x
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QUARTERLY
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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o
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TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
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Delaware
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20-2650200
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(State
or other jurisdiction of
incorporation
or organization)
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(I.R.S.
Employer Identification No.)
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360
Madison Avenue, 21st
Floor
New
York, New York
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10017
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(Address
of principal executive
offices)
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(Zip
Code)
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PART I
- FINANCIAL INFORMATION
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Item
1. Financial Statements
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Balance
Sheets
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Statements
of Operations
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Statement
of Cash Flows
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Notes
to Consolidated Financial Statements
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Item
2. Management’s Discussion and Analysis of Financial Condition and Results
of Operations
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Item
3. Quantitative and Qualitative Disclosures about Market
Risk
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Item
4. Controls and Procedures
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PART II
- OTHER INFORMATION
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Item
1. Legal Proceedings
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Item
2. Unregistered Sales of Equity Securities and Use of
Proceeds
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Item
3. Defaults Upon Senior Securities
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Item
4. Submission of Matters to a Vote of Security
Holders
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Item
5. Other Information
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Item
6. Exhibits
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SIGNATURES
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December
31, 2006
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March
31, 2006 (As Restated)
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||||||
ASSETS
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|||||||
Current
assets:
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|||||||
Cash
and cash equivalents
|
$
|
5,879
|
$
|
579,029
|
|||
Prepaid
expenses
|
12,692
|
72,488
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|||||
Total
current assets
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$
|
18,571
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$
|
651,517
|
|||
Investments
held in Trust Account
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52,247,606
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51,108,343
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|||||
Fixed
assets, net of accumulated depreciation
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3,300
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4,062
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|||||
Total
assets
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$
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52,269,477
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$
|
51,763,922
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|||
LIABILITIES
AND STOCKHOLDERS’ EQUITY
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|||||||
Current
liabilities:
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|||||||
Accrued
expenses
|
$
|
69,350
|
$
|
90,310
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|||
Taxes
payable
|
25,500
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116,000
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|||||
Derivative
liabilities
|
4,659,138
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13,393,035
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|||||
Notes
payable to Stockholders
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30,000
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-
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|||||
Total
current liabilities
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$
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4,783,988
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$
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13,599,345
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|||
Common
stock, and changes in Trust Account value attributable to shares
subject
to possible redemption, 1,799,100 shares at $5.60 per
share
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10,460,507
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10,193,318
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|||||
STOCKHOLDERS’
EQUITY
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|||||||
Preferred
stock — $0.0001 par value, 1,000,000 shares authorized; 0 shares issued
and outstanding
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0
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0
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|||||
Common
stock — $0.0001 par value, 50,000,000 shares authorized; 11,249,997 shares
issued and outstanding (which includes 1,799,100 shares subject to
possible redemption)
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1,125
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1,125
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|||||
Additional
paid-in capital
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32,343,046
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32,343,046
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|||||
Retained
earnings (deficit)
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4,680,811
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(4,372,912
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)
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||||
Total
stockholders’ equity
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37,024,982
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27,971,259
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|||||
Total
liabilities and stockholders’ equity
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$
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52,269,477
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$
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51,763,922
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Three
Months Ended
December
31, 2006
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Three
Months Ended
December
31, 2005
(As
Restated)
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Nine
Months Ended
December
31, 2006
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April
7, 2005 (Date of Inception) Through
December
31, 2005
(As
Restated)
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April
7, 2005 (Date of Inception) Through
December
31, 2006
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||||||||||||
Operating
costs
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$
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(120,469
|
)
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$
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(71,182
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)
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$
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(388,162
|
)
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$
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(92,381
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)
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(604,255
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)
|
||
Loss
from operations
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(120,469
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)
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(71,182
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)
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(388,162
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)
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(92,381
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)
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(604,255
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)
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||||||
Gain
(loss) from derivative liabilities
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3,255,749
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(431,280
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)
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8,733,896
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173,219
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4,071,333
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||||||||||
Interest
income, net
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412,858
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405,275
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1,204,433
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405,349
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1,944,535
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|||||||||||
Income
before provision for income taxes
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3,548,138
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(97,187
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)
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9,550,167
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486,187
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5,411,613
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||||||||||
Provision
for income taxes
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(100,255
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)
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-
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(229,255
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)
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-
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(345,255
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)
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||||||||
Net
income (loss)
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$
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3,447,883
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$
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(97,187
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)
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$
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9,320,912
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$
|
486,187
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$
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5,066,358
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|||||
Weighted
average shares outstanding—basic
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11,249,997
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11,249,997
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11,249,997
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6,475,188
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||||||||||||
Net
income (loss) per share—basic
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$
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0.31
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$
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(0.01
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)
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$
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0.83
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$
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0.08
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|||||||
Weighted
average shares outstanding—diluted
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13,024,035
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11,249,997
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12,902,873
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6,928,363
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||||||||||||
Net
income per share—diluted
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$
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0.03
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$
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(0.01
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)
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$
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0.09
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$
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0.06
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|||||||
Pro
Forma Adjustment:
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||||||||||||||||
Interest
income attributable to common stock subject to possible
redemption
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$
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(82,495
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)
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$
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(81,029
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)
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$
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(267,189
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)
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$
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(81,029
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)
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||||
Pro
forma net income (loss) attributable to common stockholders not subject
to
possible redemption
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$
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3,365,388
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$
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(178,216
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)
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$
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9,053,723
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$
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405,158
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|||||||
Pro
forma weighted average number of shares outstanding, excluding shares
subject to possible redemption—basic
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9,450,897
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9,450,897
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9,450,897
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5,630,572
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||||||||||||
Pro
forma net income (loss) per share, excluding shares subject to possible
redemption—basic
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$
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0.36
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$
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(0.02
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)
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$
|
0.96
|
$
|
0.07
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|||||||
Pro
forma weighted average number of shares outstanding, excluding shares
subject to possible redemption—diluted
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11,224,935
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9,450,897
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11,103,773
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6,083,747
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||||||||||||
Pro
forma net income (loss) per share, excluding shares subject to possible
redemption—diluted
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$
|
0.03
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$
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(0.02
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)
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$
|
0.09
|
$
|
0.06
|
Nine
Months Ended
December
31, 2006
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April
7, 2005 (Date of Inception) Through
December
31, 2005 (As Restated)
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April
7, 2005 (Date of Inception) Through December 31,
2006
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||||||||
Cash
flows from operating activities:
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||||||||||
Net
income
|
$
|
9,320,912
|
$
|
486,187
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$
|
5,066,358
|
||||
Adjustments
to reconcile net income to net cash provided by operations:
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||||||||||
Depreciation
|
762
|
761
|
1,777
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|||||||
Gain/loss
from change in value of derivative liabilities
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(8,733,896
|
)
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(173,219
|
)
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(4,071,333
|
)
|
||||
Changes
in operating assets and liabilities
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||||||||||
Prepaid
expenses
|
59,796
|
(90,809
|
)
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(12,692
|
)
|
|||||
Accrued
expenses
|
(20,960
|
)
|
26,623
|
69,350
|
||||||
Taxes
payable
|
(90,500
|
)
|
-
|
25,500
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||||||
Net
cash provided by operating activities
|
536,114
|
249,543
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1,078,960
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|||||||
Investing
activities:
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||||||||||
Cash
held in Trust Account
|
(1,139,264
|
)
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(50,779,664
|
)
|
(52,247,607
|
)
|
||||
Purchases
of property and equipment
|
-
|
(5,077
|
)
|
(5,077
|
)
|
|||||
Net
cash used in investing activities
|
(1,139,264
|
)
|
(50,784,741
|
)
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(52,252,684
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)
|
||||
Cash
flows from financing activities:
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||||||||||
Issuance
of stock
|
-
|
51,148,503
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51,148,503
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|||||||
Proceeds
from sale of common stock to founders
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-
|
1,000
|
1000
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|||||||
Proceeds
from issuance of representative’s option
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-
|
100
|
100
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|||||||
Proceeds
from notes payable to stockholder
|
30,000
|
150,000
|
180,000
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|||||||
Repayment
of notes payable to stockholders
|
-
|
(150,000
|
)
|
(150,000
|
)
|
|||||
Net
cash provided by financing activities
|
30,000
|
51,149,603
|
51,179,603
|
|||||||
Net
increase in cash
|
(573,150
|
)
|
614,405
|
5,879
|
||||||
Cash,
beginning of period
|
579,029
|
-
|
-
|
|||||||
Cash,
end of period
|
$
|
5,879
|
$
|
614,405
|
$
|
5,879
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[1] |
Cash
and cash equivalents:
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[2] |
Investments
held in Trust Account:
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[3] |
Accounting
for Warrants and Derivative
Instruments
|
[4] |
Earnings
per common share:
|
[5] |
Use
of estimates:
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[6] |
Income
taxes:
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31.1
|
Section 302
Certification of Chief Executive Officer
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31.2
|
Section 302
Certification of Chief Financial Officer
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32.1
|
Section 906
Certification
|
AD.VENTURE
PARTNERS, INC.
|
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Date:
February 14, 2007
|
By: | /s/ Howard S. Balter |
Howard S. Balter |
||
Chairman
and Chief Executive
Officer
(Principal Executive Officer)
|
|
|
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By: | /s/ Ilan M. Slasky | |
Ilan M. Slasky |
||
President
and Secretary (Principal Financial and Accounting
Officer)
|