UNITED STATES
                            SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC  20549

                                        Form 10-KSB

[X]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
[FEE REQUIRED]

                                  For the Fiscal Year ended:

                                      December 31, 1997

                                              OR
         [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
                          OF THE SECURITIES EXCHANGE ACT OF 1934
                                  [NO FEE REQUIRED]
                              Commission File No. 0-15435

                        FIRST ENTERTAINMENT HOLDING CORP.
                        (Formerly First Entertainment, Inc.).
          (Name of Small Business Issuer as Specified in its Charter)

         Nevada                                      84-0974303
 (State or Other Jurisdiction of                (I.R.S. Employer
 Incorporation or Organization)                Identification Number)

                        7887 E. Bellview, Suite 1114
                             Englewood, CO 80111
                  (Address of Principal Executive Offices, Including 
                                     Zip Code)

Registrant's telephone number, including area code:  (303) 228-1650

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

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, $.008 Par Value
(Title of Class)

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 was required to file such reports), and (2) has 
been subject to such filing requirements for the past 90 days.  

Yes   X       No      

Check if there are no disclosure of delinquent filers in response to 
Items 405 of Regulation S-B in this form, and no disclosure will be 
contained, to the best of registran's knowledge, in definitive proxy 
or information statements incorporated by reference n Part III of this 
Form 10-KSB or any amendments to this Form 10-KSB.  [   ]

State issuer's revenues for its most recent fiscal year. $2,324,091

As of September 30, 1998, there were 8,803,837 shares of common stock 
(the Registrant's only class of voting stock) outstanding.  The 
aggregate market value of the 7,135,724 shares of common stock of the 
Registrant held by nonaffiliates on September 30, 1998 was 
approximately $ 1,498,502 (based on the mean of the closing bid and 
asked prices).  

Documents incorporated by reference:  None

INDEX TO FORM 10-KSB


PART I

 Item 1     Description of Business

 Item 2     Description of Property

 Item 3      Legal Proceedings

 Item 4     Submission of Matters to a Vote of 
            Security Holders

PART II

 Item 5      Market for Common Equity and Related
             Stockholder Matters

 Item 6      Management's Discussion and Analysis or
             Plan of Operation

 Item 7     Financial Statements

 Item 8     Changes in and Disagreements with Accountants
            on Accounting and Financial Disclosure

PART III

 Item 9     Directors, Executive Officers, Promoters and
            Control Persons

 Item 10     Executive Compensation

 Item 11     Security Ownership of Certain Beneficial Owners
             and Management

 Item 12     Certain Relationships and Related Transactions

PART IV

 Item 13      Exhibits, Lists and Reports on Form 8K
                   A)  Exhibits
                   B)  Reports on Form 8-K

PART I
Item 1.  Description of Business

On December 15, 1997, First Entertainment, Inc. changed its state of 
incorporation from Colorado to Nevada and changed its name to First 
Entertainment Holding Corp. (the "Company" or "FEHC").  The 
Company was originally incorporated under the laws of Colorado on 
January 17, 1985.  

Currently, the Company is a multi-media entertainment conglomerate, 
holding controlling interests in five distinct segments, two active 
and three non operating.  The two active segments, which are 
overviewed by the parent company, FEHC, are known as "Radio," and 
"Live Entertainment.  The non operating segments are known as 
"Film", "Retail" and "Internet".  In November 1995, the Company 
determined to discontinue the operations of its copyrighted 
properties segment, and it was sold in 1996.  Initially, the 
Company's business consisted of the production of pre-recorded 
travel guides and special interest videos.  In 1987, the Company 
entered the radio broadcasting business by acquiring Quality 
Communications, Inc., a Wyoming corporation pursuant to which the 
Company operates the radio segment of its business.  In 1992, the 
Company acquired a controlling interest in First Films, Inc. 
("FFI"), a publicly held Colorado corporation, under which its film 
and live entertainment operations are undertaken.  In December 1996, 
the Company commenced operations of selling infomercial products in 
freestanding unmanned kiosks in major retail malls including U.S. 
Military bases.  This segment was known as the "retail" segment.  
In January, 1998 the Company determined to discontinue the 
operations of the "retail" segment as a result of lower than 
expected sales.  In December 1997 the Company acquired an interest 
in Global Internet Corp. (Global Internet).  Global Internet is a 
development stage company whose planned business activity was to 
commence operations of an internet gaming site.  The investment in 
Global Internet was written off as of December 31, 1997.

Radio

In October 1987, the Company entered the radio broadcasting business 
through the acquisition of Quality Communications, Inc. ("Quality 
Communications"), a Wyoming corporation.  At that time, Quality 
Communications owned and operated three radio stations, which serve 
markets in Northeast Wyoming and central Iowa.  In August 1989, the 
Company sold two radio stations in Boone, Iowa.  

The Company, through Quality Communications, operates a radio 
station, 100.7, The Fox, located in Gillette, Wyoming.

In November 1993, the Company changed the music format of the radio 
station formerly known as KGWY, or Y-100, from a top-40 station to a 
format known as the "Heart of Rock."  In February, 1995 the format 
was changed again to contemporary country.  The changes have had a 
positive effect on its market share and gross revenues.  Independent 
market surveys show the radio station has approximately 44% of the 
market in Gillette, Wyoming.  In 1996, the radio station started 
promoting concerts using up and coming country and western singers.  
The radio station was a venue to promote the concerts and add an 
additional source of revenue for the radio station.

	Live Entertainment

FFI acquired 100 percent of the outstanding stock of Comedy Works, 
Inc., a Colorado corporation, on September 13, 1990 in an exchange 
for 200,000,000 shares of common stock.  Comedy Works was 
incorporated in 1982 and has operated one comedy club from its 
Larimer Square, Denver, Colorado location since that time.  Comedy 
Works Larimer Square typically has ten shows per week and has 
averaged over 2,000 customers per week for the past fifteen years.

The goal of Comedy Works is to produce first-rate shows in the 
theater environment.  Revenues are generated through both ticket 
sales at the door and beverage and food sales at tables.  The club is 
open to the public only for shows, which last from 1 to 2 hours each, 
and number as many as three per night.  Non-show times are devoted to 
preparing and producing a show that changes completely each week, and 
to promoting and marketing the nightclub.  

Video

Initially, the Company entered the pre-recorded videocassette 
product market through the design, production and distribution of 
pre-recorded videocassette travel guides and later expanded into 
production and distribution of special interest videocassette 
productions.

In 1995, the Company signed a three year distribution agreement with 
Fox Lorber, whereby Fox Lorber would test the distribution of 12 
video trip titles in North America.  Fox Lorber had the right to 
acquire the remaining 28 video trip titles and extend the term of 
the agreement from three years to seven years with an additional 
advance royalty payment of $58,000.  During 1996, the Company sold 
all its foreign distribution rights to Fox Lorber for $50,000 and is 
no longer active in the video market.

Retail  

In December 1996, the Company commenced operations of its retail 
segment through its subsidiary, "The Best of As Seen On TV, Inc." 
(ASOTV).  The segment consisted of selling the most common and most 
popular infomercial products in free standing un-manned kiosks in 
retail outlets throughout the United States.  The Company opened its 
first four unmanned locations in December, 1996, in Pearl Harbor, 
Andrews Air Force Base and Bolling Air Force Base in Washington, 
D.C. and Lechmere's in Cambridge, Massachusetts.  In March 1997, the 
Company terminated its unmanned kiosk operations when the leases to 
its first four locations were not renewed.  Sales volumes at the 
unmanned kiosk locations were not sufficient to maintain profitable 
operations.  The Company turned its efforts to operating manned 
kiosks in major retail malls.  Each manned kiosk was approximately 
250 square feet and sold the top 50 selling infomercial products.  
Commencing August, 1997, the Company opened six manned kiosk 
location in six retail malls located in the Denver metropolitan 
area.  The sales volumes for the manned kiosks were less than 
projected and in January 1998, the Company determined to discontinue 
the operations of ASOTV due to operating losses and lack of working 
capital to further develop the concept 

The result of operations of ASOTV for the years ended December 31, 
1997 and 1996 are disclosed as discontinued operations.

The assets of ASOTV were written down to their estimated net 
realizable value resulting in a write down of $490,000 which is 
included in the accompanying statement of operations for the year 
ended December 31, 1997 as part of the loss from discontinued 
operations.

Internet Activities

On May 1, 1997, the Company entered into an agreement with Global 
Casino, Inc. (Global Casino) to acquire 1,500,000 shares of common 
stock of Global Internet Corp. owned by Global Casino and a $375,000 
note receivable from Global Internet owed to Global Casino in 
exchange for 30,000 shares of FEHC Class B Convertible Stock (Class 
B Stock).  Each share of Class B stock is convertible into 12.5 
shares of FEHC restricted  common stock.  At the time FEHC entered 
into the Agreement, FEHC did not have a sufficient number of 
authorized but unissued shares of common stock to allow for the 
conversion of the preferred stock to common stock.  In addition, the 
acquisition of Global Internet required the approval of the 
shareholders of FEHC.  On December 5, 1997 the shareholders of FEHC 
approved (i) the increase in the authorized shares of FEHC common 
stock and (ii) the acquisition of Global Internet Corp.  For 
accounting purposes control of Global Internet did not change until 
December 5, 1997 and, as such, December 5, 1997 is considered the 
acquisition date. 

In June 1997, FEHC issued 14,080 shares of Class B convertible 
preferred stock to two officers of Global Internet, in exchange for 
$176,000 of accrued but unpaid compensation.  Global Internet owed 
the two officers compensation under the terms of long term 
employment agreements.  For accounting purposes the Class B 
convertible preferred shares issued was recorded on December 5, 
1997, the date the shareholders of FEHC approved an increase in the 
authorized shares of common stock.


Global Internet was in the process of developing a virtual internet 
casino and had a Web Site Development and Maintenance Agreement 
(Development Agreement) with Electronic Data Systems (EDS) and DDB 
Needham to develop the web site for approximately $1,200,000, of 
which $300,000 had been expended to date on the web site 
development.  FEHC was unable to obtain the financing needed to 
complete the web site development and the Development Agreement was 
terminated. 

In December, 1997 Global Transaction Services, Ltd, a wholly owned 
subsidiary of Global Internet, was issued an internet gaming license 
from the Commonwealth of Dominica to establish and operate a 
computer based gaming business operating exclusively as an off-shore 
business.  The license is for a period of five years.  In order to 
maintain the license, operations must commence within one year and 
continue without significant interruption throughout its term.  

In accordance with the terms of an agreement dated December 15, 
1997, if funding of at least $1 million was not received by Global 
Internet by February 28, 1998, Global Internet will sell to Anthony 
Kay all of the shares of Global Transaction Services, Ltd. for 
$17,000.  Anthony Kay was a former officer and director of Global 
Internet and resigned March, 1998.

On March 2, 1998, Global Internet was notified of its default under 
the December 15, 1997 agreement and the shares of Global Transaction 
Services, Ltd which holds the gaming license, were sold back to 
Anthony Kay.  

On July 30, 1998, the Company repurchased all of the issued and 
outstanding shares of Global Transaction Services Ltd. from Anthony 
Kay by issuing 50,000 shares of common stock of FEHC.

The ability of the Company to obtain the necessary financing to 
commence operations of a virtual internet casino is uncertain and as 
such the Company's investment in Global Internet was determined by 
management to be impaired.  Included in the accompanying 
consolidated statements of operations for the year ended December 
31, 1997 is an impairment write-off of approximately $558,000 
representing the Company's investment in Global Internet.

Other Business Developments

Balzac

In April 1996, the Company acquired certain assets from Balzac, 
Inc., a private company which manufactures and distributes toys, 
including a product line of toy balls.  The assets and rights 
acquired consisted of the following: inventory of toy balls, the 
exclusive license to sell Balzac products in Australia and various 
other rights. 

The exclusive license agreement for Australia was acquired for 
$800,000 payable within five years based upon a formula of 60% of 
net profits from the sale of Balzac products in Australia.  The 
inventory and various other rights were acquired by issuing 
1,100,000 shares of the Company's restricted common stock valued at 
$1.2 million.  In addition, the Company granted certain stock 
options to Balzac to purchase shares of common stock of the Company.
	
	During 1996, a dispute arose between the Company and Balzac where 
Balzac asserted a violation of the Purchase Agreement.  Balzac 
seized the inventory valued at $1 million, which was collateral on 
the fixed obligation due under the Australian Licensing Agreement, 
to satisfy the $800,000 obligation under the Licensing Agreement.  
The Company asserted that Balzac had no right under the Purchase 
Agreement or License Agreement to seize the inventory and apply the 
proceeds against the note obligation under the License Agreement.

In April 1997, Balzac and the Company entered into a Settlement 
Agreement whereby Balzac will buy back the exclusive Australian 
License for $800,000 and will repay the Company $200,000 which was 
the difference between the value of the seized inventory and the 
obligation under the licensing agreement.  The $1,000,000 will be 
repaid over forty months at 8% per annum by liquidating a minimum of 
25,000 shares of common stock of FEHC per quarter held by Balzac, 
Inc.  The Company would be paid any portion of the sales price per 
shares up to $1.00 and Balzac would retain any portion of the sales 
price over $1.00 per share.  Any unsold stock after 40 months will 
become the property of FEHC.  The ability of Balzac to sell all 
1,000,000 shares held by Balzac at a price of $1.00 to repay its 
obligation was determined by management to be unlikely.  The common 
stock of FEHC has traded at below $1.00 since August, 1997 and on 
February 5, 1998, the Company was delisted from NASDAQ.  As of 
December 31, 1997 the note receivable from Balzac was determined to 
be impaired and was written down to its net realizable value of 
$81,340 resulting in an impairment loss of approximately $902,000.

Image Marketing Group

On September 6, 1994, the Company acquired an 84 percent interest in 
Image Marketing Group, Inc. ("Image") by issuing 248,297 shares of 
its restricted common stock in exchange for 1,986,374 issued and 
outstanding shares of Image.  In addition, the Company issued 
231,976 shares of its Class B preferred stock in exchange for all 
the issued and outstanding preferred stock of Image and 
approximately $420,000 of related party debt.

Image had a substantial amount of working capital invested in 
inventory items that were not selling; therefore, it was unable to 
recover its investment in its inventory or reinvest in new images 
from the sale of existing inventory.  FEHC invested approximately 
$700,000 in Image in an effort to generate sales through 
introduction of new images to customers.  Image was unable to 
generate enough sales or to liquidate its inventory to generate 
working capital to support continued operations.  In November, 1995 
it was determined that additional working capital would not be 
advanced to Image and that the Company would terminate operations 
and seek a buyer for Image.

On April 24, 1996 the Company and Harvey Rosenberg, a former officer 
and director of the Company, entered into a Purchase Agreement for 
the sale of Image.  Mr. Rosenberg purchased the Company's 1,986,376 
shares of Image for $1,000 resulting in a gain of approximately 
$414,000.  At the time of the disposition of Image, Image had 
liabilities in excess of assets.

The results of operations of Image for the year ended December 
31,1996 are disclosed in the accompanying consolidated  statements of 
operations as discontinued operations.

Indian Licensing

In February 1995, the Company signed a series of agreements giving 
it certain licensing and merchandising rights for the Indian Motor 
Company, subject to the approval of the Bankruptcy Court.  These 
agreements were never approved by the Bankruptcy Court.

In January, 1996 A.B. Goldberg, Harvey Rosenberg, a former director 
and several other unrelated parties were named as defendants in a 
law suit filed by Sterling Consulting Corporation, Receiver for 
Indian Motorcycle Manufacturing, Inc.  The Company filed a counter 
claim against the Receiver  in July, 1996.  In September 1996, the 
Company and the Receiver commenced settlement negotiations whereby 
all parties would resolve their dispute. 

In February, 1997 the Company and the Receiver agreed to the terms 
of a settlement. The proposed Settlement Agreement called for the 
Company to relinquish all rights or claims to the Indian Motorcycle 
Trademark or the use of the Trademark and any licensing rights and 
payment of $114,000.  All rights acquired by the Company from Scott 
Kajiya and Jamie Ruiz for the use of the Indian Motorcycle Trademark 
in Japan are also assigned to the Receiver.

The transactions relating to the use of the Indian Motorcycle 
Trademark in Japan have been rescinded in the accompanying financial 
statements effective from the date the transaction was entered into 
as if the transactions did not occur.

Letters of Intent

In June, 1998 FEHC signed a non-binding letter of intent with 
Intelek, LLC ("Intelek") to form a joint venture with Intelek for 
the purpose of developing and promoting entertainment sites on the 
internet.

FEHC will invest in and receive 50% of the revenues from new sources 
of internet traffic from multiple adult entertainment sites 
presently being operated by Intelek.  FEHC would invest $250,000 and 
issue 250,000 shares of its restricted common stock to Intelek, Inc.  
FEHC would receive a preferential payment of the first $250,000 from 
the new sources of revenue thereafter, FEHC would receive 50% of all 
revenues received from new sources of internet traffic developed.  
Upon receipt of $250,000 FEHC would be obligated to issue an 
additional 250,000 shares of restricted stock.

Consummation of this agreement is subject to a number of conditions 
including the negotiation of a definitive agreement, completion of 
due diligence, approval of the transaction by the Board of Directors 
of both companies and approval of any necessary governmental 
authorities.  Due to the contingencies involved, FEHC is unable to 
predict if or when the transaction will be consummated.

In July 1998 FEHC signed a non-binding letter of intent with 
SportsNet, Inc. (SNI) to operate an internet gaming site from the 
sovereign nation of the Commonwealth of Dominica pursuant to an 
International Gaming License issued December 20, 1997, to a 
subsidiary of the Company.

On September 15, 1998, the Company entered into a definitive 
agreement with SportsNet, Inc. (SNI)  The effective date of the 
Agreement will be ten days after the following two events have 
occurred; (i) SNI has completed a financing of not less than 
$1,000,000 and (ii) the Company has entered into a contract with a 
credit card processor for participants in the Games satisfactory to 
both the Company and SNI.  The Agreement, if and when it becomes 
effective, would continue in effect as long as the Company has a 
valid internet gaming license issued by the Commonwealth  of 
Dominica or would terminate upon revocation of such license by the 
Commonwealth of Dominica.

SNI will at its sole cost and expense provide to FEHC and install 
all hardware, system software, graphical user interfaces, will 
license or cause SNI subcontractors to license all firewall and 
encryption capability necessary to assure integrity of all data 
transmitted by and among FEHC, SNI and participants.  SNI will also 
license to FEHC, in object code format on a non-exclusive basis, 
that computer software incorporating a certified random number 
generator, game logic and reporting package necessary for FEHC to 
offer internet lottery and casino games of blackjack, video poker 
and slots.  SNI will also maintain and monitor a backup site in the 
event the primary gaming site fails.  SNI will also undertake to 
develop new games including, but not limited to, roulette, baccarat, 
paigow and craps.  

The Company at its sole cost and expense will be responsible for 
providing physical facilities, communications installation, lines 
and ,maintenance necessary to accommodate and interface with 
computer hardware located in Dominica.  In addition, the Company 
must provide adequate insurance coverage for the equipment owned by 
the Company and SNI.  The Internet Gaming License issued by the 
Commonwealth of Dominica requires the Company to hire five (5) 
people at the prevailing wage for the term of the license and pay 5% 
of gross revenues derived from the internet gaming revenue but not 
less than $25,000 per year.

FEHC will pay 50% of the Gross Operating Margin to SNI.

SNI will ensure by technical means and means relating to the 
acceptance of wagers, eliminate access to the site by participants 
located in the United States and any other jurisdiction which 
notifies FEHC that providing such access to the games to 
participants within such jurisdiction violates that jurisdiction 
laws governing gaming.


Competition

Radio

100.7, "The Fox" competes with seven other signals available in the 
area.  Two of these radio signals originate from Gillette, Wyoming.  
The Company presently enjoys the largest share of the market, 
estimated to be 44 percent.

   Live Entertainment

Competition is intense in the comedy and music night club 
entertainment industries.  On a national level, the Company competes 
for entertainers with companies that are better capitalized, highly 
visible and have longer operating histories and larger staffs in 
their respective locations.  None of the national comedy clubs have 
locations in Denver, Colorado.  Comedy Works Larimer Square has been 
in business in Denver, Colorado for 16 years and the Company 
believes it to be the highest revenue-producing comedy club in the 
area.  The Company believes that Comedy Works Larimer Square 
provides higher-quality acts than its local competitors, reflected 
in the fact that it charges approximately twice the admission price 
of its local competitors.  The two main competitors of Comedy Works 
Larimer Square are both individually-owned and located in shopping 
centers in the suburbs, while Comedy Works is located in the 
downtown Denver area.  

Licenses

The Federal Communications Commission (FCC) issues radio 
broadcasters a license to operate within their assigned frequency 
for seven years.  These licenses, upon application, are renewable 
for additional seven year periods.  The FCC issued KGWY its original 
license on October 1, 1983, to operate at a frequency of 100.7 MHz, 
24 hours a day, at 100,000 watts of effective radiated power.  It 
was subsequently reissued in October of 1990 and 1997.  During the 
renewal process the public has an opportunity to express its opinion 
of how well the particular station is servicing its broadcast area.  
Extreme public negativity during this period can hold up the 
reissuance process.  In addition, frequent violations of FCC rules 
and regulations can be cause for the denial of the station's license 
renewal.

The FCC allots a certain number of frequencies for each broadcast 
area, based upon community need, population factors and the 
determination of the economic viability of another station in the 
designated region.  Currently there are no other licenses available 
in the Gillette area.  It is possible  to request that the FCC 
reconsider opening up further frequencies through its rule making 
body, but this can be a time consuming process.  All sales of 
stations and subsequent transfers of licenses must be approved by 
the FCC.

In December, 1997 the Commonwealth of Dominica issued an internet 
gaming license to Global Transaction Services, Ltd., a wholly owned 
subsidiary of Global Internet, which allows the Company to establish 
and operate a computer based gaming business operating exclusively 
as an offshore business.  The license is for a period of five years 
and operations must commence within one year and continue without 
significant interruption throughout its term.

Seasonality

Radio

Although revenues are spread over the entire calendar year, the 
first quarter generally reflects the lowest and the fourth quarter 
generally reflects the highest revenues for each year.  The increase 
in retail advertising each fall in preparation for the holiday 
season, combined with political advertising, tends to increase 
fourth quarter revenues.  

Live Entertainment

The Company has found that its highest-revenue months are from July 
15 to October 15 of each year.  From approximately May 15 to July 15 
of each year, business is typically down 30 percent below average, 
primarily because customers prefer outdoor activities at that time 
of year.  During the holiday season, management has found a slight 
increase due to once-a-year customers, on vacation or hosting 
visiting friends or relatives.  

Employees

First Entertainment Holding Corp 

Currently, FEHC, the Holding Company, employs one executive and one 
administrative person.  The Holding Company contracts the 
accounting, management information systems and administrative 
function to a company owned by the former president and to other 
independent consultants.

Radio

The Company employs approximately five full-time employees and eight 
part-time employees.  Of the full-time employees, they are engaged 
mainly in the administrative radio operations and sales.  The part-
time employees are engaged in the on-air activities as on-air 
personalities.  

Live Entertainment

This division has three full-time employees and approximately 20 
part-time employees.  Full-time employees are management staff and 
part-time employees are waitresses, bartenders, and door personnel.  

Retail

This division had one full-time executive.

Item 2.  Description of Property

First Entertainment Holding Corp. 

The Company's executive offices are located at 7887 E. Bellview, 
Suite 1114, Englewood, CO 80111 and are leased under the terms of a 
12-month lease, which terminates in September 1999.  Monthly rental 
is approximately $1,100.  In August, 1998 the Company subleased its 
prior executive office space in an effort to further reduce its 
operating overhead.  The Company has not been relieved of its 
obligation as the primary lessee under its lease as a result of the 
sub-lease. 

Radio

The Company has facilities in Gillette, Wyoming which house the 
radio station, 100.7, The Fox.  In April, 1996  the Company 
purchased the land and building which houses the radio station for 
$300,000 and the land under which the FM tower sits for $125,000, by 
issuing preferred stock valued at $275,000 and a mortgage for 
$150,000.

Live Entertainment

Comedy Works Larimer Square leases its premises under the terms of a 
new 10 year lease, which expires January 31, 2008.  

Lease payments in the first year of the lease term, January 1, 1998 
to December 31, 1998, shall be the total of (i) 8% of gross sales of 
alcoholic beverages, (ii) 6% of gross sales of food related products 
and (iii) 4% of gross sales relating to door admission.

Lease payments for the years two through ten January 1, 1999 to 
January 31, 2008 shall be based on percentage rent as computed above 
but shall not be less than 75% of the average percentage rent paid 
during the three year period January 1, 1996 to December 31, 1998.  
Percentage rent in 1997 was approximately $7,000 a month.

Item 3. Legal Proceedings

First Entertainment

FEHC knows of no litigation pending, threatened, or contemplated, or 
unsatisfied judgments against it, or any proceedings of which FEHC 
or any of its subsidiaries is a party, except as specified below.  
FEHC knows of no legal actions pending or threatened, or judgment 
entered against any of its officers or directors or any of its 
subsidiaries in their capacities as such, except as specified below.  

In January 1996, the Company, AB Goldberg, Harvey Rosenberg and 
several other related and unrelated third parties were named as 
defendants in a lawsuit filed by Sterling Consulting Corporation as 
Receiver for Indian Motorcycle Manufacturing, Inc.("IMMI")  The 
Complaint alleges interference by defendants in the business of 
IMMI, conflicts of interest of AB Goldberg, breach of fiduciary 
duty, unjust enrichment, and bankruptcy fraud.

In July 1996, The Company filed suit against the Receiver alleging 
intentional interference of contracted relationships and breach of 
licensing agreements.

In February 1997, the Company agreed to terms of a Settlement 
Agreement with the Receiver whereby the Company would relinquish all 
rights to the Indian Motorcycle Trademark and paid the Receiver 
approximately $114,000. (see Item 1, Other Business Developments)

In March 1997, the Company commenced legal proceedings against Image 
Marketing Group, Inc. and Harvey Rosenberg, Burt Katz (a director of 
the Company) and Michael Katz, individually, for collection of 
approximately $700,000 in advances to Image Marketing.  Image 
Marketing Group, Inc was purchased by the Company from Burt Katz, 
Michael Katz and Harvey Rosenberg in September 1994.  From September 
1994 to November 1995 the Company advanced Image approximately 
$700,000.  In November, 1995, the Company determined to discontinue 
the operations of Image due to substantial losses and demanded 
repayment of the advances to Image.  Image was unable to repay the 
advances; therefore, the Company commenced legal proceedings against 
Image and its former shareholders.  In July 1997, a settlement was 
reached with Image Marketing Group, Harvey Rosenberg, Burt Katz and 
Michael Kat whereby 144,410 shares of FEHC common stock held by the 
defendants were returned to FEHC.  The shares returned were 
cancelled and returned to treasury.

In 1997,the Company commenced legal proceedings against HK Retail 
Concepts for breech of contract.  The claims are for damages  of 
approximately $50,000.  The Suit was filed in Denver District County 
Court in May, 1997 and is awaiting  trial in January 1999.

In May 1997, David Spolter and Faige Spolter ("Spolter") filed a 
lawsuit against FEHC in the Superior Court of the State of 
California.  The plaintiffs alleged various federal and state 
securities violations and sought recovery of their $75,000 
investment plus damages.  On July 1, 1998 Spolter and FEHC entered 
into a settlement agreement whereby FEHC agreed to pay Spolter 
$150,000,  $25,000 was paid upon execution of the Settlement 
Agreement and the remaining $125,000 shall be payable in monthly 
installments of $5,000 a month until July 15, 1999 at which time all 
unpaid principal and interest shall become due and payable.  The 
note bears interest of 10% per annum.  FEHC agreed to pledge all of 
its stock of its wholly owned subsidiary, Quality Communications, 
Inc. a collateral on the note and to provide a security interest in 
all assets of Quality Communications, Inc.  In the event of default, 
the amount due shall be $180,000 plus interest at 10% from June 1, 
1998, less amounts previously paid.  In addition, any principal and 
interest amounts shall be due immediately and payable upon sale of 
the radio station in Gillette, Wyoming.

In 1997, Sharon K. Doud filed a civil action against FEHC, AB 
Goldberg and Quality Communications for breach of contract, fraud 
and misrepresentation for failure to convert Class C Convertible 
Preferred Stock into 91,240 shares of common stock.  In April, 1998 
a settlement agreement was reached between FEHC and Sharon Doud 
whereby FEHC was required to pay $6,150 in legal fees, issue a 
promissory note in the principal sum of $125,000 bearing interest at 
9.5% per annum due March 31, 1999 and the Class C Convertible 
Preferred Shares were cancelled.
In June 1996, Frank P. D'Alessio, a former director of the Company, 
commenced an action against A.B. Goldberg, president and director of 
the Company, Nannette Goldberg, wife of A.B. Goldberg, Sara 
Goldberg, mother of A.B. Goldberg, Cohig & Associates, Neidiger 
Tucker Brunner, Inc, Hanifin, Inhoff, Inc., Southwest Securities, 
Inc., Paul Davis and Mike Zenhari in the United States District 
Court for the District of Colorado.
 
The suit alleges that the plaintiff (Mr. D'Alessio) was defrauded by 
the defendants pursuant to security transactions involving shares of 
common stock purchased by plaintiff in Video Communications and 
Radio, Inc. (now First Entertainment Holding Corp.) The defendants 
have strenuously denied any violations of any state or federal 
statutory or common law.

On October 1, 1996 the plaintiff and the defendants entered into a 
Settlement Agreement and Mutual Release.  The Settlement Agreement 
required A.B. Goldberg to deliver to the plaintiff 150,000 shares of 
common stock of First Entertainment Holding Corp. by August 1, 1997, 
and such shares will be registered in a Form S-3 filed with the 
Securities and Exchange Commission.  In addition, Mr. Goldberg was 
to deliver to plaintiff a certified or cashier's check in the amount 
of $20,000 by May 5, 1997.

On November 19, 1996 50,000 shares of common stock of FEHC were 
transferred to Mr. D'Alessio from Mr. Michael Payne, a shareholder 
of FEHC.  In July 1996 Mr. Payne had been issued 554,000 shares of 
common stock of FEHC in exchange for his shares of common stock of 
Power Media (see Note C to the Consolidated Financial Statements).  
In July 1997 100,000 shares of common stock of FEHC were issued to 
NMG, LLC, an entity owned by the wife of the President of the 
Company, in exchange for 100,000 shares of ASOTV (see Note C to the 
Consolidated Financial Statements)  On July 29, 1997 the 100,000 
shares of common stock acquired by NMG, LLC were transferred to Mr. 
D'Alessio.  The 150,000 shares of common stock received by Mr. 
D'Alessio were registered in a Form S-3 filed with the Securities 
and Exchange Commission in 1997.

The value of the common stock transferred to Mr. D'Alessio, $76,500, 
has been classified as officer compensation to A.B. Goldberg in the 
accompanying consolidated statements of operations.

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

On December 5, 1997 a special meeting of the shareholders of FEHC 
was held and the shareholders were asked to vote on six issues (i) 
the election of AB Goldberg Dr. Nick Catalano and Dr. Theodore 
Jacobs as board of directors, (ii) the ratification of the 
acquisition of Global Internet, (iii) amending the Company's 
articles of incorporation to increase the number of authorized 
shares from 6,250,000 to 50,000,000 shares, (iv) change the state of 
incorporation from Colorado to Nevada, (v) a change in name of the 
Company to First Entertainment Holding Corp and (vi) ratification of 
BDO Seidman LLP as the Company's independent public accountants.  On 
April 6, 1998, the Company was informed by its independent auditors, 
BDO Seidman, LLP of BDO Seidman, LLP's resignation, effective as of 
that date (See Item 8. Changes in and Disagreements with Accountants 
on Accounting on Accounting and Financial Disclosure).  

Mr. Goldberg, Mr. Catalano and Mr. Jacobs were elected as directors 
of the Company by a vote of 4,339,283 in favor and 2,406 against, 
3,907 abstaining. 

The ratification and approval of the acquisition of Global Internet 
was approved by a vote of 3,400,423 in favor, 6,561 against and 407 
abstaining. 

To amend the Articles of Incorporation increasing the number of 
authorized shares from 6,250,000 to 50,000,000, the motion was 
approved by a vote of 4,261,131 in favor, 79,498 against and 4,967 
abstaining.

To amend the Company's Articles of Incorporation to change of the 
Company's domicile to Nevada and its name to First Entertainment 
Holding Corp the motion was approved by a vote of 3,251,218 in 
favor, 62,185 against and 5,246 abstaining.

The ratification of BDO Seidman, LLP as the Company's  independent 
accountant was approved 4,337,461 in favor, 4,819 against and 3,316 
abstaining.  On April 6, 1998, the Company was informed by its 
independent auditors, BDO Seidman, LLP of BDO Seidman, LLP's 
resignation, effective as of that date (See item 8. Changes in and 
Disagreements with Accountants on Accounting and Financial 
Disclosure).  

Item 5. Market for the Company's Common Equity and Related 
Stockholder Matters

The Company's common stock was traded on NASDAQ in the over-the-
counter market and since October 1988, had been included in NASDAQ.  
On February 5, 1998 the Company was notified that as of the close of 
business that day, the Company's stock would be delisted from NASDAQ 
for failure to meet the minimum bid requirement.  Effective February 
6, 1998 the Company's stock is trading on the OTC Bulletin Board.  
The following table sets forth the high and low bid quotation for 
the Company's common stock for each quarterly period in 1997 and 
1996.  As of September 30, 1998, there were approximately 1,150 
shareholders of record of the Company's common stock.  Holders of 
common stock are entitled to receive such dividends as they may be 
declared by the Company's Board of Directors.  No dividends are 
anticipated to be paid in the foreseeable future.  
<TABLE>
                                                   Bid Price           
                                                 High           Low     
<S>                                              <C>          <C>
 1997
  First Quarter                                   $ 2.22      $ .75
  Second Quarter                                    1.47        .84
  Third Quarter                                     1.25        .72
  Fourth Quarter                                     .91        .66

 1996
  First Quarter                                    $ .66      $ .44
  Second Quarter                                    1.94        .50
  Third Quarter                                     1.25        .63
  Fourth Quarter                                    1.00        .50
</TABLE>

Item 6. Management Discussion and Analysis or Plan of Operation

Fiscal 1997 as Compared to Fiscal 1996

The Company had a net loss from continuing operations of 
approximately $2.9 million in 1997 and $1.6 million in 1996.

The loss from discontinued operations of $731,000 in 1997 includes 
only the operations of ASOTV and includes an estimate for shut down 
costs of approximately $51,000.

The loss from discontinued operations of $56,000 in 1996 represents 
the loss from Image Marketing of approximately $29,000 and the loss 
from ASOTV of approximately $27,000.  The 1996 financial statements 
were restated to reflect the discontinued operations of ASOTV which 
were determined to be discontinued  in January 1998.

The gain on the sale of discontinued operations in 1996 of $413,704 
is the result of the sale of Image Marketing that at the date of 
disposition had liabilities in excess of assets.

Overall revenues increased from $2.1 million in 1996 to $2.3 million 
in 1997.  Live entertainment revenues increased from $1.26 million 
in 1996 to $1.39 million in 1997.  The increase is due in part to a 
strong economy which is providing more discretionary income and to 
increased attendance.  The Comedy Club has been successful in 
bringing in highly recognized headliners, some of which performed 
special engagements during the week when attendance is less than on 
weekends.  As a result of increased attendance, food sales and 
liquor sales have also increased.  Overall, the industry has seen a 
decline in attendance at comedy clubs nationwide, although the 
Denver comedy club has been able to retain and even increase 
attendance.  With the increase in live entertainment sales in 1997, 
cost of sales has also increased from $1.1 million in 1996 to $1.2 
million in 1997.  The largest component of cost of sales, live 
entertainment, is labor, including entertainers salaries which 
increased from $547,000 in 1996 to $655,472 in 1997.  Of the 
$108,000 increase in labor costs in 1997, $83,500 was attributable 
to entertainers. 

Radio sales have increased from $713,000 in 1996 to $772,000 in 1997 
primarily due to an increase in ad sales of $21,500, an increase in 
concert income of $23,000 and an increase in trade show income of 
$10,000.  The radio station in Gillette, Wyoming is a country music 
format and began promoting concerts in 1995 for up and coming 
country music performers.  Revenue from concert income was $33,000 
in 1996 and $56,000 in 1997.  The radio station still has the 
largest audience share in Gillette, Wyoming.  Cost of sales-radio 
has increased by $14,000 from 1996 to 1997 primarily due to the cost 
of the concerts.  The single largest component of cost of sales, 
radio, is labor which was $296,000 in 1996 and $280,000 in 1997.  
The radio station has been successful in increasing radio revenues 
without adding additional people.  The radio station is continuing 
in its efforts to manage its costs and as such has substantially 
reduced its operating overhead.

Video sales in 1996 is the result of the sale of foreign 
distribution rights for $50,000 and collection of foreign royalties 
of $53,000.  Video sales in 1997 represents the sale of video 
distribution rights in the U.S. for $50,000.  The Company is no 
longer active in the video distribution market for its destination 
video series.

Other revenue increased from $46,000 in 1996 to $112,000 in 1997.  
Other revenue consists primarily of T-shirt, coupon books, cigarette 
sales and booking agent fees.  Other revenues in 1997 includes 
$62,500 from a third party paid to the Company to buy-out its office 
space.  The unrelated third party needed additional office space and 
was willing to pay the Company an incentive to move including the 
estimated costs of moving.  In September 1997, the Company moved to 
new office space.  Excluding the $62,500 from other revenue, 1997 
other income was $49,800 as compared to $46,000 in 1996.

Impairment write downs in 1997 represent the write down in a note 
receivable of approximately $902,000 to its estimated net realizable 
value of $81,340 and a write down of investment in Global of 
$557,899 to its estimated net realizable value of $0.

Depreciation and amortization decreased from $326,500 in 1996 to 
$141,200 in 1997.  The decrease of $ 185,300 is primarily due to the 
fact that the master tape library is fully depreciated at December 
31, 1996.  The master tape library represented approximately 50% of 
property and equipment.

Management and administrative fees, affiliate, decreased from 
$408,000 in 1996 to $240,000 in 1997.  The underlying agreement, 
which provides for services valued at $20,000 per month was in 
effect for 1997 and 1996.  In addition, the 1996 fees include a 
bonus paid in common stock of the Company of $168,000.

Selling, general and administrative expenses (SG&A) increased from 
$1.33 million in 1996 to $1.53 million in 1997, an increase of 
approximately $206,000.  The Company made a concerted effort to 
reduce SG&A during 1997 and 1996 which resulted in significant 
savings.  There were certain transaction which had an adverse effect 
on SG&A for 1997 and 1996.  Included in SG&A in 1997 are expenses 
resulting from litigation settlements totaling $150,000 and 
compensation of $434,000 for options and warrants issued to non-
employees accounted for under FAS 123.  Included in SG&A in 1996 is 
the accrual for stock bonus awards issued in 1997 for 1996 services 
of approximately $89,600.  In addition, the Company incurred 
substantial legal fees in 1996 in connection with the Indian 
Motorcycle litigation and settlement negotiations.  The settlement 
resulted in the Company recording settlement costs of $114,200 in 
1996.  Legal fees were approximately $170,000 in 1997 compared to 
$195,000 during 1996.  Compensation and consulting fees were 
approximately $568,000 for 1997 compared to $467,000 for 1996. 

Notes payable and long term debt was $1,284,500 in 1997 and 
$1,061,000 in 1996.  The average outstanding balance of long term 
debt was $1,173,000 in 1997 as compared to $1,019,000 in 1996.  The 
decline in interest expense between 1997 and 1996 is primarily due 
to overall the weighted average balance in notes payable in 1997 was 
less then 1996.  At December 31, 1997 the Company accrued $275,000 
as the result of a litigation settlement subsequent to year-end.  
These amounts did not accrue interest during 1997.

Liquidity and Capital Resources

The accompanying consolidated financial statements have been prepared 
assuming that the Company will continue as a going concern.  The 
opinions of the Company's independent auditors delivered in 
connection with the Company's financial Statements for fiscal 1997 
and 1996 also contain an explanatory paragraph relative to the going 
concern uncertainty. As discussed in Notes A and E to the 
consolidated financial statements, the Company has suffered recurring 
losses from operations, has a working capital deficiency of 
approximately $1.4 million, has negative net worth of approximately 
$445,000, and is in default on nearly $386,000 of its notes payable 
as of December 31, 1997.  In February, 1998 the Company was delisted 
from NASDAQ for failure to meet the minimum bid price.  The delisting 
from NASDAQ has impaired the Company's ability to raise equity 
financing.  These conditions raise material doubt about the Company's 
ability to continue as a going concern. The consolidated financial 
statements do not include any adjustments that might result from the 
outcome of these uncertainties.

Management's plans with regard to the Company's ability to continue 
as a going concern include continued raising of equity financing, 
restructuring of its debt obligations, evaluating mergers and 
acquisitions to improve market share or operational synergy's and 
improving efficiency of operations. For several years, losses from 
operations have resulted in significant cash deficiencies and have 
hindered the Company's ability to properly fund certain business 
segments, to make them profitable or to expand current business 
segments. The Company must generate additional revenues that must 
come from sources other than the existing business segments.  The 
existing business segments will not generate sufficient operating 
income to cover SG&A and other overhead costs.  Therefore new 
business opportunities will be needed for the Company to continue in 
the long term.  The Company is always evaluating additional business 
opportunities but is limited due to its lack of working capital. 

The Company has been successful in 1997 and in 1996 in financing 
operations through issuance of common stock in settlement of accounts 
payable and in exchange for services.  This form of payment has 
reduced the cash requirements of the Company.  In 1997, the Company 
issued 751,600 shares of common stock for services valued at $676,215 
or an average of $.90 per share.  In 1996, the Company issued 532,700 
shares of common stock for services valued at $534,000 or $1.00 per 
share.  In 1997, the Company issued 440,000 shares of its common 
stock in settlement of accrued bonus's of $270,800.  No shares were 
issued in 1996 in settlement of accounts payable.  Of the total costs 
and expenses of $3.7 million in 1996 and $4.7 million in 1997, 
$548,000 was paid by stock in 1996 and $676,000 was paid by stock in 
1997.  Stock issued for services as a percentage of revenues was 20% 
in 1996 and 25% in 1997.  Capital expenditures needed by existing 
business segments to increase sales and profitability are minimal.

If the Company is successful in negotiating a definitive agreement 
with Intelek, LLC. related to the pending letter of intent, between 
$250,000 and $500,000 in initial financing will be needed to complete 
the Company's obligation under the agreement.  The Definitive 
Agreement with SportsNet, Inc. requires the Company to provide all 
physical facilities and communications installation in the 
Commonwealth of Dominica necessary to accommodate and interface with 
the required computer hardware to be supplied by SportsNet, Inc.  The 
Company has not yet determined the ultimate long term costs required 
to complete its obligation under the Agreement with SportsNet, Inc.
 
Through September 30, 1998 the Company was successful in raising 
approximately $213,000, net of offering costs in equity financing in 
a private offering, but there can be no assurance that the Company 
would be successful in raising the additional equity financing needed 
to finance the acquisition contemplated under the letter of intent or 
the definitive agreement.  As of September 30, 1998 the Company has 
cash and cash equivalents of $125,000 which it believes is sufficient 
to meet its existing obligations through December 31, 1998.

A valuation allowance offsetting the Company's total net deferred tax 
asset has been established to reflect management's evaluation that it 
is more likely than not that all of the deferred tax assets will not 
be realized.

"YEAR 2000 PROBLEM".  The Company is aware of the issues associated 
with the programming code in existing computer systems as the 
millenium (Year 2000) approaches.  The "Year 2000" problem is 
pervasive and complex as virtually every computer operation will be 
affected in some way by the rollover of the two digit year value to 
00.  The issue is whether computer systems will properly recognize 
date sensitive information when the year changes to 2000.  Systems 
that do not properly recognize such information could generate 
erroneous data or cause a system to fail.  The Company has determined 
to purchase new accounting software which is Year 2000 compatible.  
The new software will be in place by December 31, 1998 and will cost 
less than $10,000.

RECENT ACCOUNTING PRONOUNCEMENTS.  The Company  adopted  FAS No. 128, 
"Earnings per Share" and FAS No. 129, "Disclosure of Information 
About an Entity's Capital Structure"  effective December 31, 1997.  
FAS No. 128 provides a different methods of calculating earnings per 
share than that currently used in accordance with Accounting 
Principles Board Opinion 15 "Earnings per Share." FAS No. 128 
provides calculation of "basic" and "diluted" earnings per share.  
Basic earnings per share includes no dilution and is computed by 
dividing income available to common shareholders by the weighted 
average number of common shares outstanding for the period.  Diluted 
Earnings per share reflects the potential dilution of securities that 
could share in the earnings of an entity, similar to fully diluted 
earnings per share.  FAS No. 129 establishes standards for disclosing 
information about an entity's capital structure.  The implementation 
of FAS No. 128 and FAS No. 129 has not had a material effect on the 
consolidated financial statements of the Company.

In June 1997, FASB issued Statement of Financial Accounting Standard 
No. 130, entitled "Reporting Comprehensive Income" ("SFAS 130") 
and Statement of Financial Accounting Standard No. 131, entitled 
"Disclosure about Segments of Enterprise and Related Information" 
(SFAS 131).  SFAS 130 establishes standards for reporting and display 
of comprehensive income, its components and accumulated balances.  
Comprehensive Income is defined to include certain changes in equity 
but not those resulting from investments by owners and distributions 
to owners.  Among other disclosures, SFAS 130 requires that all items 
that are requited to be recognized under current accounting standards 
as components of comprehensive income be reported in a financial 
statement displayed with the same prominence as other financial 
statements.  SFAS 131 supersedes Statement of Financial Accounting 
Standard No. 14, entitled "Financial Reporting for Segments of a 
Business Enterprise."  SFAS 131 revises standards of the way the 
public companies report information about operating segments in 
annual financial statements and requires reporting of selected 
information about operating segments in interim financial statements 
issued to the public.  It also establishes standards for disclosures 
regarding products and services, geographic areas and major 
customers.  SFAS 131 defines operating segments as components of a 
company about which separate financial information is available that 
is evaluated regularly by the chief operating decision maker in 
deciding how to allocate resources and in assessing segment 
performance.

SFAS 130 and SFAS 131 are effective for financial statements for 
periods beginning after December 15, 1997 and require comparative 
information for earlier years to be restated.  Because of the recent 
issuance of these standards, management has been unable to fully 
evaluate the impact of SFAS 130, if any, on future financial 
statement disclosures. The Company adopted SFAS 131 and restated all 
prior periods.  The adoption of SFAS 131 did not have a material 
effect on its results of operations for 1997 and 1996.

In February 1998, the FASB issued FAS No. 132 "Employers' Disclosure 
about Pensions and other Postretirement Benefits' which standardizes 
the disclosure requirements for pensions and other postretirement 
benefits and requires additional information on changes in the 
benefit obligations and fair values of plan assets that will 
facilitate financial analysis.  FAS No. 132 is effective for years 
beginning after December 15, 1997 and requires comparative 
information for earlier years to be restated, unless such information 
in not readily available.  Management believes the adoption of this 
statement will have no impact on the Company's financial statements. 

The FASB has recently issued Statement of Financial Accounting 
Standards No. 133, "Accounting for Derivative Instruments and 
Hedging Activities" ("SFAS No. 133").  SFAS No. 133 established 
standards for recognizing all derivative instruments including those 
for hedging activities as either assets or liabilities in the 
statement of financial position and measuring those instruments at 
fair value.  This Statement is effective for fiscal years beginning 
after June 30, 1999.  The Company has not yet determined the effect 
of SFAS No. 133 on its financial statement.


Item 7.	Financial Statements 

FIRST ENTERTAINMENT HOLDING CORP. AND SUBSIDIARIES
(Formerly First Entertainment, Inc. and Subsidiaries) 
Index to Consolidated Financial Statements



Reports of Independent Certified Public Accountants

Consolidated Balance Sheets

Consolidated Statements of Operations

Consolidated Statements of Stockholders' Equity (Deficit)

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements


Report of Independent Certified Public Accountants

Board of Directors and Stockholders
First Entertainment Holding Corp
(Formerly First Entertainment, Inc. and Subsidiaries) 
Denver, Colorado 


We have audited the accompanying consolidated balance sheet of First 
Entertainment Holding Corp. and Subsidiaries as of December 31, 1997 
and the related consolidated statements of operations, stockholders' 
equity (deficit) and cash flows for the year then ended.  These 
consolidated financial statements are the responsibility of the 
Company's management.  Our responsibility is to express an opinion on 
these consolidated financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing 
standards.  Those standards require that we plan and perform the audit 
to obtain reasonable assurance about whether the consolidated financial 
statements are free of material misstatement.  An audit includes 
examining, on a test basis, evidence supporting the amounts and 
disclosures in the consolidated financial statements.  An audit also 
includes assessing the accounting principles used and significant 
estimates made by management, as well as evaluating the overall 
consolidated financial statement presentation.  We believe that our 
audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above 
present fairly, in all material respects, the financial position of 
First Entertainment Holding Corp. and Subsidiaries as of December 31, 
1997 and the results of their operations and their cash flows for the 
year then ended, in conformity with generally accepted accounting 
principles.

The accompanying consolidated financial statements have been prepared 
assuming that the Company will continue as a going concern.  As 
discussed in Notes A and E to the consolidated financial statements, 
the Company has suffered recurring losses from operations, has a 
working capital deficiency of approximately $1.4 million and is in 
default on a substantial portion of its debt.  These conditions raise 
substantial doubt about the Company's ability to continue as a going 
concern.  Management's plans in regards to these matters are discussed 
in Note A.  The consolidated financial statements do not include any 
adjustments that might result from the outcome of these uncertainties.



Gordon, Hughes & Banks, LLP

November 1, 1998
Denver, Colorado



Report of Independent Certified Public Accountants

Board of Directors and Stockholders
First Entertainment Holding Corp
(Formerly First Entertainment, Inc. and Subsidiaries) 
Denver, Colorado 


We have audited the accompanying consolidated balance sheet of First 
Entertainment Holding Corp. and Subsidiaries as of December 31, 1996 
and the related consolidated statements of operations, stockholders' 
equity (deficit) and cash flows for the year then ended.  These 
consolidated financial statements are the responsibility of the 
Company's management.  Our responsibility is to express an opinion on 
these consolidated financial statements based on our audit.

We conducted our audit in accordance with generally accepted auditing 
standards.  Those standards require that we plan and perform the audit 
to obtain reasonable assurance about whether the consolidated financial 
statements are free of material misstatement.  An audit includes 
examining, on a test basis, evidence supporting the amounts and 
disclosures in the consolidated financial statements.  An audit also 
includes assessing the accounting principles used and significant 
estimates made by management, as well as evaluating the overall 
consolidated financial statement presentation.  We believe that our 
audit provides a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above 
present fairly, in all material respects, the financial position of 
First Entertainment Holding Corp. and Subsidiaries as of December 31, 
1996 and the results of their operations and their cash flows for the 
year then ended, in conformity with generally accepted accounting 
principles.

The accompanying consolidated financial statements have been prepared 
assuming that the Company will continue as a going concern.  As 
discussed in Notes A and E to the consolidated financial statements, 
the Company has suffered recurring losses from operations, has a 
working capital deficiency, and is in default on a substantial portion 
of its debt.  These conditions raise substantial doubt about the 
Company's ability to continue as a going concern.  Management's plans 
in regards to these matters are discussed in Note A.  The consolidated 
financial statements do not include any adjustments that might result 
from the outcome of these uncertainties.



BDO Seidman, LLP

March 3, 1997
Denver, Colorado


<TABLE>
<CAPTION>
FIRST ENTERTAINMENT HOLDING CORP AND SUBSIDIARIES
(Formerly First Entertainment, Inc. and Subsidiaries) 
Consolidated Balance Sheets
</CAPTION>

December 31, 1997 and 1996


                                            1997              1996
<S>                                       <C>              <C>
ASSETS

CURRENT
 Cash and cash equivalents                   $ 18,049        $49,128
 Trade accounts receivable, net of
 allowance for doubtful
  accounts of $3,885 and $7,483,
   respectively                                97,271         86,602
 Note receivable, other                        20,335        218,010
 Accounts receivable officer                   25,524
 Stock subscription, receivable                25,000
 Notes receivable, affiliate                                  10,000
 Inventories                                   23,377         23,743
 Other                                         22,127         18,176
 Net assets of discontinued operations                       413,250
----------------------------------------------------------------------
                                              231,683        818,909
----------------------------------------------------------------------
PROPERTY AND EQUIPMENT 
 Master tape library and film costs                        1,600,827
 Equipment and furniture                      760,593        741,053
 Building and leasehold improvements          532,257        528,257
 Land                                         125,000        125,000
---------------------------------------------------------------------
                                            1,417,850      2,995,137
 Less accumulated depreciation
  and amortization                            874,067      2,399,175
---------------------------------------------------------------------
                                              543,783        595,962
---------------------------------------------------------------------
OTHER ASSETS
 License, net of accumulated amortization
  of $482,980 and $420,460, respectively      788,401        	829,921
 License held for sale                                       800,000
 Note receivable                               61,105
 Other                                          3,760 
----------------------------------------------------------------------
                                              853,266      1,629,921 
----------------------------------------------------------------------
TOTAL ASSETS                             $ 1, 628,732    $ 3,044,792
===================================================================

<CAPTION>
"See accompanying reports of independent certified public accountants 
and notes to consolidated financial statements."
</CAPTION>
</TABLE>


<TABLE>
<CAPTION>
FIRST ENTERTAINMENT HOLDING CORP. AND SUBSIDIARIES 
(Formerly First Entertainment, Inc. and Subsidiaries) 
Consolidated Balance Sheets, continued
</CAPTION>

December 31, 1997 and 1996

                                                    1997          1996
<S>                                             <C>          <C>
LIABILITIES AND STOCKHOLDERS'(DEFICIT) EQUITY

CURRENT LIABILITIES
 Accounts payable                                $ 172,575    $ 91,501
 Accrued liabilities                               168,902     166,917
 Accrued interest                                  394,340     324,805
 Accrued bonuses                                               257,600
 Notes payable and current portion
  of long-term debt                                850,376     861,392
 Notes payable, related parties                      3,000
 Net liabilities of discontinued operations         53,051
----------------------------------------------------------------------
                                                 1,642,244   1,702,215
----------------------------------------------------------------------
LONG-TERM DEBT, NET OF CURRENT PORTION             431,120     199,484
----------------------------------------------------------------------
COMMITMENTS AND CONTINGENCIES 

STOCKHOLDERS' (DEFICIT) EQUITY 
 Preferred stock, $.001 par value;
 authorized 5,000,000 shares;
  Class A preferred stock, 1,500,000
    shares authorized, 10,689 shares
     issued and outstanding, liquidation
       value $15,000                                    10          10
  Class B preferred stock, 1,000,000
    shares authorized, 91,147 and 0
     shares issued and outstanding                      91
  Class C preferred stock, 1,000,000
    shares authorized 0 and 125,000 
     shares issued and outstanding                                 125
 Common stock, $.008 par value; 
   authorized 50,000,000 shares;
    6,412,304 and 5,292,238 shares 
     issued and outstanding                          51,299     42,338
 Capital in excess of par value                  14,947,897 	13,460,958
 Accumulated (deficit)                         (15,443,929)(11,829,707)
 Deferred compensation                                         (45,807)
 Treasury stock, at cost, 77,125
  shares of common stock                                      (484,824)
----------------------------------------------------------------------
                                                  (444,632)  1,143,093
----------------------------------------------------------------------
TOTAL LIABILITIES AND STOCKHOLDERS' 
(DEFICIT) EQUITY                               $ 1,628,732 $ 3,044,792
======================================================================


<CAPTION>
"See accompanying reports of independent certified public accountants 
and notes to consolidated financial statements."
</CAPTION>
</TABLE>

<TABLE>
<CAPTION>
FIRST ENTERTAINMENT HOLDING CORP. AND SUBSIDIARIES 
(Formerly First Entertainment, Inc. and Subsidiaries) 
Consolidated Statements of Operations
</CAPTION>

For the Years Ended December 31, 1997 and 1996
                                               1997              1996    
<S>                                      <C>              <C>
REVENUE
 Live entertainment                      $ 1,389,533      $ 1,255,735
 Radio                                       771,992          713,322
 Video                                        50,239          105,618
 Other                                       112,327           46,021
---------------------------------------------------------------------
                                           2,324,091        2,120,696
----------------------------------------------------------------------
COSTS AND EXPENSES
 Cost of sales, live entertainment         1,211,509	        1,078,043
 Cost of sales, radio                        526,215          512,299
 Cost of products sold, video                 13,239            9,483
 Impairment write downs                    1,460,018 
 Depreciation and amortization               141,176	          326,522
 Management and administrative fees,
 affiliate	                                   240,000	          408,000
 Selling, general and administrative       1,532,049	        1,326,256
---------------------------------------------------------------------
                                           5,124,206	        3,660,603
---------------------------------------------------------------------
OPERATING (LOSS) FROM CONTINUING
 OPERATIONS                               (2,800,115)      	(1,539,907)
----------------------------------------------------------------------
OTHER INCOME (EXPENSE)
 Interest expense                            (95,333)        	(102,791)
 Other, net                                    1,206           	22,961
---------------------------------------------------------------------
                                             (94,127)	         (79,830)
---------------------------------------------------------------------
(LOSS) FROM CONTINUING OPERATIONS
BEFORE MINORITY INTEREST                  (2,894,242)	      (1,619,737)

MINORITY INTEREST IN NET (LOSS) OF
 SUBSIDIARY                                   11,473
----------------------------------------------------------------------
(LOSS) FROM CONTINUING OPERATIONS         (2,882,769)	      (1,619,737)
----------------------------------------------------------------------
DISCONTINUED OPERATIONS (Note D)
 (Loss) from discontinued operations,
   including provision for operating 
    losses during phaseout period           (731,453)	         (56,127)
 Gain on sale of discontinued
  operations                                                   413,704
----------------------------------------------------------------------
NET (LOSS)                              $ (3,614,222)     $(1,262,160)
=====================================================================
NET (LOSS) PER COMMON SHARE, CONTINUING
OPERATIONS BASIC AND DILUTED            $       (.48)     $      (.39)
======================================================================
NET INCOME (LOSS) PER COMMON SHARE, 
DISCONTINUED OPERATIONS                 $       (.12)     $       .09
======================================================================
NET (LOSS) PER COMMON SHARE             $       (.60)     $      (.30)
======================================================================
WEIGHTED-AVERAGE NUMBER OF
SHARES OUTSTANDING BASIC AND DILUTED       6,026,319        	4,168,661
=====================================================================
<CAPTION>
"See accompanying reports of independent certified public accountants 
and notes to consolidated financial statements."
</CAPTION>
</TABLE>

<TABLE>
<CAPTION>
FIRST ENTERTAINMENT HOLDING CORP AND SUBSIDIARIES
Consolidated Statements of Stockholders' Equity (Deficit)
For the Years Ended December 31, 1996 and 1995
</CAPTION>

                       Class A           	Class B          Class C    
                 Preferred Stock     	Preferred Stock   	Preferred Stock 
                    Shares   Amount  	Shares   Amount   Shares    Amount 
<S>               <C>        <C>       <C>     <C>      <C>     <C>
BALANCES,
JANUARY 1, 1996   10,689     $     10  231,976 $    232 $     0 $    0
Preferred stock
 issued for:
Acquisition of
  Property                                              275,000    275

Common stock
 issued for:
Consulting
 services
Exercise of
 stock options
Conversion of 
 Class B
  Preferred                           (231,976)   	 (232)
Conversion of
 Class C preferred                                     	(150,000)  (150)
Inventory and
 rights
Business
 combination
Common stock
 options, issued
  for services
Amortization of
 deferred
  compensation
Net loss
----------------------------------------------------------------------
BALANCES,
DECEMBER 31,
 1996             10,689         $10         0       $0 125,000   $125
=======================================================================
</TABLE>

<TABLE>
                      Common Stock      Capital In      Accumulated
                                        Excess Of 
                    Shares    Amount    Par Value      (Deficit)
<S>                 <C>       <C>       <C>             <C>
BALANCES,
JANUARY 1, 1996     2,631,544 $ 21,052  $ 11,227,696    ($10,567,547)
Preferred stock
 issued for:
Acquisition of
  Property                                   274,725

Common stock
 issued for:
Consulting
 Services            532,700     4,262       529,579
Exercise of
 stock options        50,000       400        22,100
Conversion of 
 Class B
  Preferred           57,994       464          (232)
Conversion of
 Class C preferred   150,000     1,200        (1,050)
Inventory and
 Rights            1,100,000     8,800       991,200
Business
 Combination         770,000     6,160       401,940
Common stock
 options, issued
  for services
Amortization of
 deferred
  compensation
Net loss                                                  (1,262,160)
---------------------------------------------------------------------
BALANCES,
DECEMBER 31,
 1996             5,292,238   $ 42,338  $ 13,460,958     (11,829,707)
=======================================================================
</TABLE>
<TABLE>
                         Deferred         Treasury
                         Compensation     Stock        Total
<S>                     <C>               <C>          <C>       
BALANCES,
JANUARY 1, 1996         ($ 263,065)       ($ 484,824)    ($66,446)
Preferred stock
 issued for:
Acquisition of
  Property                                                275,000
Common stock
 issued for:
Consulting 
 Services                                                 533,841
Exercise of
 stock options                                             22,500
Conversion of 
 Class B
  Preferred           
Conversion of
 Class C preferred   
Inventory and
 Rights                                                 1,000,000
Business
 Combination                                              408,100
Common stock
 options, issued
  for services
Amortization of
 deferred
  compensation             217,258                        217,258
Net loss                                               (1,262,160)
---------------------------------------------------------------------
BALANCES,
DECEMBER 31,
 1996                     ($45,807)         ($484,824) $1,143,093
=======================================================================
</TABLE>

<TABLE>
                      Class A           	Class B          Class C    
                 Preferred Stock     	Preferred Stock   	Preferred Stock 
                    Shares   Amount  	Shares   Amount   Shares    Amount 
<S>               <C>        <C>       <C>     <C>      <C>     <C>

Preferred stock
 issued for:
 Cash, net of
  offering costs                        47,067     47

Cancellation of
 treasury stock
Cancellation of
 preferred stock in
  connection with
  litigation 
   settlement                                           (125,000)  (125)

Common stock
 issued for:
Consulting
 services
Exercise of 
 stock options
Accrued bonuses
Accounts payable
Business acquisition                    44,080     44
Common Stock
 options and
  warrants issued
Amortization of deferred 
 compensation
Net loss
----------------------------------------------------------------------
BALANCES,
DECEMBER 31,
 1997             10,689   $  10        91,147    $91          0     $0
=======================================================================
</TABLE>
<TABLE>
                      Common Stock      Capital In      Accumulated
                                        Excess Of 
                    Shares    Amount    Par Value      (Deficit)
<S>                 <C>       <C>       <C>             <C>

Preferred stock
 issued for:
 Cash, net of
  offering costs                         262,703

Cancellation of
 treasury stock    (221,534)  (1,772)   (483,052)
Cancellation of
 preferred stock in
  connection with
  litigation 
   settlement                           (124,875)

Common stock
 issued for:
Consulting
 Services           751,600    6,013     670,202
Exercise of 
 stock options      150,000    1,200      73,800
Accrued bonuses     420,000    3,360     254,240
Accounts payable     20,000      160      13,040
Business
 acquisition                             386,856
Common Stock
 options and
  warrants issued                        434,025
Amortization of
 deferred 
 compensation
Net loss                                                (3,614,222)
----------------------------------------------------------------------
BALANCES,
DECEMBER 31,
 1997             6,412,304  $51,299 $14,947,897      ($15,443,929)
=====================================================================
</TABLE>
<TABLE>
                          Deferred         Treasury
                         Compensation     Stock        Total
<S>                     <C>               <C>          <C>       

Preferred stock
 issued for:
 Cash, net of
  offering costs                                         262,750

Cancellation of
 treasury stock                            484,824
Cancellation of
 preferred stock in
  connection with
  litigation 
   settlement                                           (125,000)

Common stock
 issued for:
Consulting
 Services                                                676,215
Exercise of 
 stock options                                            75,000
Accrued bonuses                                          257,600
Accounts payable                                          13,200
Business
 acquisition                                             386,900
Common Stock
 options and
  warrants issued                                        434,025
Amortization of
 deferred 
 compensation            45,807                           45,807
Net loss                                              (3,614,222)
-----------------------------------------------------------------
BALANCES,
DECEMBER 31,
 1997                  $      0                 0      ($444,632)
=================================================================

<CAPTION>
"See accompanying report of independent certified public accountants 
and notes to consolidated financial statements."
</CAPTION>
</TABLE>
<TABLE>
<CAPTION>
FIRST ENTERTAINMENT HOLDING CORP. AND SUBSIDIARIES 
(Formerly First Entertainment, Inc. and Subsidiaries) 
Consolidated Statements of Cash Flows
</CAPTION>
For the Years Ended December 31, 1997 and 1996

                                              1997                 1996  
<S>                                       <C>             <C>
OPERATING ACTIVITIES
 Net loss                                 $ (3,614,222)   $ (1,262,160)
 Adjustments to reconcile net loss to
  net cash used in operations
   Depreciation and amortization               141,176         326,522
   Impairment write downs                    1,460,018
   Assets write downs included in
    discontinued operations                    445,596
   Litigation settlement                       150,000
   Debt settlements                                            (21,342)
   (Gain) on disposal of Image                                (413,704)
   Issuance of stock for services and common 
    stock options and warrants, net          1,110,240         548,841
  Amortization of deferred compensation         45,807         217,258
  Minority interest in net loss of
 Subsidiary                                    (11,473)
 Changes in operating assets and liabilities:
   Receivables                                  (6,742)        130,369
   Inventories                                     366          (1,509)
   Other assets                                 (7,711)           (221)
   Accounts payable                             40,207          28,233
   Accrued liabilities                         (48,305)        369,492
   Cash (used in) discontinued operations                      (94,526)
-----------------------------------------------------------------------
NET CASH (USED IN) OPERATING ACTIVITIES       (295,043)       (172,747)
-----------------------------------------------------------------------

<CAPTION>
"See accompanying reports of independent certified public accountants 
and notes to consolidated financial statements."
</CAPTION>
</TABLE>

<TABLE>
<CAPTION>
FIRST ENTERTAINMENTHOLDING CORP. AND SUBSIDIARIES 
(Formerly First Entertainment, Inc. and Subsidiaries) 
Consolidated Statements of Cash Flows (Continued)
</CAPTION>
For the Years Ended December 31, 1997 and 1996

                                               1997              1996    
<S>                                        <C>               <C>
INVESTING ACTIVITIES
 Capital expenditures                       (20,620)          	(16,147)
 Advances to related parties                (10,000)          (10,000)
 Repayment from related parties                               100,000
 Cash used in discontinued operations       (41,786)          	(29,513)
----------------------------------------------------------------------
NET CASH (USED IN) PROVIDED BY 
INVESTING ACTIVITIES                        (72,406)           44,340
--------------------------------------------------------------------
FINANCING ACTIVITIES
 Principal payments on debt                 (51,380)	          (66,453)
 Proceeds from issuance of stock
  of subsidiary                              50,000	           150,000
 Proceeds from issuance of common and
  preferred stock, net                      337,750	            22,500
---------------------------------------------------------------------
NET CASH PROVIDED BY FINANCING
  ACTIVITIES                                336,370           106,047
---------------------------------------------------------------------
NET (DECREASE) IN CASH
AND CASH EQUIVALENTS                        (31,079)          (22,360)

CASH AND CASH EQUIVALENTS, 
BEGINNING OF YEAR                            49,128	            71,488
---------------------------------------------------------------------
CASH AND CASH EQUIVALENTS, 
END OF YEAR                                $ 18,049         $  49,128
======================================================================
SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION
 Interest paid                             $ 25,798          $ 98,054
=====================================================================
 Income taxes paid                         $      0          $     0
=====================================================================

<CAPTION>
"See accompanying reports of independent certified public accountants 
and notes to consolidated financial statements."
</CAPTION>
</TABLE>

<TABLE>
<CAPTION>
FIRST ENTERTAINMENT HLDING CORP. AND SUBSIDIARIES
(Formerly First Entertainment, Inc. and Subsidiaries) 
Consolidated Statements of Cash Flows (Continued)
</CAPTION>
For the Years Ended December 31, 1997 and 1996

                                                 1997           1996   
SUPPLEMENTAL SCHEDULE OF
NONCASH INVESTING AND
FINANCING ACTIVITIES
<S>                                             <C>         <C>
 Accounts payable and accrued expenses
  converted into common stock                   $ 270,800   $  
=======================================================================
 Issuance of common stock for
  inventory and other licensing
   rights                                                   $ 1,000,000
=======================================================================
 Issuance of preferred stock
  for acquisitions                               $ 386,900  $   275,000
=======================================================================
 Note Payable issued in exchange for
  preferred stock                                $ 125,000  $  
=======================================================================
 Mortgage notes assumed or provided in 
  property acquisitions                          $          $   	150,000
=======================================================================
 Common stock and options and warrants
   issued for services                         $ 1,110,240  $   548,841
=======================================================================
 Common stock issued for investment
  in subsidiary                                             $   408,100
=======================================================================
 Liabilities assumed for investment
  in subsidiary                                $            $   	130,544
=======================================================================
 Conversion of liabilities assumed 
  for investment in subsidiary
   to minority interest                        $            $	   100,000  
=======================================================================
 Rights acquired for note payable              $            $   	800,000  
======================================================================
 Inventory seized in settlement of note
  Payable                                      $            $   	800,000
=======================================================================
 Inventory seized resulting in accounts
  receivable, other                            $            $   	200,000
=======================================================================

<CAPTION>
"See accompanying reports of independent certified public accountants 
and notes to consolidated financial statements."
</CAPTION>
</TABLE>

FIRST ENTERTAINMENT HOLDING CORP. AND SUBSIDIARIES
Notes to Consolidated Financial Statements

NOTE A  NATURE OF BUSINESS AND GOING CONCERN

On December 15, 1997, First Entertainment, Inc. changed its state of 
incorporation from Colorado to Nevada and changed its name to First 
Entertainment Holding Corp. (the "Company" or "FEHC").  The 
change was effected by a merger of First Entertainment, Inc. into 
First Entertainment Holding Corp, a newly formed Nevada Corporation.  
Upon completion of the merger, the Colorado Corporation ceased to 
exist.  The transaction was accounted for on a basis similar to a 
pooling of interests with no change in the historical financial 
statements of the Company.  The newly formed Corporation had no 
operations prior to the merger.

The Company was originally incorporated as a Colorado corporation on 
January 17, 1985.  The Company and its subsidiaries are involved in 
entertainment through several media; its live entertainment segment 
owns and operates a comedy club and its radio station, 100.7 "The 
Fox", operates in Gillette, Wyoming.  In January 1998, the Company 
determined to discontinue the operations of its retail segment.

During the period from inception (January 17, 1985) to December 31, 
1997, the Company has incurred cumulative net losses of approximately  
$15 million and, as of December 31, 1997, had an excess of current 
liabilities over current assets of approximately $1.4 million and is 
in default on approximately $386,000 notes payable.  These conditions 
raise substantial doubt about the Company's ability to continue as a 
going concern.  The Company is dependent upon obtaining additional 
financing, and/or extending its existing debt obligations, and/or 
obtaining additional equity capital and ultimately achieving 
profitable operations. The accompanying consolidated financial 
statements do not include any adjustments that might result from the 
outcome of these uncertainties.  

Management's plans with regard to the Company's ability to continue 
as a going concern include  continued raising of equity financing in 
the U.S. and/or international markets, restructuring of its debt 
obligations and undertaking  mergers or acquisitions to improve 
market share or operational synergies and improving efficiency of 
operations.  There are no assurances that any of these events will 
occur or that the Company's plan will be successful.

The Company does not have sufficient revenues to generate income from 
operations; therefore, it is necessary for the Company to increase 
revenues either by expansion or by acquisition or significantly 
reduce its operating costs.  The Company has been able to issue stock 
for management and accounting services, thereby reducing the need for 
cash to pay for operating expenses.  If the Company would be unable 
to issue stock for services, because there would be no liquidity for 
the stock, this would have a severe impact upon the Company and its 
ability to operate.  The value of services paid by issuance of stock 
was approximately $676,000 in 1997 and $548,000 in 1996.  Net cash 
used in operations was $295,000 in 1997 and, unless operations become 
more profitable, the Company most likely will not have sufficient 
cash for use in operations through December 31, 1999.

The Company believes that current cash, plus $213,000 in equity 
financing through September 30, 1998, are sufficient to meet its 
obligations through December 31, 1998.

NOTE B  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Consolidation   The accompanying consolidated financial 
statements include the accounts of the Company and its subsidiaries.  
All significant intercompany accounts and transactions have been 
eliminated.

Use of Estimates  The preparation of financial statements in 
	conformity with generally accepted accounting principles necessarily 
requires management to make estimates and assumptions that affect the 
reported amounts of assets and liabilities, the disclosure of 
contingent assets and liabilities at the date of the financial 
statements and reported amounts of revenues and expense during the 
reporting periods. Actual results could differ from those estimates.

NOTE B SUMMARY OF SIGNIFICANT ACCOUNTING POLICES (Continued) 

		Inventories   Inventories are stated at the lower of cost or market 
value (first-in, first-out basis).  Inventories are comprised of 
video cassettes and liquor supplies.  

Property and Equipment   The Company has a library of master video 
tapes and film cost inventory related to its video product line.  
Capitalized costs, when completed on acquisitions, are amortized over 
the estimated economic life of the master tape, generally not in 
excess of seven years.  The excess, if any, of the capitalized costs 
of master tapes over anticipated gross revenues is charged to expense 
under SFAS No. 121.

Production equipment, furniture and other equipment are recorded at 
cost and depreciated using straight-line and declining balance 
methods over the estimated useful lives of the assets, ranging from 
three to fifteen years.

Leasehold improvements are recorded at cost and are amortized on a 
straight-line basis over their estimated useful lives, but not in 
excess of the lease term.  

The cost and related accumulated depreciation and amortization of 
assets sold or retired are removed from the appropriate asset and 
accumulated depreciation and amortization accounts and the resulting 
gain or loss is reflected in operations.  

Maintenance and repairs are charged to operations as incurred and 
expenditures for major improvements are capitalized.  

License, Goodwill and Intangibles   Broadcast licenses, goodwill and 
intangibles, recorded at cost, are amortized on a straight-line basis 
over a period of 10 to 20 years.

Periodically the Company reviews the recoverability of its intangible 
assets based on estimated undiscounted future cash flows from 
operating activities compared with the carrying value of the 
intangible assets.  Should the aggregate future cash flows be less 
than the carrying value, a write-down would be required measured by 
the difference between the discounted future cash flow and the 
carrying value of the intangible assets under SFAS No. 121.

Long Lived Assets

Long lived assets and identifiable intangibles are reviewed for 
impairment whenever events or changes in circumstances indicate that 
the carrying amount may not be recoverable.  If the expected 
undiscontinued future cash flow from the use of the assets and its 
eventual disposition is less than the carrying amount of the assets, 
an impairment loss is recognized and measured using the asset's fair 
value or discontinued cash flows.

Revenue Recognition   Video cassette sales and copyrighted materials 
are generally recorded upon shipment.  Broadcast and ad fees are 
recorded as revenue when the broadcast or ad is aired.  Live 
Entertainment revenues are recognized at the time of the performance, 
generally nightly.  Retail sales are recognized at the time the 
merchandise is sold and are net of returns.

Net Loss Per Share   As of December 31, 1997, the Company adopted Statement of 
Financial Accounting Standards No. 128 "Earnings per Share" (SFAS No. 128). 
This pronouncement provides a different method of calculating earnings per
share than is currently used in accordance with Accounting Board Opinion
(APB No. 15), "Earnings per Share".  SFAS No. 128 provides for the
calculation of "Basic" and "Dilutive" earnings per share.  Basic earnings
per share includes no dilution and is computed by dividing income available
to common stockholders by the weighted average number of common shares
outstanding for the period.  Diluted earnings per share reflects the
potential dilution of securities that could share in the earnings of the 
entity.  For all prior periods, weighted average and per share information
has been restated in accordance with SFAS No. 128.  The adoption of SFAS No.
128 did not effect earnings per share calculations for the years ended
December 31, 1997 and 1996.  For the years ended December 31, 1997 and 1996,
total stock options and stock warrants of 908,375 and 95,000 were not
included in the computation of diluted earnings per shares because their
effect was anti-dilutive

Concentration of Risk   Financial instruments which potentially 
expose the Company to concentration of credit risk consist primarily 
of cash equivalents and accounts receivable with the Company's 
various customers.  The Company establishes an allowance for doubtful 
accounts based on factors surrounding the credit risk of specific 
customers, historical trends and other information. 

The Company maintains all cash in bank deposit accounts which at 
times may exceed federally insured limits.  The Company has not 
experienced losses in such accounts.

Reclassifications   Certain balances in the 1996 consolidated 
financial statements have been reclassified in order to conform to 
the 1997 presentation.  The reclassifications had no effect on 
financial condition or results of operations.

Income Taxes The Company accounts for income taxes under Statement of 
Financial Accounting Standard No. 109 ("SFAS No. 109").  Temporary 
differences are differences between the tax basis of assets and 
liabilities and their reported amounts in the financial statements 
that will result in taxable or deductible amounts in future years.

Deferred Compensation   Deferred compensation results from granting 
stock options at option prices less than the fair market value of the 
stock on the date of grant, under agreements with terms extending 
beyond one year.  Deferred compensation is initially charged to 
stockholders' equity and amortized to expense over the term of the 
related agreement.

Cash Equivalents   The Company considers all highly liquid debt 
instruments purchased with an original maturity of three months or 
less to be cash equivalents. 

Financial Instruments   The following methods and assumptions were 
used to estimate the fair value of each class of financial 
instruments for which it is practicable to estimate that value;

Accounts Receivable, Accounts Payable and Accrued Liabilities Fair 
values of accounts receivables, accounts payable, and accrued 
liabilities are assumed to approximate carrying values for these 
financial instruments since they are short term in nature and their 
carrying amounts approximate fair value or they are receivable or 
payable on demand.

Notes Payable   These notes substantially bear interest at a floating 
rate of interest based upon the lending  institutions prime lending 
rate.  Accordingly, the fair value approximates their reported 
carrying amount at December 31, 1997 and 1996.

Mortgage Notes   Estimated based upon current market borrowing rates 
for loans with similar terms and maturates.

The estimated fair values of the Company's financial instruments  for 
continuing operations are as follows:
<TABLE>
                          December 31, 1997   December 31, 1996
<S>                     <C>       <C>        <C>        <C>
Financial Liabilities   Carrying  Fair       Carrying   Fair
 Notes Payable          Amount    Value      Amount     Value
  and Mortgage Notes   $1,281,496 $1,281,496 $1,060,876 $1,060,876
</TABLE>

Stock Option and Award Plans  The Company applies APB Opinion 25, 
"Accounting for Stock Issued to Employees", and related 
Interpretations in accounting for all stock option plans.  Following 
the guidance of APB Opinion 25, compensation cost has been recognized 
for stock options issued to employees as the excess of the market 
price of the underlying common stock on the date of the grant over 
the exercise price of the Company's stock options on the date of the 
grant.

SFAS No. 123, "Accounting for Stock-Based Compensation', requires 
the Company to provide pro forma information regarding net income as 
if compensation cost for the Company's stock option plans had been 
determined in accordance with the fair value based method prescribed 
in SFAS No. 123.  To provide the required pro forma information, the 
Company estimates the fair value of each stock option at the grant 
date by using the Black-Scholes option-pricing model.

Recent Accounting Pronouncements:

Statement of Financial Accounting Standards No. 130, "Reporting 
Comprehensive Income" is effective for financial statements with 
fiscal years beginning after December 5, 1997. Earlier application is 
permitted.  SFAS No. 130 establishes standards for reporting and 
display of comprehensive income and its components in a full set of 
general-purpose financial statements.  The Company does not expect 
the adoption of SFAS No. 130 to have a material effect, if any, on 
its financial position or result of operations.

Statement of Financial Accounting Standards No. 131, "Disclosure 
about segments of an Enterprises and Related Information" is 
effective for financial statements with fiscal years beginning after 
December 15, 1997.  The new standard requires that public business 
enterprises report certain information about operating segments in 
complete sets of financial statements of interim periods 
issued to shareholders.  It also requires that public business 
enterprises report certain information about their products and 
services, geographic areas in which they operate and their major 
customers.  The Company has not adopted SFAS No. 131; but, it does 
not have a material effect on its results of operation for 1997 and 
1996.

Statement of Financial Accounting Standards No. 132, "Employers" 
Disclosures about Pension and Other Post retirement Benefits' is 
effective for financial statements with fiscal years beginning after 
December 31, 1997.  Earlier application is permitted.  The new 
standard revises employers' disclosures about pension and other post 
retirement benefit plans but does not change the measurement or 
recognition of those plans.  SFAS No. 132 standardizes the disclosure 
requirements for pensions and other post retirement benefits to the 
extent practicable, requires additional information on change in the 
benefit obligations and fair values of the plan assets that will 
facilitate financial analysis, and eliminates certain disclosure 
previously required when no longer useful.  The Company does not 
expect the adoption of SFAS No. 132 to have a material effect, if 
any, on its results of operation.

The FASB has recently issued Statement of Financial Accounting 
Standards No. 133, "Accounting for Derivative Instruments and 
Hedging Activities": (?"FAS No. 133").  SFAS No. 133 established 
standards for recognizing all derivative instruments including those 
for hedging activities as either assets or liabilities in the 
statement of financial position and measuring those instruments at 
fair value.  This Statement is effective for fiscal years beginning 
after June 30, 1999.  The Company has not yet determined the effect 
of SFAS No. 133 on its financial statement.

NOTE C  ACQUISITIONS

  Power Media

In July, 1996, the Company issued 770,000 shares of its restricted 
common stock, valued at $408,100, in exchange for 18,000 of the 
25,000 then issued and outstanding shares of Power Media 
Communications International, Inc. (Power Media), or 72% ownership.  
Power Media was a substantially dormant company that had developed 
the concept of selling infomercial products in kiosks primarily 
located in retail malls.  The Company purchased Power Media because 
it considered the concept viable and, with proper management and 
working capital, could be profitable.

At the time of the acquisition, Power Media had net liabilities of 
approximately $130,000, and as such, the total purchase price for 
Power Media was approximately $538,100.  The acquisition of Power 
Media was accounted for as a purchase and the purchase price in 
excess of net assets acquired was allocated to goodwill.  
Amortization of goodwill was computed on a straight line basis over 
10 years.  Since operations of Power Media prior to the Company's 
acquisition were not material, no proforma information has been 
provided.

In November 1996, a new entity was formed called "The Best Of As 
Seen on TV", Inc. ("ASOTV") for the purpose of acquiring all of 
the issued and outstanding common stock of Power Media and to provide 
original incorporators with ownership in ASOTV.  The original 
incorporators of ASOTV were issued 464,000 shares of ASOTV for par 
value ($.001 per share), which included 220,800 shares issued to NMG, 
LLC, an entity owned by the wife of the president of the Company.  
ASOTV then issued 1,010,000 shares of common stock to the Company for 
their 18,000 shares of Power Media and issued 324,500 shares to an 
unrelated party for the remaining 7,000 shares of Power Media.  In 
addition, ASOTV received a stock subscription from the previous owner 
of the 7,000 shares of Power Media to purchase approximately 325,000 
shares of common stock of ASOTV for $150,000, of which $100,000 was 
received in 1996 and $50,000 received in 1997.  In July 1997, the 
Company issued 100,000 shares of its common stock in exchange for 
100,000 shares of ASOTV owned by NMG, LLC.  As a result of the above 
transactions, ASOTV owned 100% of Power Media and the Company owned 
approximately 58% and 56% of ASOTV as of December 31, 1997 and 1996, 
respectively.

In March 1997, the Company terminated its unmanned kiosk operations, 
which it started in November 1996, when the leases to its first four 
locations were not renewed.  Sales volumes at the unmanned kiosk 
locations were not sufficient for profitable operations.  The 
Company turned its efforts to operating manned kiosks in major 
retail malls.  Each kiosk was approximately 250 square feet and sold 
the top 50 selling infomercial products.  Commencing August, 1997, 
the Company opened six manned kiosk locations in six retail malls 
located in the Denver metropolitan area.  The sales volumes for the 
manned kiosks were less than projected and the operations were 
terminated January 31, 1998.  Although the Company believes the 
concept is viable, it currently does not have the working capital 
necessary to further develop the concept.  The results of operations 
of ASOTV for the years ended December 31, 1997 and 1996 are 
disclosed as discontinued operations.

Global Internet Corp

On May 1, 1997, the Company entered into an agreement with Global Casino, Inc. 
(Global Casino) to acquire 1,500,000 shares of common stock of Global Internet 
Corp. ("Global Internet") owned by Global Casino and a $375,000 note receivable 
from Global Internet owed to Global Casino in exchange for 30,000 shares of
FEHC Class B Convertible Preferred Stock (Class B Stock).  The 1,500,000
shares of common stock represents 50.3% of the issued and outstanding common
stock of Global Internet.  Each share of Class B stock is convertible into
12.5 shares of FEHC restricted  common stock.  At the time FEHC entered into
the Agreement, FEHC did not have a sufficient number of authorized but
unissued shares of common stock to allow for the conversion of the preferred
stock to common stock.  

In addition, the acquisition of Global Internet required the approval of the 
shareholders of FEHC. On December 5, 1997 the shareholders of FEHC approved 
(i)the increase in the authorized shares of FEHC common stock and (ii) the
acquisition of Global Internet Corp.  For accounting purposes control of
Global Internet did not change until December 5, 1997.  December 5, 1997 is
considered the acquisition date.  The acquisition has been accounted for as
a purchase and the excess of purchase price over net assets acquired was
allocated to goodwill.  The operations of Global Internet from
December 5, 1997 have been consolidated with those of the Company.

In June 1997, FEHC also issued 14,080 of Class B convertible 
preferred stock to two officers of Global Internet, in exchange for 
$176,000 accrued but unpaid compensation.  Global Internet owed the 
two officers compensation under the terms of long term employment 
agreements.  For accounting purposes, the Class B convertible 
preferred shares issued were recorded on December 5, 1997, the date 
the shareholders of FEHC approved an increase in the authorized 
shares of common stock.

Global Internet was in the process of developing a virtual internet 
casino and had a Web Site Development and Maintenance Agreement 
(Development Agreement) with Electronic Data Systems (EDS) and DDB 
Needham to develop the web site for approximately $1,200,000, of 
which $300,000 had been expended to date on the web site 
development.  FEHC was unable to obtain the financing needed to 
complete the web site development and the Development Agreement was 
terminated. 

The ability of the Company to obtain the necessary financing to 
commence operations of a virtual internet casino is uncertain and as 
such the Company's investment in Global Internet was determined by 
management to be impaired.  Included in the accompanying 
consolidated statements of operations for the year ended December 
31, 1997 is an impairment write-off of approximately $558,000 
representing the Company's investment in Global Internet.

The following unaudited pro forma summary presents information as if 
the acquisition of Global Internet had occurred at the beginning of 
each period presented.  The pro forma information is provided for 
informational purposes only and does not purport to be indicative of 
what would have occurred had the acquisition been made as of those 
dates or of results which may occur in the future.

Pro Forma Information  (Unaudited)
<TABLE>
<S>                                      <C>           <C>
                                            1997          1996
Net Revenues                             $ 2,324,091   	$ 2,120,696

Net loss from continuing operations      $ (3,180,737) $ (2,096,634)

Net Loss per share, continuing operations	$       (.53) 	$       (.50)
</TABLE>

NOTE D  DISCONTINUED OPERATIONS

In November 1995, the Board of Directors decided to discontinue the 
operations of Image Marketing Group, Inc. (Image). Accordingly, the 
assets of Image were written down to their estimated net realizable 
value resulting in a write down of $1.6 million as of December 31, 
1995.  In April, 1996, the Company sold Image to a former director 
for $1,000 resulting in a gain on the sale of Image of approximately 
$413,000.  At the time of the disposition of Image, Image had 
liabilities in excess of assets of approximately $414,000.

In January 1998, the Company determined to discontinue the 
operations of ASOTV due to losses and lack of working capital to 
further develop the concept.  Accordingly, the assets of ASOTV were 
written down to their estimated net realizable value resulting in a 
write down of $490,000 included in the accompanying statement of 
operations for the year ended December 31, 1997.

Revenues from discontinued operations were $174,799 and $18,756 for 
1997 and 1996, respectively. 

Summarized balance sheet data for the discontinued operations as of 
December 31, 1997 and 1996 is as follows:
<TABLE>
<S>                                   <C>           <C>
                                           1997           1996
   ASSETS
   Cash                                  $ 9,289       $ 13,728
   Accounts receivable                     6,983         18,756 
   Inventory                              66,482         27,539
   Other                                     100
--------------------------------------------------------------- 
  Total current assets                   82,854         60,023
   Goodwill                                             511,712
   Property, plant and equipment, net      8,673         29,513
--------------------------------------------------------------
   Total Assets                           91,527        601,248
---------------------------------------------------------------
  LIABILITIES
   Current liabilities                   144,578         24,211
 --------------------------------------------------------------
   Total Liabilities                     144,578         24,211
--------------------------------------------------------------
  Minority Interest                           0        163,787
--------------------------------------------------------------
  Net assets (liabilities) of 
   discontinued operations            $ (53,051)      $413,250
===============================================================
</TABLE>

NOTE E   NOTES PAYABLE AND LONG-TERM DEBT

The Company is in default under the terms of approximately $386,000 
of its debt obligations for non-payment. Substantially all of the 
Company's assets are pledged as collateral to one or more 
obligations.  Notes that are not in compliance are classified as 
current liabilities.  Notes payable and long term debt is summarized 
as follows:
<TABLE>
                                             December 31,
   <S>                                    <C>        <C>
                                           1997         1996    
   Notes payable, First National 
    Bank Gillette (1)                     $ 422,152   $	458,719
    Note payable to the 
     State of Wyoming(2)                    300,000    300,000
    Notes payable, litigation (7)           275,000          0
    Mortgage note payable(3)                144,665    149,561
    Mortgage note payable(4)                 53,883     54,390
    Note payable, creditor(5)                19,224     19,224
    Various notes payable individuals 
     and companies(6)                        66,572     78,982
--------------------------------------------------------------
                                          1,281,496  1,060,876
    Less current portion                    850,376    861,392
--------------------------------------------------------------
    Long-term debt                        $ 431,120  $ 199,484
==============================================================
</TABLE>

	Future maturities of debt as of December 31, 1997 are as follows:
<TABLE>
          <C>                     <C>
     1998                    $ 850,376
     1999                      238,471
     2000                        6,171
     2001                       58,683
     2002                        6,631
     Thereafter                121,164
     Total                  $1,281,496
                                  ==========
</TABLE>

 (1) The Notes payable to First National Bank of Gillette are 
revolving notes payable that are renewed annually.  Currently 
the notes bear interest at 10.5% per annum and require monthly 
principal and interest of $6,500.  The notes are collateralized 
by substantially all the assets of the radio station in 
Gillette, Wyoming except for the real estate.

(2) In February 1989, the Company borrowed $300,000 from the State 
of Wyoming for the purpose of purchasing equipment, inventory 
and to provide working capital necessary to establish a video 
duplicating facility.  As of December 31, 1997, the Company had 
not yet established an operating duplicating facility and was in 
violation of several of the compliance requirements of this 
note.  Although the note, by its original terms, is not due 
until March 1, 1999, the State of Wyoming has deemed the note to 
be currently due as a result of the violations of the compliance 
requirements.  The note, with default interest at 16.5 percent, 
is due in daily installments of $150, and is collateralized by 
the Company's master tape library.

 (3) Note payable, trust; interest at 9.5%; monthly principal and 
interest of $1,500; final payment due October 2012; 
collateralized by real property.

	(4) Note payable to mortgage company; interest at 8.015% per 
annum; monthly principal and interest payments of $403 for 59 
months with a balloon payment of $52,300 due May 15, 2000;  
collateralized by real estate.

 (5) Note payable to a trade creditor dated October 21, 1993; 
interest at 10 percent; due on May 1, 1996;  collateralized by 
the Company's master tape inventory and subordinated to 
previously filed liens.  

 (6) Various notes payable in default; due to various individuals 
and companies with rates ranging from 10 to 21 percent per 
annum.

 (7) Notes payable due to two individuals in connection with 
litigation settlements subsequent to December 31, 1997.  The 
first note for $125,000 bears interest at 9.5% per annum and is 
due March 31, 1999.  The second note for $150,000 bears interest 
at 10% per annum and is payable in installments of $25,000 for 
the first month and of $5,000 per month thereafter until July 
15, 1999 at which time all unpaid principal and interest are 
due.  This note is secured by the stock of  FEHC wholly owned 
subsidiary, Quality Communications, Inc, which operates the 
Company's radio station.

The weighted average interest rate on short-term borrowings was 
13.49% and 14.54% for 1997 and 1996, respectively. 

NOTE F   STOCKHOLDERS' EQUITY

On December 15, 1997 First Entertainment, Inc. (FEI) (a Colorado 
Corporation) was merged into First Entertainment Holding Corp. 
(FEHC) (a Nevada Corporation) following a special shareholders 
meeting on December 5, 1997 in which the shareholders approved a 
name change and a change in the state of incorporation from Colorado 
to Nevada.  As a result of the merger, all of the issued and 
outstanding shares of FEI were exchanged for the same amount of 
shares of FEHC.  FEHC is the surviving corporation and, effective 
with the merger, FEI ceased to exist.  FEHC has authorized capital 
stock consisting of 50,000,000 shares of common stock, $.008 par 
value and 5,000,000 shares of preferred stock, $.001 par value.  The 
Board of Directors has the authority to issue preferred shares in 
series and determine the rights and preferences of each series.

A total of 1,500,000 shares of preferred stock has been designated 
as Class A, 7% cumulative, non-participating convertible preferred 
stock, had a mandatory redemption on November 18, 1996.  
Liquidation preference is approximately $15,000.  Each class A share 
may be converted into two shares of common stock.  The Class A 
Preferred Stock has not been redeemed as of December 31, 1997.

A total of 1,000,000 shares of preferred stock has been designated 
as Class B, 6% cumulative dividend, paid quarterly, if and then 
declared, redeemable by the Corporation at face value and each share 
of class B is convertible into 12.5 shares of common stock.  The 
rights of the class B shall be subordinate to Class A.

A total of 1,000,000 shares of preferred stock has been designated 
as Class C, non-dividend and each share is convertible into common 
stock at a conversion price equal to the average 30 day bid price of 
the common stock on the date of conversion.  The rights of the class 
C shall be subordinate to Class A and Class B.

On April 9, 1996, the Board of Directors approved a 4 for 1 reverse 
stock spilt.  Accordingly, all references in the consolidated 
financial statements to average number of shares outstanding and 
related prices, per share amounts, common stock purchase rights, 
stock option plan data and shares issued have been restated to 
reflect the reverse stock split.

In connection with the acquisition of Global Internet Corporation, 
the Company entered into an agreement with two officers of Global 
Internet on June 16, 1997 whereby the Company would issue 14,080 
shares of Class B convertible preferred stock in exchange for 
$176,000 of debt owed to the two officers by Global Internet.

In 1997, the Company issued 751,600 shares of common stock for consulting and 
other services valued at $676,215 (includes $252,000 in services from related 
parties) or an average of $.90 per share.  In 1996, the Company issued 532,700 
shares of common stock for consulting and other services valued at $533,841 
(includes $240,000 in services from related parties) or an average $1.00 per 
share.  In 1997, the Company also issued 440,000 shares of common stock in 
settlement of accrued bonus's to consultants and employees and accounts 
payable totaling $270,800.  Stock bonus's accrued for related parties was 
$168,000.

In 1997, the Company issued 47,067 shares of Class B Convertible Preferred
Stock for $262,750, which was net of offering costs of $39,750.  The Company
also issued 150,000 shares of common stock upon exercise of common stock
options receiving proceeds of $75,000.

In 1997, the Company cancelled 221,534 shares of common stock held as treasury 
of which 144,409 represented shares returned to the Company in connection with
a litigation settlement with Image Marketing Group (Note K); 50,000
represented the cancellation of common stock held by a bank as collateral on
a note payable and 27,125 represented shares previously held by
First Films, Inc.

Common Stock Options   In June 1994, the Company adopted a Non-
Qualified Stock Option Plan, under which the Company's Board of 
Directors are authorized to issue options to purchase up to 62,500 
shares of the Company's common stock to qualified employees, 
officers and directors of the Company.  The option price may be 
changed at the discretion of the Board of Directors.  No options 
have been issued under this plan.  During 1997 and 1996, the Company 
has also issued other non-qualified stock options to non-employees 
under terms and at prices deemed appropriate by the Board of 
Directors.

	The following is a summary of the number of shares under option:
<TABLE>
   
                                                  Weighted
                                                  Average
                                 Non-Qualifying   Exercise   	Expiration  
                                 Stock Options    Price      	Dates     
   <S>                           <C>              <C>        <C>

Balance, January 1, 1996       95,000          $ 3.49     	1996-1998
         Granted               50,000             .75          1996
            Exercised            (50,000)            .75
         Expired____________________________________________________
----------------------------------------------------------------------
   Balance, December 31, 1996     95,000            3.49  
            Granted              400,000             .79     1999-2002
         Exercised           (100,000)            .50
            Expired/Rescinded   (285,625)           2.39_______________
-----------------------------------------------------------------------
   Balance, December 31, 1997    109,375          $ 2.91     1998-2002
============================================================================
</TABLE>

The following table summarized information about stock options 
outstanding and exercisable as of December 31, 1997:
<TABLE>
                                            Weighted 
                                             Average         	Weighted
      Range of             Number           Remaining        	Average 
  Exercise Prices       Outstanding &      Contractual       Exercise
  From     To           Exercisable        Life in Years     Price   
  <C>      <C>          <C>                   <C>           <C>
  $ 6.40   $	10.48         9,375                0.75          $ 7.22
  $  .50   $	 1.25       100,000                2.50          $  .87
                        109,375                2.00          $ 2.91
===================================================================
</TABLE>

Options issued to non-employees in 1997 resulted in compensation 
expense in 1997 of $78,617 under SFAS 123.

Subsequent to year end an option was issued to purchase 300,000 shares 
of common stock at $.40 per share.  The option is exercisable for a 
period of one year.

NOTE G COMMON STOCK WARRANTS

In connection with a settlement agreement between the Company and 
Balzac, Inc, a warrant was issued to Balzac to purchase 500,000 
shares of the Company's common stock at $1.00 per share. 

The warrant, issued at fair market value, is exercisable for a 
period of five years and expires April, 2002.The issuance of these 
warrants to Balzac resulted in compensation expense of $315,453 in 
1997 under SFAS 123.

In connection with the private sale of Class B convertible preferred 
stock, the Company granted to the Underwriter a warrant to purchase 
300,000 shares of the Company's common stock at $1.00 per share.  
The warrant, issued at fair market value, is for consideration of 
future consulting services and expires July, 1999.  The issuance of 
these warrants to the Underwriter resulted in compensation expense 
of $33,434 in 1997 under SFAS 123.

In addition, the two officers of Global Internet have the option, 
for a period of five years, to exchange any or all of their 600,000 
shares of common stock of Global Internet into FEHC common stock at 
a rate of one share of FEHC for four shares of Global Internet.  In 
addition, for each share exchanged the officers of Global Internet 
will receive one warrant to purchase one share of FEHC common stock 
at $1.25 a share.

The Company has elected to continue with the accounting treatment 
for stock options and warrants issued to employees under APB 25, 
which is an intrinsic value-based method, and has not adopted SFAS 
123, which is a fair-value based method of accounting for stock 
options. The Company estimates the fair value of each stock award 
at the grant date by using the Black-Scholes option-pricing model 
with the following weighted average assumptions, used for grants in 
1997; dividend yield of 0%, expected volatility of .1%, risk free 
interest rate of 6%, and expected lives of 5 years for the stock 
award.  Had compensation costs been determined based on the fair 
value at the grant date for stock option and stock warrant grants 
to employees consistent with the method of SFAS No. 123, the Company's net 
loss from continuing operations and net 
loss per share from continuing operations would have increased as 
indicated below for the year ended December 31, 1997.
<TABLE>
<S>                                                   <C>
Net(loss)from continuing operations, as reported      ($2,882,769)
Net (loss) from continuing operations, pro-forma      ($2,898,513)
    Net (loss) per share, continuing operations 
    basic and diluted, as reported                              ($.48)
    Net (loss) per share, continuing operations basic
    and diluted, pro-forma                                      ($.48)
</TABLE>

NOTE H   INCOME TAXES

The tax effects of temporary differences and carryforward amounts 
that give rise to significant portions of the deferred tax assets 
and deferred tax liabilities as of December 31, 1997 and 1996 are:
<TABLE>
  Deferred tax assets:                         1997            1996 
    <S>                                    <C>             <C>     
    Net operating loss carryforwards       $ 5,466,000     $ 	4,195,000
    Property, equipment, other assets, net      (6,000)         42,000
    Stock bonus accrual                                         95,000
    Litigation settlement                      102,000          43,000
    Discontinued operations                   (181,000)
    Other	                                      88,000          25,000
   ------------------------------------------------------------------
    Total gross deferred tax assets          5,469,000       	4,400,000
    Less valuation allowance                (5,469,000)     (4,400,000)
   -------------------------------------------------------------------
    Net deferred tax assets                $         0     $         0
======================================================================
</TABLE>

    A valuation allowance has been recorded equal to  the net deferred 
tax asset, as management was not able to determine if it is more likely 
than not that the deferred tax assets will be realized.

The valuation allowance increased $1,069,000 in 1997 and $561,000 in 
1996.

The following summary reconciles the income taxes at the statutory 
rate of 34% in 1997 and 1996 with the actual taxes:
<TABLE>
                                              1997           1996
<S>                                         <C>            <C>
Benefit computed at the statutory 
rate-continuing operations                   $ (980,000)    $ (551,000) 
Discontinued operations                        ( 89,000)       (10,000)
Valuation allowance                           1,069,000        561,000
----------------------------------------------------------------------
Provision for income taxes                   $        0     $        0
----------------------------------------------------------------------
</TABLE>

As of December 31, 1997, net operating loss carryforwards were 
approximately $14 million.  Utilization of certain portions of this 
amount is subject to limitations under the Internal Revenue Code.  
Carryforward amounts expire at various dates through 2017.  

NOTE I  RELATED PARTY TRANSACTIONS

In April 1996, the Company acquired the office building and land 
which houses its radio station and the land occupied by its radio 
tower for $425,000 from a trust controlled by a former officer of 
the Company.  The Company issued 275,000 shares of Class C Preferred 
Stock valued at $275,000 and a mortgage note in the amount of 
$150,000.  In 1996, Class C Preferred Stock valued at $150,000 was 
converted into 150,000 shares of common stock.  In connection with 
litigation settlement, the remaining preferred stock valued at 
$125,000 was returned to the Company in exchange for a mortgage note 
of $125,000.

Commencing April 1995, the Company contracted out some 
administrative, management and accounting functions of the Company 
to a company wholly owned by the former president and director of 
the Company.  Monthly fees for such services were $21,000 for 1997 
and $20,000 for 1996.  Total annual fees paid by the issuancw of 
common stock for 1997 and 1996 were $252,000 and $240,000 each year, 
respectively.  The affiliated company sub-leases office space from 
the Company on a month-to-month lease for $500 per month.  In 
addition, in 1996 the Company accrued a stock bonus of $168,000 due 
to the service company payable in common stock which was issued in 
February 1997.  The stock bonus award was based on recognition of 
prior services provided to the Company.

In July 1997, the Company acquired 100,000 shares of common stock of 
ASOTV from NMG, LLC, an entity owned by the wife of the president, 
in exchange for 100,000 shares of common stock of the Company.  The 
value of the common stock issued to NMG, LLC, $50,000, has been 
classified as officer compensation in the accompanying consolidated 
statements of operations.

Consulting fees were paid to the wife of the President for the years 
ended December 31, 1997 and 1996 in the amount of $5,500 and 
$12,000, respectively.  The amounts paid to the wife of the 
President have been classified as officer compensation in the 
accompanying consolidated statement of operations. 

NOTE J   COMMITMENTS

   Lease Commitments   The Company has long-term operating lease 
agreements for office space, building and certain equipment. Future 
minimum lease payments required under long-term leases in effect at 
December 31, 1997 are as follows:
<TABLE>
          <C>        <C>
          1998       $118,537
          1999        131,056
          2000        112,008
          2001        108,401
          2002         77,976
</TABLE>

Rent expense for continuing operations was $176,765 and $165,047 in 
1997 and 1996.  Rent expense for discontinued operations was $77,365 
in 1997 and $0 in 1996.

Commencing September,1998 the Company subleased its executive space 
under the terms of a four year sublease.  The Company has not been 
relieved of its primary obligation due under the original lease with 
the lessor.  The sublease calls for payments of $6,824 per month for 
48 months commencing September 1, 1998.

NOTE K   LITIGATION

FEHC knows of no litigation pending, threatened, or contemplated, or 
unsatisfied judgments against it, or any proceedings of which FEHC 
or any of its subsidiaries is a party, except as specified below.  
FEHC knows of no legal actions pending or threatened, or judgment 
entered against any of its officers or directors or any of its 
subsidiaries in their capacities as such, except as specified below.  

In January 1996, the Company, AB Goldberg, Harvey Rosenberg and 
several other related and unrelated third parties were named as 
defendants in a lawsuit filed by Sterling Consulting Corporation as 
Receiver for Indian Motorcycle Manufacturing, Inc.("IMMI")  The 
Complaint alleges interference by defendants in the business of 
IMMI, conflicts of interest of AB Goldberg, breach of fiduciary 
duty, unjust enrichment and bankruptcy fraud.

In July 1996, the Company filed suit against the Receiver alleging 
intentional interference of contracted relationships and breach of 
licensing agreements.

In February 1997, the Company agreed to terms of a Settlement 
Agreement with the Receiver whereby the Company would relinquish all 
rights to the Indian Motorcycle Trademark and pay the Receiver 
approximately $114,000. (see Item 1, Other Business Developments)

In March 1997, the Company commenced legal proceedings against Image 
Marketing Group, Inc. and Harvey Rosenberg ( a former officer of the 
Company) , Burt Katz (a former director of the Company) and Michael 
Katz, individually, for collection of approximately $700,000 in 
advances to Image Marketing.  Image Marketing Group, Inc was 
purchased by the Company from Burt Katz, Michael Katz and Harvey 
Rosenberg in September 1994.  From September 1994 to November 1995 
the Company advanced Image approximately $700,000.  In November, 
1995, the Company determined to discontinue the operations of Image 
due to substantial losses and demanded repayment of the advances to 
Image.  Image was unable to repay the advances; therefore, the 
Company commenced legal proceedings against Image and its former 
shareholders.  In July 1997, a settlement was reached with Image 
Marketing Group, Harvey Rosenberg, Burt Katz and Michael Katz 
whereby 144,410 shares of FEHC common stock held by the defendants 
were returned to FEHC.  The shares returned were cancelled and 
returned to treasury.

In 1997, the Company commenced legal proceedings against HK Retail 
Concepts for breach of contract.  The claims are for damages of 
approximately $50,000.  The Suit was filed in Denver District County 
Court in May 1997 and is waiting trial in January 1999.

In May 1997, David Spolter and Faige Spolter (Spolter) filed a 
lawsuit against FEHC in the Superior Court of the State of 
California.  The plaintiffs alleged various federal and state 
securities violations and sought recovery of their $75,000 
investment plus damages.  On July 1, 1998, Spolter and FEHC entered 
into a settlement agreement whereby FEHC agreed to pay Spolter 
$150,000.  $25,000 was paid upon execution of the Settlement 
Agreement and the remaining $125,000 shall be payable in monthly 
installments of $5,000 a month until July 15, 1999 at which time all 
unpaid principal and interest shall become due and payable.  The 
note bears interest of 10% per annum.  FEHC agreed to pledge all of 
its stock of its wholly owned subsidiary, Quality Communications, 
Inc. and to provide a security interest in all assets of Quality 
Communications, Inc.  In the event of default, the amount due shall 
be $180,000 plus interest at 10% from June 1, 1998, less amounts 
previously paid.  Any unpaid amounts shall be due and payable upon 
sale of the radio station in Gillette, Wyoming.

In 1997, Sharon K. Doud filed a civil action against FEHC, AB 
Goldberg and Quality Communications for breach of contract, fraud 
and misrepresentation for failure to convert Class C Convertible 
Preferred Stock into 91,240 shares of common stock.  In April 1998, 
a settlement agreement was reached between FEHC and Sharon Doud 
whereby FEHC was required to pay $6,150 in legal fees, issue a 
promissory note in the principal sum of $125,000 bearing interest at 
9.5% per annum due March 31, 1999 and cancel the Class C Convertible 
Preferred Shares. 

In June 1996, Frank P. D'Alessio, a former director of the Company, 
commenced an action against A.B. Goldberg, president and director of 
the Company, Nannette Goldberg, wife of A.B. Goldberg, Sara 
Goldberg, mother of A.B. Goldberg, Cohig & Associates, Neidiger 
Tucker Brunner, Inc, Hanifin, Inhoff, Inc., Southwest Securities, 
Inc., Paul Davis and Mike Zenhari in the United States District 
Court for the District of Colorado.
 
The suit alleges that the plaintiff (Mr. D'Alessio) was defrauded by 
the defendants pursuant to security transactions involving shares of 
common stock purchased by plaintiff in Video Communications and 
Radio, Inc. (now First Entertainment Holding Corp.). The defendants 
have strenuously denied any violations of any state or federal 
statutory or common law.

On October 1, 1996, the plaintiff and the defendants entered into a 
Settlement Agreement and Mutual Release.  The Settlement Agreement 
required A.B. Goldberg to deliver to the plaintiff 150,000 shares of 
common stock of First Entertainment Holding Corp. by August 1, 1997, 
and such shares will be registered in a Form S-3 filed with the 
Securities and Exchange Commission.  In addition, Mr. Goldberg was 
to deliver to plaintiff a certified or cashier's check in the amount 
of $20,000 by May 5, 1997.

On November 19, 1996, 50,000 shares of common stock of FEHC were 
transferred to Mr. D'Alessio from Mr. Michael Payne, a shareholder 
of the Company.  In July 1996, Mr. Payne had been issued 554,000 
shares of common stock of FEHC in exchange for his shares of common 
stock of Power Media (see Note C).  In July 1997 100,000 shares of 
common stock of FEHC were issued to NMG, LLC, an entity owned by the 
wife of the President of the Company, in exchange for 100,000 shares 
of ASOTV.  (see Note C).  On July 29, 1997, the 100,000 shares of 
common stock acquired by NMG, LLC were transferred to Mr. D'Alessio.

The value of the common stock transferred to Mr. D'Alessio, 
$76,500, has been classified as officer compensation to A.B. 
Goldberg in the accompanying consolidated statements of operations.

NOTE L   FOURTH QUARTER ADJUSTMENTS

During the fourth quarters of 1997 and 1996, the Company recorded 
the following year-end 
adjustments, which it believes are material to the results of that 
quarter:
<TABLE>
                                                 1997    	    1996 
<S>                                          <C>         <C>   
Effect of Balzac dispute resolution 
(see Note M):
  Decrease in inventory                                  $ 	1,000,000
  Decrease in notes payable                              $   	800,000
  Increase in accounts receivable                        $   200,000

Effect of Indian Motorcycle settlement 
(See Note K and M):
 Decrease in receivables                                 $   143,000
 Decrease in certain rights                              $   300,000
 Increase in accrued settlement                          $   114,000
 Decrease in stockholders' equity                        $   300,000
 Decrease in amortization expense due 
 to the above                                            $   127,500
 Write-down of assets, including goodwill
 of discontinued operations of ASOTV to net
   realizable value                          $   490,000
 Impairment write down of Balzac
  note receivable                            $   902,000
 Impairment write down of Global Casino's
  Investment                                 $   558,000
 Compensation for issuance of common stock 
   options and warrants                      $   434,025
</TABLE>

NOTE M SETTLEMENTS AND RESCISSIONS

   Indian Licensing

   Effective March 31, 1996,  the Company entered into a Purchase 
Agreement with certain individuals whereby the Company would acquire 
55% of the issued and outstanding common stock of Indian Motorcycle 
Company Japan, a development stage company, and certain licensing 
rights in exchange for 300,000 shares of the Company's Class C 
Preferred Stock valued at $1.00 per share.  In connection with the 
settlement discussed in Note K, the Company relinquished the rights 
acquired and the 300,000 shares of Class C Preferred stock were 
returned to the Company.

The transactions described above relating to Indian Licensing have 
been rescinded in the accompanying financial statements effective 
from the date the transactions were entered into as if the 
transactions did not occur.

Balzac, Inc.

   In April 1996, the Company acquired certain assets from Balzac, 
Inc., ("Balzac") a private company which manufactures and 
distributes toys, including a product line of toy balls.  The assets 
and rights acquired consisted of: an exclusive license for 
Australia, inventory of Balzac toys and various other rights.  

   The exclusive license agreement for Australia was acquired for 
$800,000 and was payable within five years based upon a formula of 
60% of net profits from the sale of Balzac products in Australia.  
The inventory and other assets were acquired by issuing 1,100,000 
shares of the Company's restricted common stock valued at $1.0 
million.

During 1996, a dispute arose between the Company and Balzac and 
Balzac asserted a violation of the Purchase Agreement.  Balzac 
seized the inventory valued at $1 million, which was collateral on 
the fixed obligation due under the Australian Licensing Agreement, 
to satisfy the $800,000 obligation under the Licensing Agreement.

The Company asserted that Balzac had no right under the Purchase 
Agreement or License Agreement to seize the inventory and apply the 
proceeds against the note obligation under the License Agreement.

   In April 1997, Balzac and the Company entered into an agreement 
whereby Balzac will buy back the Australian Licensing Agreement for 
$800,000 and will repay the Company $200,000 which was the 
difference between the value of the seized inventory and the 
obligation under the licensing agreement.  The $200,000 is 
classified as an account receivable, other in the accompanying 
consolidated balance sheet at December 31, 1997.  The $1,000,000 
will be repaid over forty months at 8% per annum.  The $1,000,000 
will be repaid to the Company through the sale, by Balzac, of 
1,000,000 of the Company's shares of common stock owned by Balzac. 

The ability of Balzac to sell all 1,000,000 shares held by Balzac at 
a price of $1.00 to repay its obligation was determined by 
management to be unlikely.  As of December 31, 1997 the note 
receivable from Balzac was determined to be impaired and was written 
down to its net realizable value of $81,340 resulting in an 
impairment loss of $902,018.

NOTE N SUBSEQUENT EVENTS

In April and June 1998, the Company settled two lawsuits against the 
Company resulting in payables to the plaintiffs totaling $275,000 
(See Note K).

For the nine months ended September 30,1998 the Company sold 771,667 
shares of common stock and 16,000 shares of convertible preferred 
stock for $202,050, net of offering costs.  On June 16, 1998 the 
Company issued a stock option to purchase 300,000 shares of common 
stock for $.40 per share.  The option is exercisable for a period of 
one year.

On September 15, 1998, the Company entered into a definitive 
agreement with SportsNet, Inc. (SNI)  The effective date of the 
Agreement will be ten days after the following two events have 
occurred; (i) SNI has completed a financing of not less than 
$1,000,000 and (ii) the Company has entered into a contract with a 
credit card processor for participants in the Games satisfactory to 
both the Company and SNI.  The Agreement, if and when it becomes 
effective, will continue in effect as long as the Company has a 
valid internet gaming license issued by the Commonwealth  of 
Dominica or will terminate upon revocation of such license by the 
Commonwealth of Dominica.

Under the Agreement, the Company, at its sole cost and expense, will 
be responsible for providing physical facilities, communications 
installation, phone lines and maintenance necessary to accommodate 
and interface with computer hardware located in Dominica.  In 
addition, the Company must provide adequate insurance coverage for 
the equipment owned by the Company and SNI.  The Internet Gaming 
License issued by the Commonwealth of Dominica requires the Company 
to hire five (5) people at the prevailing wage for the term of the 
license and pay 5% of gross revenues derived from the internet 
gaming revenue but not less than $25,000 per year to the 
Commonwealth of Dominica.

In June, 1998 FEHC signed a non-binding letter of intent with 
Intelek, LLC ("Intelek") to form a joint venture with Intelek for 
the purpose of developing and promoting entertainment sites on the 
internet.

FEHC will invest in and receive 50% of the revenues from new sources 
of internet traffic from multiple adult entertainment sites 
presently being operated by Intelek.  FEHC would invest $250,000 and 
issue 250,000 shares of its restricted common stock to Intelek, Inc.  
FEHC would receive a preferential payment of the first $250,000 from 
the new sources of revenue thereafter, FEHC would receive 50% of all 
revenues received from new sources of internet traffic developed.  
Upon receipt of $250,000 FEHC would be obligated to issue an 
additional 250,000 shares of restricted stock.

Consummation of this agreement is subject to a number of conditions 
including the negotiation of a definitive agreement, completion of 
due diligence, approval of the transaction by the Board of Directors 
of both companies and approval of any necessary governmental 
authorities.  Due to the contingencies involved, FEHC is unable to 
predict if or when the transaction will be consummated.

NOTE O    SEGMENT INFORMATION

Financial information by industry segments for the years ended 
December 31, 1997 and 1996 is summarized as follows:  

<TABLE>
                                         Live          Other
                   Radio     Video    Entertainment  Segments (1)(2) 
                                                          
<S>                <C>       <C>      <C>             <C>       
FOR THE YEAR
 ENDED
  DECEMBER 31,
   1997	
Revenue  
 Unaffiliated      $771,992  $ 50,239 $ 1,389,533      	$ 112,327 
 Revenue 
  affiliated                                              175,956       
 Operating
  income 
   (loss),
   continuing 
    operations      104,000  (31,732)	     193,471      (3,065,854)
 Identifiable
  Assets          1,317,535  985,982      337,063       1,318,719
 Depreciation 
 and amortization    87,100   35,525        4,105          14,446
 Capital
  Expenditures       10,144        0        5,224           5,252
</TABLE>

<TABLE>
                          Eliminations     Consolidated
<S>                      <C>                 <C> 
FOR THE YEAR
 ENDED
  DECEMBER 31,
   1997
Revenue  
 Unaffiliated            $        0          $ 2,324,091
 Revenue 
  Affiliated               (175,956)
 Operating
  income 
   (loss),
   continuing 
    operations                                (2,800,115)
 Identifiable
  Assets                 (2,330,567)           1,628,732
 Depreciation 
 and amortization                                141,176
 Capital
  Expenditures                                    20,620
</TABLE>

<TABLE>
                                          Live          Other
                    Radio     Video    Entertainment  Segments (1)(2) 
                                                          
<S>                 <C>       <C>      <C>             <C>       
FOR THE YEAR
 ENDED  DECEMBER 31,
  1996
Revenue
 Unaffiliated       $ 713,322 $ 105,618 $ 1,255,735    $   46,021
 Revenue  
  Affiliated                                              175,956
 Operating 
  income (loss),
  continuing
   operations          51,606  (110,865)     84,134     (1,564,782)
 Identifiable 
  Assets            1,383,683 	1,005,280     259,776      2,558,430
 Depreciation 
  and amortization     77,549   207,000       3,841         38,132
Capital expenditures  439,193                 1,322         30,145 
</TABLE>

<TABLE>

                           Eliminations     Consolidated
<S>                      <C>                 <C> 
FOR THE YEAR
 ENDED
  DECEMBER 31,
   1996
Revenue  
 Unaffiliated            $        0          $ 2,120,696
 Revenue 
  Affiliated               (175,956)
 Operating
  income 
   (loss),
   continuing 
    operations                                (1,539,907)
 Identifiable
  Assets                 (2,162,377)           3,044,792
 Depreciation 
 and amortization                                326,522
 Capital
  Expenditures                                   470,660
</TABLE>


(1) Other segments represents the operations of the parent company 
which is primarily responsible for incurring general and administrative 
expenses. Identifiable assets are essentially investments in 
subsidiaries which are eliminated in consolidation.

(2) Identifiable assets includes net assets of discontinued operations 
in 1996 of $413,250.

Item 8. Changes in and Disagreements with Accountants on Accounting 
and Financial Disclosure

On April 6, 1998, the Company was informed by its independent 
auditors, BDO Seidman, LLP of BDO Seidman, LLP's resignation, 
effective that date.  The reports on the consolidated financial 
statements of the Company for each of the two fiscal years in the 
period ending December 31, 1996 did not contain any adverse opinion 
or disclaimer of opinion and were not qualified as to audit scope or 
accounting principles.  However, the reports of BDO Seidman, LLP did 
contain an explanatory paragraph relative to a going concern 
uncertainty.  There were no accounting disagreements with BDO 
Seidman, LLP that resulted in their resignation. 


PART III

Item 9. Directors , Executive Officers , Promoters and Control 
Persons

Information concerning the Directors and Executive Officers of the 
Company is as follows: 

                                           Tenure as Officer  
Name                  Age     Position     or Director      
[C]                   [C]     [C]          [C]
A. B. Goldberg        50      Director     April 1993 to present
                              President    Commencing February 
and Chief     1995
                              Executive 
                              Officer

William Rubin         38      Director     November 1998 to present

Dr. Theodore Jacobs   66      Director     November 1996 to August 
                                           1998

Dr. Nick Catalano     57      Director     March 1992 to August 1998

Cindy Jones           43	      Secretary and April 1994 to present
                              Treasurer

All of the Directors' terms expire at the next annual meeting of 
shareholders or when their successors have been elected and 
qualified.  The Officers of the Company serve at the pleasure of the 
Board of Directors.  

The following sets forth background information concerning the above 
Directors and Executive Officers:  

Abraham "A.B." Goldberg has been employed by First Films as 
Executive Producer and Financial Consultant since January 1987.  Mr. 
Goldberg served as Executive Producer for "Almost Blue" and "The 
Amityville Curse."  In addition, he served as Executive Producer for 
"Mind Killer," "Night Vision" and "Lone Wolf."  Mr. Goldberg has 
been an independent consultant and has advised several film 
companies, beginning in 1977 with Innovations/ECA, which produced 
"The Buddy Holly Story" starring Gary Busey and "Under The Rainbow" 
starring Chevy Chase and Carrie Fisher.  He also advised Robert 
Halmi Productions, a New York-based production company which was 
merged with Hal Roach Studios and later acquired by Quintex 
Entertainment.  Mr. Goldberg served as President of Harvard 
Financial Group, an independent investment consulting firm, from 
November 1976 through April 1982.  Since April 1982, Mr. Goldberg 
has consulted with a variety of businesses, including First Films.  
Mr. Goldberg earned a Bachelor's Degree in Finance from the 
University of Colorado, Boulder, Colorado in 1969 and attended the 
University of Denver College of Law.  Mr. Goldberg was elected 
President and Chief Executive Officer in February 1995.

William "Bill" Rubin is a commercial loan officer having served as 
a vice president with various financial institutions.  Mr. Rubin's 
responsibilities included underwriting and originating construction 
and real estate loans, workout and restricting of real estate loans 
management of loan portfolios in excess of $150 million.  Mr. Rubin 
earned a BBA in Finance and Accounting from Southern Methodist 
University in 1983.  Mr. Rubin serves as a director for Assets 
Management. 

Dr. Nick Catalano is presently serving in his twenty-fourth year as 
professor of English Literature, Communications and music at Pace 
University, New York City.  He is also the University's director for 
the Performing Arts.  Over the past several years, he has been a 
writer/producer for several television network shows, including The 
Bill Cosby Show, PBS documentaries, Doug Hennings' The World of 
Illusion, and TV specials for Richard Belzer on HBO.  Dr. Catalano 
has produced travelogue videos for Video Trips on Greece, the Greek 
Islands, Utah, St. Martin and is currently completing the Hamptons.  
In addition, he is the founder of "The Big Apple Comedy Showcase" at 
Pace University, now in its 18th year.  It is the oldest college 
comedy series in the country.  Mr. Catalano resigned effective 
August 29, 1998.

Dr. Theodore Jacobs, M.D.  graduated from New York Medical College 
in 1955 where he was honored by achieving the highest award to a 
graduating medical student.  Dr. Jacobs was Board Certified in 
Internal Medicine in 1962 and Re-Certified in 1977.  Since 1963, Dr. 
Jacobs has worked in private practice in Internal Medicine in an 
office in Las Vegas, Nevada.  Dr. Jacobs has served as a member of 
the Nevada State Board of Medical Examiners, serving for fifteen 
years as president from 1980 to 1995.  Dr. Jacobs is currently a 
Clinical Professor of Medicine, University of Nevada School of 
Medicine and Member, Advisory Board to the Dean of the School of 
Medical Sciences, University of Nevada/Reno.  Dr. Jacobs is a member 
of the Board of Directors of Nevada Dance Theater, Las Vegas 
Symphonic and Chamber Music Society and the Nevada Opera Theater.  
Dr. Jacobs has received numerous awards for outstanding achievement 
and contributions to his profession and community.  Dr. Jacobs was a 
member of the Board of Directors of Power Media Communications 
International, Inc.  Dr. Jacobs resigned effective August 7, 1998.

Cynthia Jones  served as the corporate controller for the Company 
from 1982 to 1995.  She currently serves as corporate controller for 
Creative Business Services, Inc.

No family relationship exists between or among any of the persons 
named above.  None of the Company's Directors are directors of any 
other company that has a class of equity securities registered 
under, or required to file reports pursuant to, Section 15(d) of the 
Securities Act of 1933 or Section 12 of the Securities Exchange Act 
of 1934, or any company registered as an investment company under 
the Investment Company Act of 1940.  There are no arrangements or 
understandings between any of the named directors or officers and 
any other persons pursuant to which any director or officer was 
selected or nominated as a director or officer.  

Item 10. Executive Compensation

Only one executive officer received cash compensation in excess of 
$100,000 during the fiscal year ended December 31, 1997 and 1996.  
Compensation does not include minor business-related and other 
expenses paid by the Company for its officers during fiscal year 
1997 and 1996, nor the personal usage of a Company automobile.  Such 
amounts in the aggregate do not exceed $10,000.  The Company's Chief 
Executive Officer, A.B. Goldberg received compensation of $148,000, 
and $96,000 for 1997, and 1996, respectively.  Amounts paid to the 
wife of A.B. Goldberg in the amounts of $12,000 and $5,000 for 1997 
and 1996 have been recorded as officer compensation.  In addition, 
the value of common stock transferred to NMG, LLC in connection with 
litigation settlement are classified as officer compensation. (See 
Part I Item 3)

From time to time, the Company has granted shares of its common 
stock as additional compensation to its officers and key employees 
for their services, as determined by the Company's Board of 
Directors.  During 1997 and 1996, no shares were granted to officers 
or key employees.

As of December 31, 1997, the Company had no group life, health, 
hospitalization, medical reimbursement or relocation plans in effect 
which discriminates, in scope, terms, or operation, in favor of 
officers or directors of the Company and that are not generally 
available to all salaried employees.  Further, the Company has no 
pension plans or plans or agreements which provide compensation on 
the event of termination of employment or change in control of the 
Company.  

The Company does not pay members of its board of Directors any fees 
for attendance or similar remuneration, but reimburses them for any 
out-of-pocket expenses incurred by them in connection with Company 
business.  

<TABLE>
Summary Compensation Table
                  Annual Compensation        Long term
                                               Awards              Payouts
<S>         <C>    <C>    <C>   <C>    <C>        <C>       <C>      <C>
  (a)       (b)    (c)   	(d)   (e)    (f)        (g)       (h)      (i)
Name and                        Other  Restricted Underlying         All Other
Principal                       Annual  Stock     Options   LTIP  Compensation
Position                        Compen- Award(s)  SARs(#)  Payouts      ($)  
          Year   Salary($)Bonus($)sation ($)        ($)      ($)    

A.B. 
Goldberg  1997   $24,000        $47,500  $76,500
President 
and       1996   $24,000        $72,000
Chief 
Executive
Officer
</TABLE>

Item 11. Security Ownership of Certain Beneficial Owners and 
Management

The following table sets forth certain information regarding 
ownership of the Common Stock of the Company as of July 31, 1998 by 
(I) each person known by the Company to be the beneficial owner of 
more than 5 percent of the outstanding common stock of the Company; 
(ii) each director of the Company; and (iii) all executive officers 
and directors of the Company as a group.
<TABLE>
Names and Addresses                            Beneficial   Percent 
  of Beneficial Owner                          Ownership    of Class 
<S>                                            <C>          <C>
Balzac, Inc.                                      975,000   11.5%
7887 E. Belleview, Suite 1114
Englewood, CO 80111

Creative Business Services, Inc.              (2) 577,366    6.8%
5495 Marion Street
Denver, CO 80216

A. B. Goldberg                                (1)  22,338     .3%
7887 E. Belleview, Suite 1114
Englewood, CO 80111

William Rubin                                 (4) 183,670    2.2%
313 East Fort Ave.
Baltimore, MD 21230

Cindy Jones                                             0      0%
7887 E. Belleview, Suite 1114
Englewood, CO 80111

Nick Catalano                                 (3)  23,050     .3%
189-32 44th Avenue
Flushing, NY  11358

Dr. Theodore Jacobs
1999 Broadway, Suite 3135                     (3) 138,859    1.6%
Denver, CO  80202

Officers and Directors                            206,008    2.4%
as a Group (2 persons)
</TABLE>

(1) Include shares owned by Nannette Goldberg, wife of A.B. Goldberg 
Director of Company and shares owned by his mother and his two 
children.  There are no stock options issued or outstanding to  A. 
B. Goldberg.

(2) Includes shares owned by Doug Olson, president and sole 
shareholder of Creative Business Services.

(3) Form 4 and 5 required to be filed for changes in beneficial 
ownership have not been timely filed by these directors who have 
resigned August, 1998.

(4) Includes 6,347 shares of Class B convertible preferred stock 
convertible into 79,337 shares of common stock.

Item 12. Certain Relationships and Related Transactions

In April 1996, the Company acquired the office building and land 
which houses its radio station and the land occupied by its radio 
tower for $425,000 from a trust controlled by a former officer of 
the Company.  The Company issued 275,000 shares of Class C Preferred 
Stock valued at $275,000 and a mortgage note in the amount of 
$150,000.  In 1996, Class C Preferred Stock valued at $150,000 was 
converted into 150,000 shares of common stock.  In connection with 
litigation settlement, the remaining preferred stock valued at 
$125,000 was returned to the Company in exchange for a mortgage note 
of $125,000.

Commencing April 1995, the Company contracted out some 
administrative, management and accounting functions of the Company 
to a company wholly owned by the former president and director of 
the Company.  Monthly fees for such services for 1997 and 1996 were 
$21,000 and $20,000 respectively.  Total annual fees paid for 1997 
and 1996 were $252,000 and $240,000.  The affiliated company sub-
leases office space from the Company on a month-to-month lease for 
$500 per month.  In addition, in 1996, the Company accrued a stock 
bonus of $168,000 due to the service company payable in common stock 
which was issued in February 1997.  The stock bonus award was based 
on recognition of prior services provided to the Company. 

In July 1997, the Company acquired 100,000 shares of common stock of 
ASOTV from NMG, LLC, an entity owned by the wife of the president, 
in exchange for 100,000 shares of common stock of the Company.  The 
value of the common stock issued to NMG, LLC, $50,000, has been 
classified as officer compensation in the accompanying consolidated 
statements of operations.

Consulting fees were paid to the wife of the President for the years 
ended December 31, 1997 and 1996 in the amount of $5,500 and $12,000 
respectively.  The amounts paid to the wife of the President have 
been classified under officer compensation in the accompanying 
consolidated statements of operations. 


PART IV

Item 13. Exhibits and Reports on Form 8-K

 (a) Exhibits.  The following exhibits are filed herewith pursuant 
to Rule 601 of Regulation S-K or are incorporated by reference to 
previous filings.  

Exhibit  
Table No                                  Document         Reference
 2) Plan of acquisition, reorganization,
    arrangement, liquidation,                        None
    or succession

	(3) Articles of Incorporation and Bylaws            (A)

(4) Instruments defining the rights of security holders, including 
(B) indentures

	(9) Voting trust agreement                                None

	(10) Material contracts                                    (C)

	(13) Annual or quarterly reports, Form 10-QSB             None

	(16) Letter on change in certifying accountant             (F)

	(18) Letter on change in accounting principles            None

	(21) Subsidiaries of the registrant                        (D)

	(22) Published report regarding matters submitted
 to a vote of security holders                            None

 (23) Consent of experts and counsel                      (E)

	(24) Power of attorney                                   None

	(27) Financial Data Schedule                              (6)

	(28) Information from reports furnished to state insurance  None
     regulatory authorities

(99) Additional exhibits                                 None

(A)	A complete copy of the Company's Articles of Incorporation as 
currently in effect and all amendments thereto was filed as Exhibit 
89.3.1 to the Registrant' Form 10-K for the fiscal year ended December 
31, 1989, and a complete copy of the Company's Bylaws as currently in 
effect was filed as Exhibit 86-3(c) to the Company's Registration 
Statement on Form S-18 (Registration No. 33-9163-D) and are 
incorporated herein by reference thereto.  

(B)	The Company hereby agrees to furnish a copy of the form of its 
convertible subordinated debentures to the Commission upon request.  

(C)	The following material contracts are filed herewith or incorporated 
herein by reference thereto:  

Document Title               Reference             Commission Filing
 Stock Option Agreement     86-10(a)             Registration Statement
  on Robert Beattie                            on Form S-18 (33-9163-D)

 Host Agreement - Annette Funnicello 86-10(b)   	Registration Statement
                                               on Form S-18 (33-9163-D)

 Host Agreement - Jill St. John   86-10(c)      	Registration Statement
                                               on Form S-18 (33-9163-D)

 Host Agreement - James Farentino   86-10(d)    	Registration Statement
                                               on Form S-18 (33-9163-D)

 Host Agreement - Tony Randall      86-10(e)	    Registration Statement
                                               on Form S-18 (33-9163-D)

 Video Distribution Agreement -     86-10(f)    	Registration Statement
  Lightning Video (Vestron)                    on Form S-18 (33-9163-D)

 Trademark License Agreement -      86-10(g)    	Registration Statement
  Rand McNally & Company                       on Form S-18 (33-9163-D)

 Stock Option Agreement           86-10(h)       Registration Statement
  Peter TenEyck                                on Form S-18 (33-9163-D)

 November 4, 1987 amendment to     87-10(a)      	Registration Statement
  Vestron Distribution Agreements              on Form S-18 (33-9163-D)

 January 29, 1988 amendment to     87-10(b)      	Registration Statement
  Trademark License Agreement                  on Form S-18 (33-9163-D)

 Selluloid Agreement dated March 4, 1988 87-10(d)Registration Statement
                                               on Form S-18 (33-9163-D)

 Children as Teachers of Peach     87-10(e)	      Registration Statement
  Agreement dated June 6, 1988                 on Form S-18 (33-9163-D)

 Eastman's Outdoor World and Western  87-10(f)   	Registration Statement
  American Films, Inc. dated March 17, 1988    on Form S-18 (33-9163-D)

 Sturgis Exclusive Licensing and Use  87-10(g)   	Registration Statement
  Agreement dated July 1987                    on Form S-18 (33-9163-D)

 Best Film and Video Corporation      87-10(h)   	Registration Statement
  Distribution Agreement dated December        on Form S-18 (33-9163-D)
   7, 1987

 Gillette,Wyoming Office Lease Agreement 87-10(i)Registration Statement
                                               on Form S-18 (33-9163-D)

 KGWY-FM Tower Lease         87-10(j)           Registration Statement
                                              on Form S-18 (33-9163-D)
 December 15, 1988 Atlantis Video  89-10(a)     	Form 10-K for the year
  License Agreement                            ended December 31, 1988

 Iowa Radio Stations Asset Purchase   89-10(b  )	Form 10-K for the year
  Agreement dated April 18, 1989              ended December 31, 1988

 January 31, 1989 License Agreement with 89-10(c)	Form 10-K for the year
  Adler Video Marketing, Ltd.                   ended December 31, 1988

 Stock Option Agreement - Ray Ricci   89.10.1   	Form 10-K for the year
                                                ended December 31, 1989

 Stock Option Agreement - Ray Ricci   89.10.2	   Form 10-K for the year
                                                ended December 31, 1989

 Stock Option Agreement - Keller, Wing, 89.10.3 	Form 10-K for the year
  Godbolt and Polakovic                        ended December 31, 1989

 Stock Option Agreement - Dennis Dowd  89.10.4	  Form 10-K for the year
                                               ended December 31, 1989

 Rand McNally Video Trip Guide to Ohio  89.10.5	  Form 10-K for the year
  Agreement, dated January 11, 1990             ended December 31, 1989

 Wyoming Radio Station Letter of Intent  89.10.6	 Form 10-K for the year
  dated March 28, 1990                          ended December 31, 1989

 Settlement Agreement with Miller &     89.10.7  	Form 10-K for the year
  Weiss, P.C., dated March 30, 1990             ended December 31, 1989

 Distributor Agreement with Adler Video  89.10.8 	Form 10-K for the year
  Marketing, Ltd.                               ended December 31, 1989

 Post-Production Services Agreement     93-10.1  Form 10-K for the year 
                                                ended December 31, 1993

 Settlement Agreement with DCC and      93.10.2  	Form 10-K for the year
  Marshall Blonstein                           ended December 31, 1993

 Agreement with Rand McNally and Company 93.10.3	Form 10-K for the year
                                               ended December 31, 1993

 Promissory note with Keller, Wing & Godbolt 93.10.4 Form 10-K for the
                                           year ended December 31, 1993

 Distribution/licensing agreement with   93.10.5 	Form 10-K for the year
  Woodknapp and Company                        ended December 31, 1993

 Amendment to Articles of Incorporation  93.10.6 	Form 10-K for the year
  Name change                                   ended December 31, 1993

 Amendment to Articles of Incorporation  93.10.7 	Form 10-K for the year
  increase authorized shares                    ended December 31, 1993

 Stock Option Agreement   Robert Young   93.10.8 	Form 10-K for the year
                                                ended December 31, 1993

 Letter of Intent   Polton Corporation   93.10.9 	Form 10-K for the year
                                                ended December 31, 1993

 Promissory note   sample   bridge lenders 93.10.10 Form 10-K for the
                                          year ended December 31, 1993

 Subscription Agreement        93.10.11         Form 10-K for the year
                                               ended December 31, 1993

(D) Not required since the information is ascertainable from the 
Company's financial statements filed herewith.  

(E) A list of all subsidiaries of the Company was filed as Exhibit 89-
22(a) to the Company's Form 10-K for the year ended December 31, 
1988 and is incorporated herein by reference thereto.  

 (b) Reports on Form 8-K
     One report on Form 8-K was filed by the Registrant during the last 
quarter of the period covered by this report.  

     Form 8-K dated December 10, 1997; Item 1, 2, 5 and 7.

SIGNATURES

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


                                       FIRST ENTERTAINMENT HOLDING CORP


Dated: December 1 , 1998              By	       ________________
                                       A. B. Goldberg, President

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


Dated:	December 1 , 1998             __________
                                    A. B. Goldberg
                                    President and Principal Executive  
                                    Officer


Dated: December 1 , 1998           _________________________
                                    Cynthia M. Jones
                                    Secretary and Treasurer
                                    Principal Accounting Officer

Dated: December 1 , 1998           _________________________
                                    William Rubin
                                      Director