis of certain significant factors
that have affected the Company's financial position and operating results during
the periods included in the accompanying consolidated financial statements. The
accompanying unaudited financial statements include all adjustments which in the
opinion of management are necessary for a fair presentation and in order to make
the financial statements not misleading.






Risk
Factors and Cautionary Statements




Forward-looking
statements in this report are made pursuant to the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995. The Company wishes to
advise readers that actual results may differ substantially from such
forward-looking statements. Forward-looking statements involve risks and
uncertainties that could cause actual results to differ materially from those
expressed in or implied by the statements, including, but not limited to, the
following: the ability of the Company to continue as a viable concern
,uncertainties and assumptions relating to our operations, results of
operations, competitive factors, shifts in market demand and other risks and
uncertainties, the ability of the Company to obtain financing in order to
implement its business plan and other risks detailed in the Company's periodic
report filings with the Securities and Exchange Commission.






For this
purpose, any statements that are not statements of historical fact maybe deemed
to be forward-looking statements, including the statements under Management's
Discussion and Analysis of Financial Condition and Results of Operations
regarding our strategy, future operations, future expectations or future
estimates, financial position and objectives of management. Those statements in
this Form 10-Q/A containing the words believes, anticipates, plans, expects and
similar expressions constitute forward-looking statements, although not all
forward-looking statements contain such identifying words. These forward-looking
statements are based on our current expectations and are subject to a number of
risks, uncertainties and assumptions relating to our operations, results of
operations, competitive factors, shifts in market demand and other risks and
uncertainties.






Although
we believe that the assumptions underlying our forward-looking statements are
reasonable, any of the assumptions could be inaccurate and actual results may
differ from those indicated by the forward-looking statements included in this
Form 10-Q/A. In light of the significant uncertainties inherent in the
forward-looking statements included in this Form 10-Q/A, you should not consider
the inclusion of such information as a representation by us or anyone else that
we will achieve such results. Moreover, we assume no obligation to update these
forward-looking statements to reflect actual results, changes in assumptions or
changes in other factors affecting such forward-looking statements.











8





Overview
and Plan of Operation






You
should read the following discussion in conjunction with the consolidated
financial statements and footnotes thereto included in the Company's Quarterly
Report on Form 10-Q/A for the quarter ended March 31, 2009. The consolidated
financial statements and related footnotes included herein include the financial
statements of Lion Capital Holdings, Inc. Lion Capital Holdings, Inc. (the
Issuer or Company or LCHI) was organized under the laws of the State of Delaware
in 1999. LCHI has one subsidiary, Capita lCable and Wire, Inc., dba Austin Cable
and Wire, which was incorporated in 1997as a Texas corporation.






Austin
Cable was acquired by LCHI in 1999 through the sale of a controlling block of
its stock, thus making Austin Cable a wholly-owned subsidiary of LCHI. Austin
Cable is in the business of assembling copper and fiber optic specialty cables
for distribution in the United States.






The
Company produced specialty custom cable assemblies and harnesses for various
industries. A specialty custom cable or harness assembly is a copper or fiber
optic cable with connectors terminated at one or both ends. The specialty custom
cable assembly industry is one that services and supplies a variety of other
industries, which need wire harnesses and cable assemblies for their
products.






In 1999,
LCHI also acquired all but one share of TIC Cables Electronica y Suministros,
S.A. de C.V., incorporated in Mexico in 1989, thus making TIC a99.99%-owned
subsidiary of LCHI. As TIC is engaged in the design and integration of systems
for data and LCHIunications in Mexico, LCHI management believed the acquisition
would provide strategic competitive advantages, which proved true throughout
most of 2000. However, in 2001, due to a lack of control over operations at TIC,
the difficulty in the Mexican economy and excessive losses at TIC's facilities
in Mexico, LCHI's Board of Directors, in a meeting held September 6, 2001, voted
to abandon TIC operations. LCHI has divested itself of its interest in TIC and
is in the process of returning all TIC shares to its president, Jesus Aguirre.
We have not legally transferred our ownership interest in TIC to Mr. Aguirre,
and based on consultation with legal counsel, LCHI does not have any continuing
or contingent liabilities related to TIC.






From its
inception through mid 2003, the Company was engaged in the business of
manufacturing both copper and fiber optic specialty custom cabling for the data
and telecommunications industries. In addition to its one subsidiary, Capital
Cable & Wire, Inc., the company had aggressively sought acquisitions to
further increase its sales in this industry. The Company had not, however, been
successful in closing any acquisitions. As such, management, together with the
company's board of directors, decided to forgo all such acquisition activities
and has corporately decided to shift its core business focus. The Company will
no longer be principally engaged in the business of manufacturing copper and
fiber optic cables. Capital Cable, dba Austin Wire & Cable, will continue to
operate as a subsidiary of Lion Capital Holdings, Inc., and will heretofore
account for 100% of the Company's interests in the custom cable
industry.









9







Lion
Capital is now seeking a reverse merger candidate.






Lion
Capital was in discussions with Sun Motor, a reverse merger candidate, based in
China, but the discussions broke down due to certain frivolous legal actions
brought against Lion Capital by Elaine Selan vs Andrew Stack et al. As of this
filing, the trial judge has entered an order dismissing with prejudice the
claims of the plaintiff, Elaine Selan, but the litigation continues as to Lion
Capital’s counterclaim and an attempt by a third party, SIAD, US, Inc to
intervene. Lion Capital filed a form 8-K/A dated May 19, 2005 to this effect.
Although the transaction with Sun Motor has collapsed, Lion Capital continues to
seek prospective merger candidates, but, at the time of this report, has been
unsuccessful in finding a suitable candidate.






In July
2006, Lion Capital was again involved in another frivolous law suit brought
against Lion Capital by 3Dicon, Inc vs Andrew Stack et al. As of this filing the
case is still open and has not reached trial. Lion Capital was not part of this
transaction involving Andrew Stack and 3Dicon and is cooperating with the
plaintiffs in order to resolve any issues and be dismissed from the case. If
Lion Capital is not dismissed from this case, then there is a possibility that
Lion Capital will have to seek bankruptcy since it does not have the funds to
adequately defend itself.





On March
27, 2009, Lion Capital entered into an irrevocable letter of intent to acquire
100% of DeFi Mobile Ltd,,a privately held telecommunications company. The
acquisition is subject to the entry into a material definitive agreement
regarding the transaction, shareholder approvals, if applicable, and the
satisfaction or waiver of certain conditions customary to transactions of this
type.  The Company intends to complete the transaction on or before
May 30, 2009. The timing and completion of the acquisition is subject to
shareholder approval of DeFi Mobile Ltd., applicable securities laws and other
factors. There can be no assurance that this transaction will be completed in a
timely manner if at all.









GOING
CONCERN






As shown
in the accompanying unaudited financial statements, the Company incurred a net
loss of $38,494 on revenues of $0 during the 3 month period ended March 31, 2009
and, as of that date, the Company's current and total liabilities exceeded its
current and total assets by $1,930,113. These factors, as well as the uncertain
conditions that the Company faces relative to capital raising activities, create
an uncertainty as to the Company's ability to continue as a going concern. The
Company is seeking to raise additional capital through public and/or private
placement offerings, targeting strategic partners in an effort to increase
revenues, and expanding revenues through strategic acquisitions. The ability of
the Company to continue as a going concern is dependent upon the success of
capital offerings or alternative financing arrangements and expansion of its
operations. The unaudited financial statements do not include any adjustments
that might be necessary should the Company be unable to continue as a going
concern. As of March 31, 2009, the Company had cash and cash equivalents of
$6,605. We will require additional funding during the next 12 months to finance
the growth of our current operations and achieve our strategic objectives. Our
management is actively pursuing additional sources of financing sufficient to
generate enough cash flow to fund our operations through 2009 and 2010. However
we cannot make any assurances that such financing will be secured.









10





RESULTS
OF OPERATIONS






Revenues
for the three months period ended March 31, 2009 were $0, compared to revenues
of $0 for the same period ended March 31, 2008.





General
and administrative costs for the three months period ended March 31, 2009 were
$14,328 compared to $23,141 for the same period ended March 31, 2008. General
and administrative costs were slightly lower due to efforts made by management
to reduce costs and limit expenditure due the slowdown in the
economy.





Net
Losses for the three months ended March 31, 2009 were $38,494 compared to net
losses of $44,783 for the same period ended March 31, 2008. The net losses are
primarily attributable to general and administrative expenses as well as
interest expenses totaling $22,361. General and administrative expenses include
financing costs, accounting costs, consulting fees, leases, employment costs,
professional fees, and costs associated with the preparation of disclosure
documentation.




The
Company expects to continue to incur losses through the fiscal year ended 2009
and, due to the lack of business opportunities, we cannot determine whether we
will generate future revenues from operations.





Income
Tax Expense (Benefit)




The
Company has a prospective income tax benefit resulting from a net operating loss
carryforward and start up costs that could offset any future operating
profit.




Impact
of Inflation




The
Company believes that inflation has had a negligible effect on operations over
the past three years.




Capital
Expenditures





The
Company expended $0 on capital equipment for the three months to March 31,
2009.





Liquidity
and Capital Resources





The
Company, since inception, has experienced significant changes in liquidity,
capital resources, and stockholders’ equity.





As of
March 31, 2009, the Company had current assets totaling $6,605 and a working
capital deficit of $1,934,274. Our assets consisted of cash on hand of $6,605
and property and equipment of $4,161, totaling $10,766. Current liabilities
totaled $1,940,879, which consisted of accounts payable of $2,000, amounts due
to shareholders and related parties of $85,548, convertible notes payable to
related parties of $147,500, accrued interest on convertible notes of $7,339 and
net liabilities of discontinued operations of $1,698,492. Net stockholders’
deficit in the Company was $1,930,113 at March 31, 2009.





Cash
flow used in operating activities for the three months period ended March 31,
2009 was $18,252 as compared to $45,906 in cash flow used in operating
activities for the three months period ended March 31, 2008. The cash flow used
in operating activities in the current three months period was due primarily to
net losses.





Cash flow
used in investing activities for the three months period ended March 31, 2009
was $0 as compared to $0 for the three months period ended March 31,
2008.





Cash flow
provided by financing activities for the three months period ended March 31,
2009 was $20,000 as compared to $20,000 for the three months period ended March
31, 2008. Cash flow provided by financing activities in the current three months
period was due to proceeds from convertible loans of $20,000.








11





The
Company’s current assets are insufficient to conduct its intended plan of
operation over the next twelve (12) months and it will have to realize debt or
equity financing to fund its operations. We have no current commitments or
arrangements with respect to funding or immediate sources of funding. Further,
no assurances can be given that funding would be available or available to us on
acceptable terms. Therefore, our stockholders would be the most likely source of
new funding in the form of loans or equity placements though none have made any
commitment for future investment and we have no agreement formal or otherwise.
Our inability to obtain fundingwould have a material
adverse affect on our plan of operation.





The
Company had no formal long term lines or credit or other bank financing
arrangements as of March 31, 2009.




The
Company does not expect to pay cash dividends in the foreseeable
future.





The
Company has no defined benefit plan or contractual commitment with any of its
officers or directors.





The
Company has no current plans for any significant purchase or sale of any plant
or equipment.





The
Company has no current plans to make any changes in the number of
employees.





Off
Balance Sheet Arrangements





As of
March 31, 2009, we have no significant 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 of
operations, liquidity, capital expenditures, or capital resources that is
material to stockholders.




Critical
Accounting Policies





In the
notes to the audited financial statements for the year ended December 31, 2008,
included in the Company’s Form 10-K, the Company discusses those accounting
policies that are considered to be significant in determining the results of
operations and our financial position. The Company believes that the accounting
principles utilized by us conform to accounting principles generally accepted in
the United States of America.




The
preparation of financial statements requires management to make significant
estimates and judgments that affect the reported amounts of assets, liabilities,
revenues and expenses. By their nature, these judgments are subject to an
inherent degree of uncertainty. On an on-going basis, the Company evaluates our
estimates, including those related to bad debts, inventories, intangible assets,
warranty obligations, product liability, revenue, and income taxes. We base our
estimates on historical experience and other facts and circumstances that are
believed to be reasonable, and the results form the basis for making judgments
about the carrying value of assets and liabilities. The actual results may
differ from these estimates under different assumptions or
conditions.





Stock-Based
Compensation




The
Company has adopted SFAS No. 123 (revised 2004) (SFAS No. 123R), Share-Based
Payment, which addresses the accounting for stock-based payment transactions in
which an enterprise receives employee services in exchange for (a) equity
instruments of the enterprise or (b) liabilities that are based on the fair
value of the enterprise’s equity instruments or that may be settled by the
issuance of such equity instruments. In January 2005, the Securities and
Exchange Commission (SEC) issued Staff Accounting Bulletin (SAB) No. 107, which
provides supplemental implementation guidance for SFAS No. 123R. SFAS No. 123R
eliminates the ability to account for stock-based compensation transactions
using the intrinsic value method under Accounting Principles Board (APB) Opinion
No. 25, Accounting for Stock Issued to Employees, and instead generally requires
that such transactions be accounted for using a fair-value-based method. We use
the Black-Scholes-Merton (“BSM”) option-pricing model to determine the
fair-value of stock-based awards under SFAS No. 123R, consistent with that used
for pro forma disclosures under SFAS No. 123, Accounting for Stock-Based
Compensation. We have elected the modified prospective transition method as
permitted by SFAS No. 123R and accordingly prior periods have not been restated
to reflect the impact of SFAS No. 123R. The modified prospective transition
method requires that stock-based compensation expense be recorded for all new
and unvested stock options, restricted stock, restricted stock units, and
employee stock purchase plan shares that are ultimately expected to vest as the
requisite service is rendered beginning on September 1, 2005, the first day of
our fiscal year 2006. Stock-based compensation expense for awards granted prior
to September 1, 2005 is based on the grant date fair-value as determined under
the pro forma provisions of SFAS No. 123. Prior to the adoption of SFAS No.
123R, we measured compensation expense for our employee stock-based compensation
plans using the intrinsic value method prescribed by APB Opinion No.
25.








12














We
applied the disclosure provisions of SFAS No. 123 as amended by SFAS No. 148,
Accounting for Stock-Based Compensation – Transition and Disclosure, as if the
fair-value-based method had been applied in measuring compensation expense.
Under APB Opinion No. 25, when the exercise price of the Company’s employee
stock options was equal to the market price of the underlying stock on the date
of the grant, no compensation expense was recognized.     We account for
equity instruments issued in exchange for the receipt of goods or services from
other than employees in accordance with SFAS No. 123 and the conclusions reached
by the Emerging Issues Task Force (“EITF”) in Issue No. 96-18. Costs are
measured at the estimated fair market value of the consideration received or the
estimated fair value of the equity instruments issued, whichever is more
reliably measurable. The value of equity instruments issued for consideration
other than employee services is determined on the earliest of a performance
commitment or completion of performance by the provider of goods or services as
defined by EITF 96-18




Recent
Accounting Pronouncements




In March
2008, the FASB issued SFAS 161 which amends and expands the disclosure
requirements of SFAS 133 to provide an enhanced understanding of an entity’s use
of derivative instruments, how they are accounted for under SFAS 133 and their
effect on the entity’s financial position, financial performance and cash flows.
The provisions of SFAS 161 are effective for the period beginning after November
15, 2008. We are currently reviewing the effect, if any, that the adoption of
this statement will have on our financial statements.





In May
2008, the FASB issued SFAS 162 which identifies the sources of accounting
principles and the framework for selecting the principles to be used in the
preparation of financial statements of nongovernmental entities that are
presented in conformity with generally accepted accounting principles (GAAP) in
the United States (the GAAP hierarchy). We are currently reviewing the effect,
if any, that the adoption of this statement will have on our financial
statements.     In May 2008, the FASB issued SFAS 163 which clarifies how
SFAS 60 applies to financial guarantee insurance contracts, including the
recognition and measurement to be used to account for premium revenue and claim
liabilities. We are currently reviewing the effect, if any, that the adoption of
this statement will have on our financial statements.





Forward
Looking Statements and Factors That May Affect Future Results and Financial
Condition





The statements contained in the
section titled “ Management ’ s Plan of Operations, ” with the exception of
historical facts, are forward looking statements. Forward looking statements
reflect our current expectations and beliefs regarding our future results of
operations, performance, and achievements. These statements are subject to risks
and uncertainties and are based upon assumptions and beliefs that may or may not
materialize. These statements include, but are not limited to, statements
concerning:






•
            our
      anticipated financial performance and business
  plan;


•
            the
      sufficiency of existing capital
resources;


•
            our
      ability to raise additional capital to fund cash requirements for future
      operations;


•
            uncertainties
      related to the Company's future business
  prospectus;


•
            our
      ability to generate revenues from future
  operations;


•
            the
      volatility of the stock market;
and,


•
            general
      economic conditions.




We wish
to caution readers that our operating results are subject to various risks and
uncertainties that could cause our actual results to differ materially from
those discussed or anticipated, including the factors set forth in the section
entitled “ Risk Factors, ” below. We also wish to advise readers not to place
any undue reliance on the forward looking statements contained in this report,
which reflect our beliefs and expectations only as of the date of this report.
We assume no obligation to update or revise these forward looking statements to
reflect new events or circumstances or any changes in our beliefs or
expectations, other than is required by law.








Risks
Factors


Our future operating results
are highly uncertain. Before deciding to invest in us or to maintain or increase
your investment, you should carefully consider the risks described below, in
addition to the other information contained in our annual report. If any of
these risks actually occur, our business, financial condition or results of
operations could be seriously harmed. In that event, the market price for our
common stock could decline and you may lose all or part of your
investment.







13


We
have a history of significant operating losses and such losses may continue in
the future.





Since our inception in 1999,
our operation has resulted in continuing losses and an accumulated deficit of
$4,949,235 at December 31, 2008, which increased to $4,987,730 at March 31,
2009. We expect to incur losses as long as we continue to generate revenues that
are insufficient to cover our expenses. Our only expectation of overcoming
future losses is dependent on our ability to acquire or develop new business,
which eventuality can in no way be assured.




The
Company’s limited financial resources cast severe doubt on our ability to
acquire or develop a revenue producing business.




Our
future operation is dependent on our ability to generate new revenue sources.
However, the prospect of such sources is doubtful due to the Company’s limited
financial resources which limitation may act as a deterrent in future revenues.
Should we be unable to improve our financial condition through debt or equity
offerings our ability to generate new revenue will be severely limited to the
extent that the Company will, in all likelihood, be forced to cease
operations.





The
Company remains dependent on financing arrangements to continue
operations.





Our
continued operation is dependent on funding provided through private debt or
equity placements or by major shareholders in the form of loans. We expect that
the Company’s dependence on funding to maintain operations will continue until
such future time when a new revenue producing business can sustain its operating
requirements. Despite this dependence, the Company has no commitments in place
for additional funding.





The
market for our stock is limited and our stock price may be
volatile.





The
market for our common stock has been limited due to low trading volume and the
small number of brokerage firms acting as market makers. Because of the
limitations of our market and volatility of the market price of our stock,
investors may face difficulties in selling shares at attractive prices when they
want to. The average daily trading volume for our stock has varied significantly
from week to week and from month to month, and the trading volume often varies
widely from day to day.




We
may incur significant expenses as a result of being quoted on the Over the
Counter Bulletin Board, which may negatively impact our financial
performance.





We may
incur significant legal, accounting and other expenses as a result of being
listed on the Over the Counter Bulletin Board. The Sarbanes-Oxley Act of 2002,
as well as related rules implemented by the Commission has required changes in
corporate governance practices of public companies. We expect that compliance
with these laws, rules and regulations, including compliance with Section 404 of
the Sarbanes-Oxley Act of 2002 as discussed in the following risk factor, may
substantially increase our expenses, including our legal and accounting costs,
and make some activities more time-consuming and costly. As a result, there may
be a substantial increase in legal, accounting and certain other expenses in the
future, which would negatively impact our financial performance and could have a
material adverse effect on our results of operations and financial condition.





Our
internal controls over financial reporting may   be considered ineffective,
which could result in a loss of investor confidence in our financial reports and
in turn have an adverse effect on our stock price.





Pursuant
to Section 404 of the Sarbanes-Oxley Act of 2002 we are required to furnish a
report by our management on our internal controls over financial reporting. Such
report must contain, among other matters, an assessment of the effectiveness of
our internal controls over financial reporting as of the end of the year,
including a statement as to whetheror not our internal
controls over financial reporting are effective. This assessment must include
disclosure of any material weaknesses in our internal controls over financial
reporting identified by management. If we are unable to assert that our internal
controls are effective, our investors could lose confidence in the accuracy and
completeness of our financial reports, which in turn could cause our stock price
to decline.




14


The
Company’s shareholders may face significant restrictions on their
stock.





The
Company’s stock differs from many stocks in that it is a “penny stock.” The
Commission has adopted a number of rules to regulate “penny stocks” including,
but not limited to, those rules from the Securities Act as follows:







3a51-1     which
      defines penny stock as, generally speaking, those securities which are not
      listed on either NASDAQ or a national securities exchange and are priced
      under $5, excluding securities of issuers that have net tangible assets
      greater than $2 million if they have been in operation at least three
      years, greater than $5 million if in operation less than three years, or
      average revenue of at least $6 million for the last three
      years;


15g-1     which
      outlines transactions by broker/dealers which are exempt from 15g-2
      through 15g-6 as those whose commissions from traders are lower than 5%
      total commissions;


15g-2
           which details that brokers must disclose
      risks of penny stock on Schedule
15G;


15g-3
           which details that broker/dealers must
      disclose quotes and other information relating to the penny stock
      market;


15g-4
           which explains that compensation of
      broker/dealers must be disclosed;


15g-5
           which explains that compensation of persons
      associated in connection with penny stock sales must be
      disclosed;


15g-6
           which outlines that broker/dealers must send
      out monthly account statements; and


15g-9     which
      defines sales practice
requirements.







Since the
Company’s securities constitute a “penny stock” within the meaning of the rules,
the rules would apply to us and our securities. Because these rules provide
regulatory burdens upon broker-dealers, they may affect the ability of
shareholders to sell their securities in any market that may develop; the rules
themselves may limit the market for penny stocks. Additionally, the market among
dealers may not be active. Investors in penny stock often are unable to sell
stock back to the dealer that sold them the stock. The mark-ups or commissions
charged by the broker-dealers may be greater than any profit a seller may make.
Because of large dealer spreads, investors may be unable to sell the stock
immediately back to the dealer at the same price the dealer sold the stock to
the investor. In some cases, the stock may fall quickly in value. Investors may
be unable to reap any profit from any sale of the stock, if they can sell it at
all.





Shareholders
should be aware that, according to Commission Release No. 34-29093 dated
April 17, 1991, the market for penny stocks has suffered from patterns of
fraud and abuse. These patterns include:




- control of the market for the security by one or a few
  broker-dealers that are often related to the promotor or issuer;
- manipulation of prices through prearranged matching of purchases
  and sales and false and misleading press releases;
- "boiler room" practices involving high pressure sales tactics and
  unrealistic price projections by inexperiences sales persons;
- excessive and undisclosed bid-ask differentials and markups by
  selling broker-dealers; and
- the wholesale dumping of the same securities by promotors and
  broker-dealers after prices have been manipulated to a desired level, along
  with the inevitable collapse of those prices with consequent investors
  losses.




Item 3. Disclosure Controls and Procedures





Evaluation
of Disclosure Controls and Procedures





In
connection with the preparation of this report on Form 10-QSB, an evaluation was
carried out by the Company’s management, with the participation of the chief
executive officer and the chief financial officer, of the effectiveness of the
Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and
15d-15(e) under the Securities Exchange Act of 1934 (“Exchange Act”)).
Disclosure controls and procedures are designed to ensure that information
required to be disclosed in reports filed or submitted under the Exchange Act is
recorded, processed, summarized, and reported within the time periods specified
in the Commission’s rules and forms and that such information is accumulated and
communicated to management, including the chief executive officer and the chief
financial officer, to allow timely decisions regarding required disclosures.





Based on
that evaluation, the Company’s management concluded, as of the end of the period
covered by this report, that the Company’s disclosure controls and procedures
were effective in recording, processing, summarizing, and reporting information
required to be disclosed, within the time periods specified in the Commission’s
rules and forms.










15





Changes
in Internal Control over Financial Reporting




There
have been no changes in internal control over financial reporting (as defined in
Rule 13a-15(f) of the Exchange Act) during the period ended March 31, 2009, that
materially affected, or are reasonably likely to materially affect, the
Company’s internal control over financial reporting.






PART II. OTHER INFORMATION





ITEM
1.     LEGAL PROCEEDINGS




None.




ITEM
2.     UNREGISTERED SALES OF EQUITY
SECURITIES




None.





ITEM
3.     DEFAULTS ON SENIOR SECURITIES




None.




ITEM
4.     MATTERS SUBMITTED TO A VOTE OF SECURITY
HOLDERS




None.





ITEM
5.     OTHER INFORMATION




None.




ITEM 6. EXHIBITS AND REPORTS ON FORM
8-K


Exhibits
required to be attached by Item 601 of Regulation S-B are listed in the Index to
Exhibits on page 19 of this Form 10-QSB, and are incorporated herein by this
reference.





(a)
Exhibits.






Exhibit
      No.
              
              Exhibit31.1
              
              Certification
      of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
      Act of 200232.1
              
              Certification
      of Chief Executive Officer Pusuant to Section 906 of the Sarbanes-Oxley
      Act of 2002








(b)
Reports on Form 8-K.





None.










16










Signatures





The
undersigned officers certify that this Quarterly Report on Form 10-Q complies
with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act
of 1934, and the information contained in such report fairly represents, in all
material respects, the financial condition and results of operations of the
Company.


LION
      CAPITAL HOLDINGS, INC.Date:
      May 18, 2009
            
            /s/
      Tim PageTim
      Page, President and Chief Executive Officer

























17