Table of Contents





UNITED
STATES
 SECURITIES
AND EXCHANGE COMMISSION
 Washington,
D.C. 20549
 
 FORM
10-K
 
 ý Annual Report Pursuant
to Section 13 or 15(d)
 of
the Securities Exchange Act of 1934
 
 For
the fiscal year ended December 31, 2008
 
 o Transition Report
Pursuant to Section 13 or 15(d) of the
 Securities
Exchange Act of 1934
 
 For
the transition period from
                
to
 
 Commission
file number 000-51510
 
 INTERAMERICAN
ACQUISITION GROUP INC.
 (Exact
name of registrant as specified in its charter)
 
 Delaware
                
                20-2828369(State
      or other jurisdiction of
                
                (I.R.S.
      Employerincorporation
      or organization)
                
                Identification
      No.)2918
      Fifth Avenue South, Suite 209
                  San
      Diego, California
                
                92103(Address
      of principal executive office)
                
                (Zip
      Code)
 
  Registrant’s
telephone number, including area code: (619)
298-9883
 
 Securities
of the Registrant registered pursuant to Section 12(b) of the Act: None
 
 Securities
of the Registrant registered pursuant to Section 12(g) of the Act:
 
 Title of
each class
 
 Common
Stock, par value $.0001 per share
 Warrants
 Units
 
 Indicate by check mark if the
registrant is a well-known seasoned issuer, as defined in Rule 405 of the
Securities Act.
 Yeso Noý
 
 Table of Contents
 Indicated
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act.
 Yes oNo ý
 
 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 ýNo
o
 
 Indicate by check mark if disclosure of
delinquent filers pursuant to Item 405 of Regulation S-K is not contained
herein, and will not be contained, to the best of the registrant’s knowledge, in
definitive proxy or information statements incorporated by reference in Part III
of this Form 10-K or any amendment to this Form 10-K.
 Yes oNo ý
 
 Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting
company.  See the definitions of “large accelerated filer,”
“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act.
  Large
accelerated filer o                                                                                                   Accelerated
filer o
  Non-accelerated
filer o                                                                                                     Smaller
Reporting Companyý
  Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Act).
 Yes ýNo
o
 
 The aggregate market value of the
registrant's voting common equity held by non-affiliates of the registrant on
the last business day of the registrant’s most recently completed second fiscal
quarter, computed by reference to the last sale price of such stock of $7.83 per
share as of June 30, 2008, was approximately $45.0 million. The registrant has
no non-voting common equity issued and outstanding.  The determination of
affiliate status for purposes of this paragraph is not necessarily a conclusive
determination for any other purpose.
 
 The
number of shares outstanding of the registrant's common stock as of March 31,
2009 was 7,000,000 shares.
 
 DOCUMENTS
INCORPORATED BY REFERENCE
 
 None.
 
 
 TABLEOF CONTENTS
   Item 1:
                                            Business
                                            5Item 1A:
                                            Risk Factors
                                            12Item 1B:
                                            Unresolved Staff Comments
                                            24Item 2:
                                            Properties
                                            24Item 3:
                                            Legal Proceedings
                                            25Item 4:
                                            Submission of Matters to a vote of Security
      Holders
                                            25Item 5:
                                            Market for Registrant’s Common Equity, Related Stockholder
      Matters and Issuer Purchases of Equity
    Securities
                                            26Item 6:
                                            Selected Financial Data
                                            27Item 7:
                                            Management’s Discussion and Analysis of Financial Condition
      and
      Results of Operations
                                            27Item 7A:
                                            Quantitative and Qualitative Disclosures About Market
      Risk
                                            30Item 8:
                                            Financial Statements and Supplementary
    Data
                                            30Item 9:
                                            Changes in and Disagreements with Accountants on Accounting
      and Financial Disclosure
                                            30Item 9A:
                                            Controls and Procedures
                                            30Item 9B:
                                            Other Information
                                            31Item 10:
                                            Directors and Executive Officers of the
      Company
                                            32Item 11:
                                            Executive Compensation
                                            37Item 12:
                                            Security Ownership of Certain Beneficial Owners and Management
      and Related Stockholder Matters
                                            39Item 13:
                                            Certain Relationships and Related
      Transactions
                                            41Item 14:
                                            Principal Accountant Fees and Services
                                            44Item 15:
                                            Exhibits and Financial Statement
    Schedules
                                            45
 
 Table of Contents
 
 CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
 
 This
Annual Report on Form 10-K includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities Exchange Act of 1934, as amended. These forward-looking
statements can be identified by the use of forward-looking terminology,
including the words “believes, “estimates, “anticipates, “expects, “intends,”
“plans,” “may,” “will,” “potential,” “projects,” “predicts, “continue,” or
“should,” or, in each case, their negative or other variations or comparable
terminology. Such statements include, but are not limited to, any statements
relating to our ability to consummate any acquisition or other business
combination and any other statements that are not statements of current or
historical facts. These statements are based on management’s current
expectations, but actual results may differ materially due to various factors,
including, but not limited to, our:
 
 •
              being
      a development stage company with no operating
  history;
 
 •
              dependence
      on key personnel, some of whom may not join us following an initial
      transaction;
 
 •
              personnel
      allocating their time to other businesses andpotentially having
      conflicts of interest with our
business;
 
 •
              potentially
      being unable to obtain additional financing to complete an initial
      transaction;
 
 •
              limited
      pool of prospective target
businesses;
 
 •
              securities’
      ownership being concentrated;
 
 •
              potential
      change in control if we acquire one or more target businesses for
      stock;
 
 •
              risk
      associated with operating in the services or manufacturing sector or in a
      foreign jurisdiction;
 
 •
              financial
      performance following an initial transaction;
or
 
 •
              those
      other risks and uncertainties detailed in the Registrant’s filings with
      the Securities and Exchange
Commission.
 
 By
their nature, forward-looking statements involve risks and uncertainties because
they relate to events and depend on circumstances that may or may not occur in
the future. We caution you that forward-looking statements are not guarantees of
future performance and that our actual results of operations, financial
condition and liquidity, and developments in the industry sectors in which we
are actually operate following a business combination may differ materially from
those made in or suggested by the forward-looking statements contained in this
Annual Report on Form 10-K. In addition, even ifour
results or operations, financial condition and liquidity, and developments in
the industry in which we operate are consistent with the forward-looking
statements contained in this Annual Report on Form 10-K,those results or developments
may not be indicative of results or developments in subsequent
periods.
 
 These
forward-looking statements are subject to numerous risks, uncertainties and
assumptions about us described in our filings with the Securities and Exchange
Commission. The forward-looking events we discuss in this Annual Report on Form
10-K speak only as of the date of such statement and might not occur in light of
these risks, uncertainties and assumptions. Except as required by applicable
law, we undertake no obligation and disclaim any obligation to publicly update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
 
 Unless
otherwise provided in this Annual Report on Form 10-K, references to “the
Company,” “the Registrant,” “we,” “us” and “our” refer to InterAmerican
Acquisition Group, Inc.
  Table of Contents
 PART
I
  Item1. Business.
 
 Introduction
 
 InterAmericanAcquisition Group, Inc.
(the “Company”, “we”, or “us”) is a blank check company organized under the laws
of the State of Delaware on May 10, 2005. We were formed to acquire, through a
merger, capital stock exchange, asset acquisition or other similar business
combination, one or more domestic or international assets or an operating
business. To date, our efforts have been limited to organizational activities,
our initial public offering and the search for a suitable business combination.
We are not presently engaged in any substantive commercial business. Our
activities since the consummation of our initial public offering have been
solely to identify a prospective target business and were not limited to a
particular industry or country. As of the date of this filing, we have not
acquired any business operations, but, as further described below, we have
entered into a definitive agreement to acquire Sing Kung Limited.
 
 Our
executive offices are located at 2918 Fifth Ave., Suite 209, San Diego, CA 92103
and our telephone number at that location is (619) 298-9883.
 
 Recent
Developments
 
 The
registration statement for our initial public offering (the “Offering”) was
declared effective on September 4, 2007. The Company completed the Offering,
including the exercise of the underwriter’s overallotment option, on September
10, 2007 and September 11, 2007, selling 5,750,000 units (“Units”) at a price of
$8.00 per Unit. Each Unit consists of one share of the Company’s common stock,
$.0001 par value, and one redeemable common stock purchase warrant (“Warrants”).
Each Warrant entitles the holder to purchase from the Company one share of
common stock at an exercise price of $5.00 commencing on the later of the
completion of a business combination and one year from the effective date of the
Offering and expiring four years from the effective date of the Offering. The
Company may redeem the Warrants at a price of $0.01 per Warrant upon 30 days
notice after the Warrants become exercisable, only in the event that the last
sale price of the common stock is at least $10.00 per share for any 20 trading
days within a 30-day period ending on the third day prior to the date on which
notice of redemption is given. In addition, the Company also consummated a
private placement of 1,000,000 warrants at $1.50 per warrant to an entity
affiliated with its management team and one of the Company’s special advisors
(the “Warrant Purchase”). We received gross proceeds of $46,000,000 from the
Offering (including the exercise of the underwriters’ overallotment option) and
$1,500,000 from the Warrant Purchase, of which $45,160,000 was placed in
trust.
 
 On
September 5, 2007, our units commenced trading on the OTC:BB under the symbol
“IAQGU”. Holders of the Company’s units were able to separately trade the common
stock and warrants included in such units commencing September 20, 2007 and the
trading in the units has continued under the symbol IAQGU. The common stock and
warrants are quoted on the OTC:BB under the symbols IAQG and IAQGW,
respectively.
 
 Since the
completion of the Offering, we were engaged in the search for a suitable
business combination until we entered into a stock purchase agreement with Sing
Kung Limited, a privately-held company based in the British Virgin Islands
(“Sing Kung”), with operations in the People’s Republic of China (“PRC”),
effective as of May 15, 2008 and amended on November 28, 2008. The proposed
transaction is described below. Subsequent to the effective date of the stock
purchase agreement, we have been conducting activities pertinent to the
prospective transaction and preparing a proxy statement/prospectus on Form S-4
as required to obtain the vote of our stockholders. Our proxy
statement/prospectus on Form S-4, as amended, was initially filed with the
Securities and Exchange Commission (the “SEC”) on August 12, 2008 and the most
recent amendment was filed on December 18, 2008.
 
 On May
21, 2008, the Company issued to certain of its founding stockholders and one of
its special advisors, warrants to purchase an aggregate of 185,000 shares of its
common stock, pursuant to agreements dated as of May 21, 2008, an amount that
will be reduced to 55,850 shares to comply with Amendment No.1 to the stock
purchase agreement. A copy of the form of agreement with such founding
stockholders was filed on a Current Report on Form 8-K on May 23, 2008. As a
result of the issuance of the warrants, if such warrants are exercised, the
founding stockholders would have an 18.5% beneficial ownership interest in the
Company after giving effect to the warrant reduction required by the stock
purchase agreement, as amended, and before giving effect to the exercise of the
private placement warrants purchased at the time of the Offering. Under the
terms of the May 21, 2008 warrant agreements, the warrants are immediately
exercisable at an exercise price of $.01 and expire on the earlier of (x)
January 31, 2009 if a business combination is consummated in 2008 or 90 days
after the consummation of a business combination if such business combination
occurs in 2009 or (y) September 4, 2009. The holders of such warrants are
restricted from selling or transferring the warrants, or any common stock
underlying such warrants, to any transferee until September 4, 2009. During such
restricted period, no sale or transfer or other disposition of the warrants, or
any common stock underlying such warrants, can be made except for certain
limited exceptions as set forth in the warrant agreements. The issuance of the
warrants on May 21, 2008 was made pursuant to the exemption from the
registration provisions of the Securities Act of 1933, as amended (the
“Securities Act”), provided by Section 4(2) of the Securities Act and Regulation
D promulgated thereunder. The warrants and underlying common stock have not been
registered under the Securities Act and may not be offered or sold in the United
States absent registration or an applicable exemption from registration
requirements.
 
 5
 Table of Contents
 On August
11, 2008, the Company formed CNC Development Ltd. (“CNC”) in the British Virgin
Islands as a wholly-owned subsidiary of the Company in accordance with the
unanimous written resolution of its board of directors and the terms of the
stock purchase agreement with Sing Kung. CNC currently has no operations or
assets.
 
 Our
Management Team
 
 Our
management team has extensive experience making acquisitions and in guiding
businesses operating in emerging markets. William C. Morro, our Chairman, Chief
Executive Officer and Chief Financial Officer has participated as an investment
principal in 55 acquisition or divestiture transactions since 1991. He led
investment business units for Heller Financial Inc. and the Bank of Montreal
Group of Companies before becoming a principal in the InterAmerican Group and a
founder of the Company. Dr. Richard N. Sinkin, our Chief Operating Officer and
Secretary, is also a Partner of the InterAmerican Group and founded its
predecessor entities. InterAmerican Group specializes in providing international
business consulting services to companies and institutions seeking to establish
a marketing or manufacturing presence in emerging markets, with particular
emphasis on Latin America.He is a specialist in
setting up offshore business operations, particularly in Mexico, where he has
directed the start-up of 27 factories.Prior to forming
InterAmerican, Dr. Sinkin was the vice president of the Institute of the
Americas in La Jolla, California and he continues to serve organizations that
are deeply involved with business development in emerging markets, including as
an elected member of the Council on Foreign Relations in New York.
 
 Sourcing
the Sing Kung transaction
 
 Target
businesses were brought to our attention from various unaffiliated sources,
including investment bankers, venture capital funds, private equity funds,
leveraged buyout funds, management buyout funds and other members of the
financial community. Our officers, directors and special advisors as well as
their affiliates also brought to our attention target business candidates that
they became aware of through their business contacts. Although we gave
particular attention to the potential of a target business to expand its
operating scope in Mexico/Latin America, we determined that the acquisition of
Sing Kung was in the best interests of our stockholders. We negotiated a stock
purchase agreement with a majority of Sing Kung’s stockholders effective May 15,
2008, and an amendment thereto effective November 28, 2008. We did not engage
any party to whom we owe a finder’s fee or other compensation and we did not pay
nor will we be obligated to pay any of our existing officers, directors, special
advisors or stockholders or any entity with which they are affiliated any
finder’s fee for services rendered to us prior to, in connection with or
following the consummation of a business combination. In addition, we have not
paid and will not pay any of our existing officers, directors, special advisors
or stockholders or any entity with which they are affiliated any consulting fees
or other similar compensation other than the $120,000 administrative fee to
InterAmerican Advisors, LLC, and reimbursable out-of-pocket
expenses.
 
 Although
our management has and continues to endeavor to evaluate the risks inherent in
the Sing Kung transaction, we cannot assure you that we will properly ascertain
or assess all significant risk factors.
 
 Overview
of Sing Kung’s business
 
 Sing
Kung, through its Chinese operating subsidiaries, Century City Infrastructure
Co., Ltd. (“Century City”) and Shanghai New Century City Development, Ltd.
(“SNC”), provides comprehensive strategic planning services and further partners
with various specialist firms to deliver detailed urban plans, infrastructure
development, urban land improvement, and older-city redevelopment to municipal
governments in China. In this way, Sing Kung delivers turnkey solutions to
municipalities seeking to implement new development zones, expand existing
developments, or redevelop underutilized urban resources and thereby stimulate
supplemental direct investment. Sing Kung’s planning and infrastructure projects
encompass sites targeted by municipalities for industrial, commercial, and
residential developments. The range of services provided is tailored for the
specific needs of its clients, selected from a universe of roughly 5,300 local
government entities with limited economic strength but development resources
offering strong economic potential. These could include: newly-formed
municipalities; mid-sized cities and counties; or established larger urban areas
and special development zones that must react quickly but strategically to keep
up with urbanization pressures. Generally, Sing Kung first provides its clients
with an economic development and land resource management strategy, followed by
detailed development plans and fully-financed infrastructure implementation.
Sing Kung also offers municipal government leaders support in obtaining
long-term replacement financing and later-phase commercialization and project
marketing.
  6
 Table of Contents
 Summary
of the Sing Kung transaction
 
 Effective
May 15, 2008, the Company became party to a definitive stock purchase agreement
to acquire 89.6% of the fully-diluted shares of Sing Kung. Pursuant to the stock
purchase agreement, as amended, the Company formed a subsidiary, CNC in the
British Virgin Islands on August 11, 2008. Upon the closing of the acquisition,
subject to the approval of the Company’s stockholders, the stock purchase
agreement calls for the simultaneous redomestication of the Company from the
State of Delaware to the British Virgin Islands, through a merger of the Company
into CNC. The Sing Kung stockholders that are party to the stock purchase
agreement will receive in the aggregate (i) 19,843,417 shares of CNC common
stock plus(ii) the
right to receive an additional 12.4 million shares if the following net income
targets are met in each of the years shown below:
  Year
      ending December 31,
                          
                          Net
      Income2009
                          
                          $
                          56,000,0002010
                          
                          $
                          80,000,0002011
                          
                          $
                          112,000,0002012
                          
                          $
                          151,200,000
 
 CNC also
intends to make an exchange offer of 1,076,070 shares of CNC common stock for
the remaining 2,548,719 common shares of Sing Kung and 2,685,774 shares of CNC
common stock for the 2,915,000 shares of preferred shares of Sing Kung that are
held by Sing Kung stockholders who are not parties to the stock purchase
agreement. The acquisition is expected to be consummated in the second quarter
of 2009, after the required approval by the Company’s stockholders and the
fulfillment of certain other closing conditions. Following the closing of the
transaction, the post-transaction public company will be renamed China New
Cities Development Ltd. In addition, the Company will seek to list its shares on
The NASDAQ Stock Market prior to the completion of the acquisition.
 
 Prior to
the closing of the acquisition, the amended stock purchase agreement requires us
to reduce the number of the Company’s common shares outstanding (including the
management warrants issued on May 21, 2008 and described above) to a total of
7,055,850. To satisfy this condition, our board of directors has authorized, and
the holders of the management warrants have agreed, to a rescission of 129,150
of the management warrants prior to the closing of the Sing Kung
transaction.
 
 Working
capital requirements to complete the acquisition
 
 Our
management has not had experience completing an acquisition on behalf of a blank
check company and the time and costs required to select and evaluate a target
business and to structure and complete the business combination cannot presently
be ascertained with any degree of certainty. Nevertheless, as further discussed
below in Item 7 under the heading “CHANGES IN FINANCIAL CONDITION – Liquidity
and capital resources”, we have exhausted our available working capital in our
efforts to complete the Sing Kung transaction. If we are unable to consummate
the Sing Kung transaction, we most likely will not have the resources to pursue
an alternative business combination and we will have to liquidate. All costs
incurred with respect to the identification and evaluation of a prospective
target business with which a business combination is not ultimately completed
and the costs expended in pursuit of the Sing Kung transaction will result in a
loss to us and reduce the amount of capital available to the combined business
or to our stockholders if we are forced to liquidate. We have not paid and will
not pay any of our existing officers, directors, special advisors or
stockholders or any entity with which they are affiliated any consulting fees or
other similar compensation other than the $120,000 administrative fee to
InterAmerican Advisors, LLC, and reimbursable out-of-pocket
expenses.
 
 Fair
market value of target business
 
 The
initial target business we acquire must have a fair market value equal to at
least 80% of our net assets (excluding any funds held for the benefit of the
underwriters) at the time of such acquisition, including any amount held in the
trust account subject to the redemption rights described below. Provided that
the fair market value of the interest in such business or businesses is at least
equal to 80% of our net assets at the time such acquisition transaction is
consummated, we can also satisfy the requirement that the business combination
have a fair market value at least equal to 80% of our net assets in an
acquisition transaction where we acquire less than a 100% interest in the target
business. This would be the case in the Sing Kung transaction if there is no
participation in the exchange offer by Sing Kung stockholders who are not
parties to the stock purchase agreement. We are not required to obtain an
opinion from an investment banking firm as to the fair market value if our board
of directors independently determines that the target business complies with the
80% threshold. Our board of directors made a determination that the Sing Kung
transaction meets the above-described fair-market-value requirement and
therefore we did not obtain an independent valuation.
 
 7
 Table of Contents
 Lack
of business diversification
 
 Given our
intention to pursue the Sing Kung transaction, we lack the resources to pursue a
second business combination prior to its consummation. Accordingly, the
prospects for our success are entirely dependent our ability to consummate the
Sing Kung transaction and upon the future performance of its business alone. By
consummating a business combination with only a single entity, our lack of
diversification may:
 
 •
                subject
      us to numerous economic, competitive and regulatory developments, any or
      all of which may have a substantial adverse impact upon the particular
      industry in which we may operate subsequent to a business combination;
      and
 •
                result
      in our dependency upon the development or market acceptance of a single or
      limited number of products, processes or
  services.
 
 Limited
ability to evaluate the target business’ management
 
 Although
we attempted to closely scrutinize the management of the acquisition target when
evaluating the desirability of pursuing the Sing Kung transaction, we cannot
assure you that our assessment of Sing Kung’s management will prove to be
correct. In addition, we cannot assure you that the future management will have
the necessary skills, qualifications or abilities to manage a public company.
Furthermore, the future role of our officers and directors in the target
business following a business combination cannot presently be stated with any
certainty. While William C. Morro has agreed to remain associated in a board and
executive capacity following a business combination, subject to reaching a
satisfactory agreement on proposed compensation and responsibilities with the
company’s board of directors following the consummation, there can be no
assurance that he or any other current officers or directors will continue to be
affiliated with the combined company or that they will devote their full
efforts to our affairs subsequent to a business combination. Additionally, our
current officers and directors do not have significant experience or knowledge
relating to the operations of Sing Kung’s business.
 
 Following
a business combination, we may seek to recruit additional managers to supplement
the incumbent management of the target business. We cannot assure you that we
will have the ability to recruit additional managers, or that any such
additional managers we do recruit will have the requisite skills, knowledge or
experience necessary to enhance the incumbent management.
 
 Opportunity
for stockholder approval of business combination
 
 Prior to
the completion of our initial business combination, we will submit the
transaction to our stockholders for approval, even if the nature of the business
combination is such as would not ordinarily require stockholder approval under
applicable state law. In connection with seeking stockholder approval of a
business combination, we will furnish our stockholders with proxy solicitation
materials prepared in accordance with the Securities Exchange Act of 1934, as
amended (the “Exchange Act”) which, among other matters, will include a
description of the operations of the target business and audited historical
financial statements of the business.
 
 In
connection with the vote required for any business combination, all of our
founding stockholders, including all of our officers and directors, have agreed
to vote their respective shares of common stock owned by them immediately prior
to the initial public offering in accordance with the majority of the shares of
common stock voted by the public stockholders. This voting arrangement shall
also apply to shares included in units purchased in the Offering or purchased
following the Offering in the open market by any of our founding stockholders,
officers and directors. Accordingly, they will vote these shares in accordance
with the majority of the shares of common stock voted by the public
stockholders. We will proceed with the business combination only if a majority
of the shares of common stock voted by the public stockholders are voted in
favor of the business combination and public stockholders owning less than 20%
of the shares sold in the initial public offering both exercise their redemption
rights and vote against the business combination.
 
 Redemption
rights
 
 At the
time we seek stockholder approval of any business combination, we will offer
each public stockholder the right to have such stockholder’s shares of common
stock redeemed for cash if the stockholder votes against the business
combination and the business combination is approved and completed. The
redemption rights do not apply to shares outstanding prior to the initial public
offering. The actual per-share redemption price will be equal to the amount in
the trust account, inclusive of any interest (net of taxes payable and interest
earned on the trust account up to a maximum amount of $950,000 that will be
released to us to fund our working capital), calculated as of two business days
prior to the consummation of the proposed business combination, divided by the
number of shares sold in the initial public offering. Without taking into any
account interest earned on the trust account, the initial per-share redemption
price would be $7.85 or $0.15 less than the per-unit offering price of $8.00.
Because the per-share redemption price may be lower than the market price of the
common stock on the date of the redemption, there may be a disincentive on the
part of public stockholders to exercise their redemption rights.
  An
eligible stockholder may request redemption at any time after the mailing to our
stockholders of the proxy statement and prior to the vote taken with respect to
a proposed business combination at a meeting held for that purpose, but the
request will not be granted unless the stockholder votes against the business
combination and the business combination is approved and completed. If a
stockholder votes against the business combination but fails to properly
exercise its redemption rights, such stockholder will not have its shares of
common stock redeemed for its pro rata distribution of the trust account. Any
request for redemption, once made, may be withdrawn at any time up to the date
of the meeting. It is anticipated that the funds to be distributed to
stockholders entitled to redeem their shares who elect redemption will be
distributed promptly after completion of a business combination. Public
stockholders who redeem their stock for their share of the trust account still
have the right to exercise any warrants they still hold.
 8
 Table of Contents
 We will
not complete any business combination if public stockholders, owning 20% or more
of the shares sold in the Offering, exercise their redemption rights. These
redemption provisions, which are contained in our certificate of incorporation,
cannot be amended without the affirmative vote of 95% of the shares sold in the
Offering. We view these provisions as obligations to our investors and neither
we nor our board of directors will propose, or seek stockholder approval
of, any amendment of these provisions. Accordingly, we view it as our obligation
to structure and consummate a business combination in which up to 19.99% of the
public stockholders may exercise their redemption rights and the business
combination will still go forward. We will not seek to increase or decrease this
threshold.
 
 Plan
of dissolution and liquidation if no business combination
 
 Pursuant
to the terms of the trust agreement between us and Continental Stock Transfer
& Trust Company, if we do not complete a business combination within 18
months after the consummation of the Offering, or within 24 months after the
consummation of our initial public is offering if the extension criteria
described below have been satisfied, we will as promptly as practicable in
accordance with the Delaware General Corporation Law dissolve, liquidate and
distribute only to our public stockholders, in proportion to their respective
equity interests, an aggregate sum equal to the amount in the trust account,
inclusive of any interest (net of taxes payable and net of interest earned on
the trust account up to a maximum amount of $950,000 that will be released to us
to fund our working capital), plus any remaining net assets. These liquidation
provisions, which are contained in the investment management trust agreement,
cannot be amended without the affirmative vote of 100% of the public
stockholders. The provisions are also set forth in our certificate of
incorporation, an amendment to which requires the affirmative vote of 95% of the
shares sold in the Offering. We view these provisions as obligations to our
investors and neither we nor our board of directors will propose, or seek
stockholder approval of, any amendment of these provisions. Our founding
stockholders have waived their rights to participate in any liquidation of our
trust account in connection with our dissolution with respect to shares of
common stock owned by them immediately prior to the Offering and to vote their
shares of common stock in favor of any plan of dissolution and distribution
which we will submit to a vote of our stockholders. There will be no
distribution from the trust account with respect to our warrants which will
expire worthless. We will pay the costs of dissolution, which we currently
estimate to be approximately $50,000 to $75,000, from our remaining assets
outside of the trust account. To the extent such funds are not available,
InterAmerican Capital Partners II LLC has agreed to advance us the necessary
funds and has agreed not to seek repayment for such expenses, though it has not
taken a reserve for this possibility and there can be no assurance that it will
be able to meet its obligations under this agreement.
 
 If we
were to expend all of the net proceeds of the initial public offering and the
private placement, other than the proceeds deposited in the trust account, and
without taking into account interest, if any, earned on the trust account, the
initial per-share liquidation price would be $7.85 or $0.15 less than the
per-unit offering price of $8.00. The proceeds deposited in the trust account
could, however, become subject to the claims of our creditors which could be
prior to the claims of our public stockholders. We cannot assure you that the
actual per-share liquidation price will not be less than $7.85, plus interest
(net of taxes payable and net of interest earned on the trust account up to a
maximum amount of $950,000 that will be released to us to fund our working
capital), due to claims of creditors. Although we will seek to have all third
parties we engage for services rendered to us or products sold to us (which
includes, for example, accountants, lawyers, investment bankers, consultants and
analysts, but excludes our independent registered public accounting firm),
prospective target businesses or other entities we engage execute agreements
with us waiving any right, title, interest or claim of any kind in or to any
monies held in the trust account for the benefit of our public stockholders,
there is no guarantee that they will execute such agreements or even if they
execute such agreements that they would be prevented from bringing claims
against the trust account including but not limited to fraudulent inducement,
breach of fiduciary responsibility or other similar claims, as well as claims
challenging the enforceability of the waiver, in each case in order to gain an
advantage with a claim against our assets, including the funds held in the trust
account. If any third party refused to execute an agreement waiving such claims
to the monies held in the trust account, we would perform an analysis of the
alternatives available to us if we chose not to engage such third party and
evaluate if such engagement would be in the best interest of our stockholders if
such third party refused to waive such claims. Examples of possible instances
where we may engage a third party that refused to execute a waiver include the
engagement of a third party consultant whose particular expertise or skills are
believed by management to be significantly superior to those of other
consultants that would agree to execute a waiver or in cases where management is
unable to find a provider of required services willing to provide the waiver. In
any event, our management would perform an analysis of the alternatives
available to it and would only enter into an agreement with a third party that
did not execute a waiver if management believed that such third party’s
engagement would be significantly more beneficial to us than any alternative. In
addition, there is no guarantee that such entities will agree to waive any
claims they may have in the future as a result of, or arising out of, any
negotiations, contracts or agreements with us and will not seek recourse against
the trust account for any reason. Our two executive officers, William C. Morro
and Dr. Richard N. Sinkin, have severally (but not jointly) agreed, pursuant to
agreements with us and Chardan Capital Markets, LLC, that they will be
personally liable, severally (but not jointly), which means they will be
personally liable only for 60% and 40% respectively (as an example, if there is
a valid third party claim of $1,000,000, Mr. Morro will be responsible for
$600,000 of such claim and Dr. Sinkin will be responsible for $400,000 of such
claim), to pay claims of third parties that are owed money for services rendered
to us or products sold to us (which includes, for example, accountants, lawyers,
investment bankers, consultants and analysts) that would reduce the amount of
the trust, provided that such third party has not executed a valid and
enforceable waiver to rights or claims against the trust account and only to the
extent necessary to ensure that such claims do not reduce the amount in the
trust account. The indemnification provided by Mr. Morro and Dr. Sinkin would
not cover tort claims brought against us for some unforeseen event, claims
against us brought by a target business for breach of contract or breach of a
confidentiality agreement with a potential target. We will bring an action
against either of our executive officers in the event that such individual
asserts that he is not able to cover any of the expenses that would deplete the
trust proceeds or that either is not liable pursuant to their indemnification
obligations as described above. Based on the information provided to us in the
director and officer questionnaires provided to us in connection with the
Offering as well as the representations as to their accredited investor status
(as such term is defined in Regulation D), we currently believe that such
persons are of substantial means and capable of funding their indemnity
obligations. However, because the amount of any such indemnification obligations
cannot be estimated, we have not asked Mr. Morro or Dr. Sinkin to reserve for
such an eventuality and there can be no assurance that they will satisfy their
indemnification obligations if and when they arise. Accordingly, the proceeds
held in trust could be subject to claims which could take priority over the
claims of our public stockholders and the per-share liquidation price could be
less than approximately $7.85, plus interest (net of taxes payable and net of
interest earned on the trust account up to a maximum amount of $950,000 that
will be released to us to fund our working capital), due to claims of such
creditors.
 
 9
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 We
believe the likelihood of a member of our management having to make an
indemnification payment to the trust account is limited because we will endeavor
to have all vendors and prospective target businesses as well as other entities
execute agreements with us waiving any right, title, interest or claim of any
kind in or to monies held in the trust account. We also have access to $350,000
in funds initially available outside the trust account plus interest earned on
funds in the trust account, up to a maximum amount of $950,000, that will be
released to us, with which to pay any such potential claims (including costs and
expenses incurred in connection with our plan of dissolution and distribution
currently estimated at approximately $50,000 to $75,000). The indemnification
provisions are set forth in the amended and restated insider letters, dated as
of June 27, 2007, executed by each of our officers. The insider letters were
amended to specifically set forth that in the event we obtain a valid and
enforceable waiver of any right, title, interest or claim of any kind in or to
any monies held in the trust account for the benefit of our stockholders from a
third party we engage for services rendered to us or products sold to us (which
includes, for example, accountants, lawyers, investment bankers, consultants and
analysts), the indemnification will not be available. The amended and restated
insider letters executed by each of our officers, dated as of June 27,
2007, are exhibits to the registration statement of which this prospectus forms
a part. In the event that the board recommends and our stockholders approve a
plan of dissolution and distribution where it is subsequently determined that
the reserve for claims and liabilities is insufficient, stockholders who
received a return of funds from the liquidation of our trust account could be
liable for such amounts to creditors.
 
 Additionally,
if we are forced to file a bankruptcy case or an involuntary bankruptcy case is
filed against us which is not dismissed, the funds held in our trust account
will be subject to applicable bankruptcy law, and may be included in our
bankruptcy estate and subject to the claims of third parties with priority over
the claims of our stockholders. To the extent any bankruptcy claims deplete the
trust account we cannot assure you we will be able to return to our public
stockholders the liquidation amounts due them.
 
 If we
enter into either a letter of intent, an agreement in principle or a definitive
agreement to complete a business combination prior to the expiration of 18
months after the consummation of the Offering, but are unable to complete the
business combination within the 18-month period, then we will have an additional
six months in which to complete the business combination contemplated by the
letter of intent, agreement in principle or definitive agreement. If we are
unable to consummate a transaction within 24 months following the consummation
of the Offering our purpose and powers will be limited to dissolving,
liquidating and winding up. Upon notice from us, the trustee of the trust
account will liquidate the investments constituting the trust account and will
turn over the proceeds to our transfer agent for distribution to our public
stockholders as part of our plan of dissolution and distribution. Concurrently,
we shall pay, or reserve for payment, from funds not held in trust, our
liabilities and obligations, although we cannot assure you that there will be
sufficient funds for such purpose or that our executive officers will be able to
satisfy their indemnification obligations.
 
 Under the
Delaware General Corporation Law, stockholders may be held liable for claims by
third parties against a corporation to the extent of distributions received by
them in a dissolution. If the corporation complies with certain procedures set
forth in Section 280 of the Delaware General Corporation Law intended to ensure
that it makes reasonable provision for all claims against it, including a 60-day
notice period during which any third-party claims can be brought against the
corporation, a 90-day period during which the corporation may reject any claims
brought, and an additional 150-day waiting period before any liquidating
distributions are made to stockholders, any liability of stockholders with
respect to a liquidating distribution is limited to the lesser of such
stockholder’s pro rata share of the claim or the amount distributed to the
stockholder, and any liability of the stockholder would be barred after the
third anniversary of the dissolution. Although we will make liquidating
distributions to our stockholders as soon as reasonably possible as part of our
plan of dissolution and distribution, we do not intend to comply with those
procedures. As such, our stockholders could potentially be liable for any claims
to the extent of distributions received by them in a dissolution and any such
liability of our stockholders will likely extend beyond the third anniversary of
such dissolution. Because we will not be complying with Section 280, we will
seek stockholder approval to comply with Section 281(b) of the Delaware General
Corporation Law, requiring us to adopt a plan of dissolution that will provide
for our payment, based on facts known to us at such time, of (i) all existing
claims, (ii) all pending claims and (iii) all claims that may be potentially
brought against us within the subsequent 10 years. However, because we are a
blank check company, rather than an operating company, and our operations will
be limited to searching for prospective target businesses to acquire, the only
likely claims to arise would be from third parties we engage for services
rendered to us or products sold to us (which includes, for example, accountants,
lawyers, investment bankers, consultants and analysts) (such as accountants,
lawyers, investment bankers, consultants, analysts, etc.) or potential target
businesses. As described above, we intend to have all such third parties and
prospective target businesses execute agreements with us waiving any right,
title, interest or claim of any kind in or to any monies held in the trust
account. As a result of this, the claims that could be made against us are
significantly limited and the likelihood that any claim that would result in any
liability extending to the trust account is minimal.
 10
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 We expect
that all costs associated with the implementation and completion of our plan of
dissolution and distribution, which we currently estimate to be approximately
$50,000 to $75,000, will be funded by any funds not held in our trust account,
although we cannot assure you that there will be sufficient funds for such
purpose. To the extent such funds are not available, the principals of
InterAmerican Capital Partners II LLC have agreed to advance us the necessary
funds and have agreed not to seek repayment for such expenses. However, there
can be no assurance that they will be able to meet their obligations under this
agreement.
 
 We
currently believe that any plan of dissolution and distribution subsequent to
the expiration of the 18 and 24 month deadlines would proceed in the following
manner:
 
 •
                our
      board of directors will, consistent with its obligations described in our
      amended and restated certificate of incorporation to dissolve, prior to
      the passing of such deadline, convene and adopt a specific plan of
      dissolution and distribution, which itwill
      then vote to recommend to our stockholders; at such time it will also
      cause to be prepared a preliminary proxy statement setting out such plan
      of dissolution and distribution and the board’s recommendation of such
      plan;
 
 •
                upon
      such deadline, we would file the preliminary proxy statement with the
      SEC;
 
 •
                if
      the SEC does not review the preliminary proxy statement, then 10 days
      following the passing of such deadline, we will mail the proxy statements
      to our stockholders, and 30 days following the passing of such deadline we
      will convene a meeting of our stockholders at which they will either
      approve or reject our plan of dissolution and distribution;
      and
 
 •
                if
      the SEC does review the preliminary proxy statement, we currently estimate
      that we will receive their comments 30 days following the passing of such
      deadline. We will mail the proxy statements to our stockholders following
      the conclusion of the comment and review process (the length of which we
      cannot predict with any certainty), and we will convene a meeting of our
      stockholders at which they will either approve or reject our plan of
      dissolution and distribution.
 
 In the
event we seek stockholder approval for a plan of dissolution and distribution
and do not obtain such approval, we will nonetheless continue to pursue
stockholder approval for our dissolution. Pursuant to the terms of our second
amended and restated certificate of incorporation, our powers following the
expiration of the permitted time periods for consummating a business combination
will automatically thereafter be limited to acts and activities relating to
dissolving and winding up our affairs, including liquidation. The funds held in
our trust account may not be distributed except upon our dissolution and, unless
and until such approval is obtained from our stockholders, the funds held in our
trust account will not be released. Consequently, holders of a majority of our
outstanding stock must approve our dissolution in order to receive the funds
held in our trust account and the funds will not be available for any other
corporate purpose. In addition, if we seek approval from our stockholders to
consummate a business combination within 90 days of the expiration of 24 months
(assuming that the period in which we need to consummate a business combination
has been extended, as provided in our second amended and restated certificate of
incorporation) from the date of the Offering, the proxy statement related to
such a business combination will also seek stockholder approval for our board’s
recommended plan of distribution and dissolution, in the event our stockholders
do not approve such a business combination. If no proxy statement seeking the
approval of our stockholders for a business combination has been filed 30 days
prior to the date which is 24 months from the date of the Offering, our board
will, prior to such date, convene, adopt and recommend to our stockholders a
plan of dissolution and distribution, and on such date file a proxy statement
with the SEC seeking stockholder approval for such plan. Immediately upon the
approval by our stockholders of our plan of dissolution and distribution, we
will liquidate our trust account to our public stockholders.
 
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 Competition
for acquired businesses
 
 If we
succeed in effecting a business combination with Sing Kung, there will be, in
all likelihood, intense competition from its competitors. We cannot assure you
that, subsequent to a business combination with Sing Kung, the surviving company
will have the resources or ability to compete effectively.
 
 Periodic
reporting and audited financial statements
 
 We have
registered our units, common stock and warrants under the Exchange Act and have
reporting obligations, including the requirement that we file annual, quarterly
and current reports with the SEC. In accordance with the requirements of the
Exchange Act, our annual reports will contain financial statements audited and
reported on by our independent registered public accountants.
 
 Audited
financial statements based on United States generally accepted accounting
principles have been provided by Sing Kung since its inception and these will be
included, together with other required disclosures, as part of the proxy
solicitation materials sent to stockholders to assist them in assessing the
target business.
 
 Available
Information
 
 We are
subject to the information requirements of the Exchange Act. Therefore, we file
periodic reports, proxy statements and other information with the SEC. Such
reports, proxy statements and other information may be obtained by visiting the
Public Reference Room of the SEC at 100 F Street, NW, Washington, DC 20549. You
may obtain information on the operation of the Public Reference Room by calling
the SEC at 1-800-SEC-0330. In addition, theSEC maintains an Internet
site (http://www.sec.gov) that contains reports, proxy and information
statements and other information regarding issuers that file
electronically.
 
 Employees
 
 We have
two executive officers. These individuals are not obligated to devote any
specific number of hours to our matters and intend to devote only as much time
as they deem necessary to our affairs. The amount of time they will devote in
any time period will vary based on the availability of suitable target
businesses to investigate, although we expect Mr. Morro and Dr. Sinkin to each
devote an average of approximately ten hours per week to our business and now
that a suitable target business has been identified, these individuals will
devote additional time as is necessary. We do not have any full time employees,
nor do we intend to have any full time employees prior to the consummation of a
business combination.
 
 Item1A. Risk Factors
 
 An
investment in our securities involves a high degree of risk. You should consider
carefully all of the material risks described below, together with the other
information contained elsewhere in this annual report and the risk factors
described in our proxy statement/prospectus on Form S-4, as amended, initially
filed with the Securities and Exchange Commission on August 12, 2008, relating
to the Sing Kung transaction, before making a decision to invest in our
securities.
 
 RISKS
ASSOCIATED WITH OUR BUSINESS
 
 WE
ARE A DEVELOPMENT STAGE COMPANY WITH NO OPERATING HISTORY AND, ACCORDINGLY, YOU
WILL NOT HAVE ANY BASIS ON WHICH TO EVALUATE OUR ABILITY TO ACHIEVE OUR BUSINESS
OBJECTIVE.
 
 We are a
development stage company with no operating results to date. Since we do not
have any operations or an operating history, you will have no basis upon which
to evaluate our ability to achieve our business objective, which is to acquire
one or more operating businesses without limitation to any particular industry
or geographical location. Although we entered into a stock purchase agreement
with Sing Kung, we will not generate any revenues or income, other than interest
on the trust account funds, until, at the earliest, after the consummation of a
business combination. The financial statements do not include any adjustments
that might result from our ability to consummate the initial public offering or
our ability to operate as a going concern.
 
 12
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 IF
WE ARE FORCED TO DISSOLVE BEFORE THE COMPLETION OF A BUSINESS COMBINATION, OUR
PUBLIC STOCKHOLDERS WILL RECEIVE LESS THAN $8.00 PER SHARE UPON DISTRIBUTION OF
THE TRUST ACCOUNT AND OUR WARRANTS WILL EXPIRE WORTHLESS.
  If we are
unable to complete a business combination within the prescribed time frames and
are forced to liquidate the trust account as part of our plan of dissolution and
distribution (which will include the full amount in the trust account, including
the $2,070,000 held for the benefit of the underwriters and any interest earned
thereon (net of taxes payable) and the $1,500,000 from the warrant purchase),
the per-share liquidation distribution received by our public stockholders from
the trust account will be (unless there are claims not otherwise satisfied by
the amounts not held in the trust account or the indemnification provided by our
two executive officers) approximately $7.85, plus interest, if any (net of taxes
payable and net of interest earned on the trust account up to a maximum amount
of $950,000 that will be released to us to fund our working capital) because of
the expenses of our initial public offering, our general and administrative
expenses and the costs of seeking a business combination. In the event that our
board recommends and our stockholders approve a plan of dissolution and
distribution where it is subsequently determined that the reserve for claims and
liabilities is insufficient, stockholders who received a return of funds from
the liquidation of our trust account could be liable for claims made by our
creditors. Additionally, we could use a portion of the funds not being placed in
trust as a down payment or lock-up payment in connection with a proposed
business combination, although we do not have any current intention to do so. If
we did and were subsequently required to forfeit such funds (whether as a result
of a breach of the terms of the agreement containing the requirement of a down
payment or lock-up payment or otherwise), we might not have sufficient funds to
continue our search for a target business. Furthermore, there will be no
distribution with respect to our outstanding warrants which will expire
worthless if we liquidate the trust account as part of our plan of dissolution
and distribution in the event we do not complete a business combination within
the required time periods. For a more complete discussion of the effects on our
stockholders if we are unable to complete a business combination, see the
section in Item 1 above entitled ‘‘Plan of dissolution and liquidation if no
business combination.’’
  IF
THIRD PARTIES BRING CLAIMS AGAINST US, THE PROCEEDS HELD IN TRUST COULD BE
REDUCED AND THE PER-SHARE LIQUIDATION PRICE RECEIVED BY STOCKHOLDERS FROM THE
TRUST ACCOUNT AS PART OF OUR PLAN OF DISSOLUTION AND DISTRIBUTION WILL BE LESS
THAN $7.85 PER SHARE AND THE PER SHARE REDEMPTION PRICE FOR REDEEMING
STOCKHOLDERS COULD BE LESS THAN $7.85.
 
 Our
placing of funds in trust may not protect those funds from third party claims
against us. Although we will seek to have all third parties we engage for
services rendered to us or products sold to us (which includes, for example,
accountants, lawyers, investment bankers, consultants and analysts, but excludes
our independent registered public accounting firm), prospective target
businesses or other entities we engage, execute agreements with us waiving any
right, title, interest or claim of any kind in or to any monies held in the
trust account for the benefit of our public stockholders, there is no guarantee
that they will execute such agreements or even if they execute such agreements
that they would be prevented from bringing claims against the trust account
including, but not limited to, fraudulent inducement, breach of fiduciary
responsibility or other similar claims, as well as claims challenging the
enforceability of the waiver, in each case in order to gain an advantage with a
claim against our assets, including the funds held in the trust account. If any
third party refuses to execute an agreement waiving such claims to the monies
held in the trust account, we would perform an analysis of the alternatives
available to us if we chose not to engage such third party and evaluate if such
engagement would be in the best interest of our stockholders if such third party
refused to waive such claims. Examples of possible instances where we may engage
a third party that refuses to execute a waiver include the engagement of a third
party consultant whose particular expertise or skills are believed by management
to be significantly superior to those of other consultants that would agree to
execute a waiver or in cases where management is unable to find a provider of
required services willing to provide the waiver. In addition, there is no
guarantee that such entities will agree to waive any claims they may have in the
future as a result of, or arising out of, any negotiations, contracts or
agreements with us and will not seek recourse against the trust account for any
reason. Accordingly, the proceeds held in trust could be subject to claims which
could take priority over the claims of our public stockholders. We cannot assure
you that the per-share distribution from the trust account will not be less than
$7.85, plus interest, (net of taxes payable and interest earned on the trust
account up to a maximum amount of $950,000 that will be released to us to fund
our working capital), due to claims of such creditors. If we liquidate before
the completion of a business combination and distribute the proceeds held in
trust to our public stockholders, William C. Morro, our chief executive officer,
chief financial officer and chairman of our board of directors and Dr. Richard
N. Sinkin, our chief operating officer, secretary and a member of our board of
directors, have severally (but not jointly) agreed, pursuant to agreements with
us and Chardan Capital Markets, LLC, that they will be personally liable,
severally (but not jointly), which means they will be personally liable only for
60% and 40%, respectively (as an example, if there is a valid third party claim
of $1,000,000, Mr. Morro will be responsible for $600,000 of such claim and
Dr. Sinkin will be responsible for $400,000 of such claim), to pay claims
of third parties that are owed money for services rendered to us or products
sold to us (which includes, for example, accountants, lawyers, investment
bankers, consultants and analysts) that would reduce the amount of the trust,
provided that such third party has not executed a valid and enforceable waiver
to rights or claims against the trust account and only to the extent necessary
to ensure that such claims do not reduce the amount in the trust account. The
indemnification provided by Mr. Morro and Dr. Sinkin would not cover tort claims
brought against us for some unforeseen event, claims against us brought by a
target business for breach of contract or breach of a confidentiality agreement
with a potential target. We will bring an action against either of our executive
officers in the event that such individual asserts that he is not able to cover
any of the expenses that would deplete the trust proceeds or that either is not
liable pursuant to their indemnification obligations as described above. Based
on the information provided to us in the director and officer questionnaires
provided to us in connection with our initial public offering as well as the
representations as to their accredited investor status (as such term is defined
in Regulation D), we currently believe that such persons are of substantial
means and capable of funding their indemnity obligations. However, because the
amount of any such indemnification obligations cannot be estimated, we have not
asked Mr. Morro or Dr. Sinkin to reserve for such an eventuality and there can
be no assurance that they will satisfy their indemnification obligations if and
when they arise. Further, they will not be personally liable to pay debts and
obligations to prospective target businesses, if a business combination is not
consummated with such prospective target businesses, or for claims from any
entity other than as described above. Accordingly, the proceeds held in trust
could be subject to claims which could take priority over the claims of our
public stockholders and the per-share liquidation price could be less than
approximately $7.85, plus interest (net of taxes payable and net of interest
earned on the trust account up to a maximum amount of $950,000 that will be
released to us to fund our working capital), due to claims of such creditors. In
addition, such third party claims could result in the per share redemption price
received by stockholders who vote against a business combination and elect to
redeem their shares for cash being less than approximately $7.85, plus interest
(net of taxes payable and net of interest previously released to us). In the
event that our board recommends and our stockholders approve a plan of
dissolution and distribution where it is subsequently determined that the
reserve for claims and liabilities is insufficient, stockholders who received a
return of funds from our trust account as part of its liquidation could be
liable for claims made by creditors.
 13
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 Additionally,
if we are forced to file a bankruptcy case or an involuntary bankruptcy case is
filed against us which is not dismissed, the funds held in our trust account
will be subject to applicable bankruptcy law, and may be included in our
bankruptcy estate and subject to the claims of third parties with priority over
the claims of our stockholders. To the extent any bankruptcy claims deplete the
trust account we cannot assure you we will be able to return to our public
stockholders the liquidation amounts due them.
 
 OUR
PUBLIC STOCKHOLDERS ARE NOT ENTITLED TO PROTECTIONS NORMALLY AFFORDED TO
INVESTORS OF BLANK CHECK COMPANIES.
 
 Since the
net proceeds of our initial public offering are intended to be used to complete
a business combination with a target business that was not identified at the
time of our initial public offering, we are deemed to be a ‘‘blank check’’
company under the United States securities laws. However, since we have net
tangible assets in excess of $5,000,000 and filed a Current Report on Form 8-K
with the Securities and Exchange Commission upon consummation of our initial
public offering including an audited balance sheet demonstrating this fact, we
are exempt from rules promulgated by the Securities and Exchange Commission to
protect investors of blank check companies such as Rule 419. Accordingly,
investors will not be afforded the benefits or protections of those
rules.
 
 BECAUSE
THERE ARE NUMEROUS COMPANIES WITH A BUSINESS PLAN SIMILAR TO OURS SEEKING TO
EFFECTUATE A BUSINESS COMBINATION, IT WILL BE MORE DIFFICULT FOR US TO DO SO IF
WE ARE UNABLE TO COMPLETE THE SING KUNG TRANSACTION.
 
 Since
2003, based upon publicly available information, approximately 161 similarly
structured blank check companies have completed initial public offerings in the
United States. Of these companies, only 64 companies have consummated a business
combination, while 17 other companies have announced they have entered into a
definitive agreement for a business combination, but have not consummated such
business combination, and 39 companies have failed to complete business
combinations and have either dissolved or announced their intention to dissolve
and return trust proceeds to their stockholders. Accordingly, there are
approximately 41 blank check companies with more than $9.6 billion in trust that
are seeking to carry out a business plan similar to our business plan if we are
unable to consummate the Sing Kung transaction. Furthermore, there are a number
of additional offerings for blank check companies that are still in the
registration process but have not completed initial public offerings and there
are likely to be more blank check companies filing registration statements for
initial public offerings after the date of this annual report and prior to our
completion of a business combination. While some of those companies must
complete a business combination in specific industries, a number of them may
consummate a business combination in any industry they choose. Therefore, we
will be subject to competition from these and other companies seeking to
consummate a business plan similar to ours if we are unable to consummate the
Sing Kung transaction. Because of this competition, we cannot assure you that we
will be able to effectuate a business combination within the required time
periods. If we are unable to consummate a business combination within the
prescribed time period, we will be forced to liquidate.
 
 IF THE CASH NOT HELD IN TRUST IS
INSUFFICIENT TO ALLOW US TO OPERATE FOR AT LEAST 24MONTHS FROM THE CONSUMMATION OF OUR
INITIAL PUBLIC OFFERING, WE MAY NOT BE ABLE TO COMPLETE A BUSINESS COMBINATION
OR TO CONTINUE AS A GOING CONCERN.
 
 We
believe that the funds held by us outside the trust account (including the
$950,000 available to us from interest earned on the funds in the trust account)
and the contingency arrangements we have entered into with certain vendors are
sufficient to allow us to operate until approximately June 2009 (which is less
than 24 months from our initial public offering), assuming that a business
combination with Sing Kung is not consummated during that time. Although we
cannot assure you that our estimates are accurate even if the business
combination with Sing Kung remains possible, we do not expect that the resources
currently available to us will allow us to operate until September 10, 2009 and
we may be forced to liquidate. If we do not consummate the Sing Kung transaction
by approximately the end of June 2009, we will not have sufficient funds to
continue searching for an alternative business combination and we would expect
to be forced to liquidate in that circumstance and would not be able to continue
as a going concern.
 
 14
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 WE
ARE DEPENDENT UPON INTEREST EARNED ON THE TRUST ACCOUNT AND CONTINGENCY
ARRANGEMENTS WITH CERTAIN OF OUR VENDORS TO FUND THE ACTIVITIES NECESSARY TO
CONSUMMATE A BUSINESS COMBINATION.
  Following
our initial public offering, we had only approximately $350,000 available to us
outside the trust account to fund our working capital requirements, including
meeting certain accrued expenses of our initial public offering. We are
dependent upon sufficient interest being earned on the proceeds held in the
trust account to provide us with the additional working capital we will need to
search for a target company and consummate a business combination and to pay our
taxes. While we are entitled to the interest earned on the trust account (net of
taxes payable) up to a maximum of $950,000 for such purpose, if interest rates
do not increase from the low levels prevailing as of March 2009, we may not have
sufficient funds available to complete a business combination. In such event, we
would need to borrow funds from our insiders or others or be forced to
liquidate. There is no assurance that we will be able to borrow additional funds
from any source and our insiders do not have any obligation to provide
additional funds for us to continue pursuing a business
combination.
  BECAUSE
OF THE SIGNIFICANT COMPETITION FOR BUSINESS COMBINATION OPPORTUNITIES, THE
LIMITED TIME REMAINING FOR US TO COMPLETE A BUSINESS COMBINATION AND OUR LIMITED
RESOURCES, IT IS UNLIKELY THAT WE WILL BE ABLE TO CONSUMMATE AN ATTRACTIVE
BUSINESS COMBINATION IF OUR STOCKHOLDERS DO NOT APPROVE THE SING KUNG
TRANSACTION.
 
 We expect
to encounter intense competition from other entities having a business objective
similar to ours, including other similar blank check companies as well as
venture capital funds, leveraged buyout funds and operating businesses competing
for acquisitions in the event that our stockholders do not approve the Sing Kung
transaction. Many of these entities are well established and have extensive
experience in identifying and effecting business combinations directly or
through affiliates. Many of these competitors possess greater technical, human
and other resources than we do and our financial resources will be relatively
limited when contrasted with those of many of these competitors. While we
believe that there are numerous potential target businesses that we could
acquire with the net proceeds of our initial public offering, our ability to
compete in acquiring certain sizable target businesses will be limited by the
short time remaining before the deadline for consummating a business
combination, September 10, 2009, and by our available financial resources. This
inherent competitive limitation gives others an advantage in pursuing the
acquisition of certain target businesses. In addition, we may not have enough
cash available from funds outside of the trust account to make deposits or fund
a ‘‘no-shop’’ provision in connection with a particular business combination
which may cause us to be at a competitive disadvantage in pursuing the
acquisition of target businesses. Further, the obligation we have to seek
stockholder approval of a business combination may delay the consummation of a
transaction. Additionally, our outstanding warrants, and the future dilution
they potentially represent, may not be viewed favorably by certain target
businesses. Any of these obligations may place us at a competitive disadvantage
in or preclude us from successfully negotiating an alternative business
combination.
 
 WE
WILL DISSOLVE AND LIQUIDATE IF WE DO NOT CONSUMMATE A BUSINESS COMBINATION
WITHIN THE ALLOWED PERIOD AND OUR STOCKHOLDERS MAY BE HELD LIABLE FOR CLAIMS BY
THIRD PARTIES AGAINST US TO THE EXTENT OF DISTRIBUTIONS RECEIVED BY
THEM.
 
 We will
dissolve and liquidate our trust account to our public stockholders if we do not
complete a business combination within 18 months after the consummation of our
initial public offering (or within 24 months after the consummation of our
initial public offering if certain extension criteria are satisfied). There is
no guarantee that we will be able to complete a business combination in this
time frame.  This factor raises a substantial doubt about the
Company’s ability to continue as a going concern and our independent registered
public accounting firm has included language regarding this uncertainty in their
audit report.   Under Sections 280 through 282 of the Delaware
General Corporation Law, stockholders may be held liable for claims by third
parties against a corporation to the extent of distributions received by them in
a dissolution. If the corporation complies with certain procedures intended to
ensure that it makes reasonable provision for all claims against it, including a
60-day notice period during which any third-party claims can be brought against
the corporation, a 90-day period during which the corporation may reject any
claims brought, and an additional 150-day waiting period before any liquidating
distributions are made to stockholders, any liability of stockholders with
respect to a liquidating distribution is limited to the lesser of such
stockholder’s pro rata share of the claim or the amount distributed to the
stockholder, and any liability of the stockholder would be barred after the
third anniversary of the dissolution. Although we will seek stockholder approval
to liquidate the trust account to our public stockholders as part of our plan of
dissolution and distribution, we do not intend to comply with those procedures.
In the event that the board recommends and the stockholders approve a plan of
dissolution and distribution where it is subsequently determined that the
reserve for claims and liabilities was insufficient, stockholders who received a
return of funds could be liable for claims made by creditors. As such, our
stockholders could potentially be liable for any claims to the extent of
distributions received by them in a dissolution and any such liability of our
stockholders will likely extend beyond the third anniversary of such
dissolution. Accordingly, we cannot assure you that third parties will not seek
to recover from our stockholders amounts owed to them by us.
 
 15
 Table of Contents
 THE
PROCEDURES WE MUST FOLLOW UNDER DELAWARE LAW AND OUR SECOND AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION IF WE DISSOLVE AND LIQUIDATE MAY RESULT IN
SUBSTANTIAL DELAYS IN THE LIQUIDATION OF OUR TRUST ACCOUNT TO OUR PUBLIC
STOCKHOLDERS AS PART OF OUR PLAN OF DISSOLUTION AND
DISTRIBUTION.
  Pursuant
to, among other documents, our second amended and restated certificate of
incorporation, if we do not complete a business combination within 18 months
after the consummation of our initial public offering, or within 24 months after
the consummation of our initial public offering if the extension criteria have
been satisfied, we will be required to dissolve, liquidate and wind up in
compliance with the provisions of the Delaware General Corporation Law. In
addition, in the event we seek stockholder approval for a plan of dissolution
and distribution and do not obtain such approval, we will nonetheless continue
to pursue stockholder approval for our dissolution. The funds held in our trust
account may not be distributed except upon our dissolution and, unless and until
such approval is obtained from our stockholders, the funds held in our trust
account will not be released. Consequently, holders of a majority of our
outstanding stock must approve our dissolution in order to receive the funds
held in our trust account and the funds will not be available for any other
corporate purpose. The procedures required for us to liquidate under the
Delaware General Corporation Law, or a vote to reject any plan of dissolution
and distribution by our stockholders, may result in substantial delays in the
liquidation of our trust account to our public stockholders as part of our plan
of dissolution and distribution.
  IN
THE EVENT THAT WE DO NOT CONSUMMATE THE SING KUNG TRANSACTION, THE MERITS AND
RISKS ASSOCIATED WITH AN ALTERNATIVE TRANSACTION CANNOT BE ASCERTAINED BECAUSE
NO CONTINGENT ACQUISITION TARGET HAS BEEN IDENTIFIED AND THE INDUSTRY AND
BUSINESS IN WHICH WE WOULD ULTIMATELY OPERATE ARE UNKNOWN.
  We may
consummate a business combination with a manufacturing or service company in any
industry we choose and are not limited to any particular industry or
geographical location. Accordingly, if the Sing Kung transaction is not
consummated and we were able to pursue another business combination, there is no
current basis for you to evaluate the possible merits or risks of the particular
industry in which we may ultimately operate or the target business which we may
ultimately acquire. If we complete a business combination with an entity in an
industry characterized by a high level of risk, we may be affected by the
currently unascertainable risks of that industry. Although our management will
endeavor to evaluate the risks inherent in a particular industry or target
business, we cannot assure you that we will properly ascertain or assess all of
the significant risk factors. We also cannot assure you that an investment in
our securities will not ultimately prove to be less favorable to investors in
our initial public offering than a direct investment, if an opportunity were
available, in a target business.
  WE
INTEND TO ISSUE SHARES OF OUR CAPITAL STOCK TO COMPLETE THE SING KUNG
TRANSACTION, WHICH WOULD REDUCE THE EQUITY INTEREST OF OUR STOCKHOLDERS AND
LIKELY CAUSE A CHANGE IN CONTROL OF OUR OWNERSHIP.
  Our
certificate of incorporation authorizes the issuance of up to 90,000,000 shares
of common stock, par value $.0001 per share, and 1,000,000 shares of preferred
stock, par value $.0001 per share. Following our initial public offering and the
issuance of warrants to certain of our founders in May 2008, there are
76,065,000 authorized but unissued shares of our common stock available for
issuance (after appropriate reservation for the issuance of shares upon full
exercise of our outstanding warrants) and all of the 1,000,000 shares of
preferred stock available for issuance. The Sing Kung transaction contemplates
that we will issue approximately 23.6 million shares of our common stock to
existing Sing Kung stockholders, and if we were to conclude any alternative
business combination, it is likely that we would issue a substantial number of
our shares of common stock. The issuance of additional shares of our common
stock as contemplated in the Sing Kung transaction:
  •
                will
      significantly reduce the equity interest of current
    investors;
 •
                will
      cause a change in control which may affect, among other things, our
      ability to use our net operating loss carry forwards, if any, and result
      in the resignation, removal or reduction in authority of our present
      officers and directors; and
 •
                may
      adversely affect prevailing market prices for our common
      stock.
  Similar
effects would be expected if significant share issuances occurred in conjunction
with an alternative business combination.
  16
 Table of Contents
 WE
MAY ISSUE DEBT SECURITIES TO COMPLETE A BUSINESS COMBINATION, WHICH COULD CAUSE
A DEFAULT AND FORECLOSURE ON OUR ASSETS IF OUR OPERATING REVENUES AFTER A
BUSINESS COMBINATION ARE INSUFFICIENT TO PAY OUR DEBT OBLIGATIONS AND MAY
RESTRICT US FROM OBTAINING ADDITIONAL FINANCING IF NECESSARY.
  Although
it is not currently expected to be required to complete the Sing Kung
transaction, if we issue our debt securities to complete that or any business
combination, it could result in:
  •
                default
      and foreclosure on our assets if our operating revenues after a business
      combination are insufficient to pay our debt
  obligations;
 •
                acceleration
      of our obligations to repay the indebtedness even if we have made all
      principal and interest payments when due if the debt security contains
      covenants that require the maintenance of certain financial ratios or
      reserves and any such covenant is breached without a waiver or
      renegotiation of that
covenant;
 •
                our
      immediate payment of all principal and accrued interest, if any, if the
      debt security is payable on demand;
and
 •
                our
      inability to obtain additional financing, if necessary, if the debt
      security contains covenants restricting our ability to obtain additional
      financing while such security is
outstanding.
  WE
MAY BE UNABLE TO OBTAIN ADDITIONAL FINANCING, IF REQUIRED, TO COMPLETE A
BUSINESS COMBINATION OR TO FUND THE OPERATIONS AND GROWTH OF THE TARGET
BUSINESS, WHICH COULD COMPEL US TO RESTRUCTURE OR ABANDON A PARTICULAR BUSINESS
COMBINATION.
 
 We
believe that the net proceeds from our initial public offering and the
warrant purchase will be sufficient to allow us to consummate a business
combination with Sing Kung. However, if the net proceeds from the initial public
offering and the warrant purchase prove to be insufficient, either because we
are forced to pursue an alternative business combination or the depletion of the
available net proceeds (including interest earned on the trust account released
to us) precludes us from being able to consummate the Sing Kung transaction or
pursue an alternative transaction, or because we become obligated to redeem for
cash a significant number of shares from dissenting stockholders, we will be
required to seek additional financing. We cannot assure you that such financing
would be available on acceptable terms, if at all. To the extent that additional
financing proves to be unavailable when needed to consummate a particular
business combination, we would be compelled to restructure the transaction or
abandon that particular business combination and seek an alternative target
business candidate. Thus, if we were unable to secure additional financing, we
would most likely fail to consummate a business combination in the allotted time
and would dissolve and liquidate the trust account as part of our plan of
dissolution and distribution, resulting in a loss of a portion of your
investment. In addition, if we consummate a business combination with Sing Kung
or any other party, we may require additional financing to fund the operations
or growth of the target business. The failure to secure additional financing
could have a material adverse effect on the continued development or growth of
the target business. None of our officers, directors or stockholders is required
to provide any financing to us in connection with or after a business
combination.
 
 INITIALLY,
IT IS PROBABLE THAT WE WILL ONLY BE ABLE TO COMPLETE ONE BUSINESS COMBINATION,
WHICH WILL CAUSE US TO BE SOLELY DEPENDENT ON A SINGLE BUSINESS AND A LIMITED
NUMBER OF PRODUCTS OR SERVICES.
 
 The net
proceeds from our initial public offering and the warrant purchase provide us
with only approximately $43,090,000 in the trust account (before giving effect
to shares subject to redemption) which we may use to complete a business
combination. Our initial business combination must be with a business with a
fair market value of at least 80% of our net assets at the time of such
acquisition. We can also satisfy the requirement that the business combination
have a fair market value at least equal to 80% of our net assets in an
acquisition transaction where we acquire less than a 100% interest in the target
business, provided that the fair market value of the interest in such business
or businesses is at least equal to 80% of our net assets at the time such
acquisition transaction is consummated. Consequently, initially it is probable
that we will have the ability to complete a business combination with only a
single operating business. This would be the case if we complete the Sing Kung
transaction. Accordingly, the prospects for our success may be:
 •
                solely
      dependent upon the performance of a single business,
  or
 •
                dependent
      upon the development or market acceptance of a single or limited number of
      products, processes or
services.
 In this
case, we will not be able to diversify our operations or benefit from the
possible spreading of risks or offsetting of losses, unlike other entities which
may have the resources to complete several business combinations in different
industries or different areas of a single industry.
 17
 Table of Contents
 THE
ABILITY OF OUR STOCKHOLDERS TO EXERCISE THEIR REDEMPTION RIGHTS MAY NOT ALLOW US
TO EFFECTUATE THE MOST DESIRABLE BUSINESS COMBINATION OR OPTIMIZE OUR CAPITAL
STRUCTURE.
 
 In
connection with the stockholder approval of Sing Kung transaction and any other
business combination, each public stockholder may have such stockholder’s shares
of common stock redeemed for cash if the stockholder votes against the business
combination and the business combination is approved and completed. Accordingly,
if our business combination requires us to use substantially all of our cash to
pay the purchase price, because we will not know how many stockholders may
exercise such redemption rights, we may either need to reserve part of the trust
account for possible payment upon such redemption, or we may need to arrange
third party financing to help fund our business combination in case a larger
percentage of stockholders exercise their redemption rights than we expected.
Therefore, we may not be able to consummate a business combination that requires
us to use all of the funds held in the trust account as part of the purchase
price, or we may end up having a leverage ratio that is not optimal for our
business combination. This may limit our ability to effectuate the Sing Kung
transaction or a future business combination, if such business combination
becomes available to us.
 
 OUR
OUTSTANDING WARRANTS MAY HAVE AN ADVERSE EFFECT ON THE MARKET PRICE OF COMMON
STOCK AND MAKE IT MORE DIFFICULT TO EFFECT A BUSINESS
COMBINATION.
 
 In
connection with our initial public offering, as part of the units, we issued
warrants to purchase 5,750,000 shares of common stock. In addition,
contemporaneous with the initial public offering, we sold an aggregate of
1,000,000 warrants to InterAmerican Capital Partners II LLC and affiliates and
to one of our special advisors. The founding stockholders and one of the
Company’s special advisors also hold 185,000 warrants, an amount that will be
reduced to 55,850 to comply with Amendment No.1 to the stock purchase
agreement. The potential for the issuance of substantial numbers of
additional shares upon exercise of these warrants could make us a less
attractive acquisition vehicle in the eyes of a target business as such
securities, when exercised, will increase the number of issued and outstanding
shares of our common stock and reduce the value of the shares issued to complete
the business combination. Accordingly, our warrants may make it more difficult
to effectuate a business combination or increase the cost of the target
business. Additionally, the sale, or even the possibility of sale, of the shares
underlying the warrants could have an adverse effect on the market price for our
securities or on our ability to obtain future financing and it could induce
current stockholders to vote against the proposed transaction and to seek
redemption of their shares. If and to the extent the above-mentioned warrants
are exercised, our stockholders will experience dilution to their
holdings.
 
 IF
OUR FOUNDING STOCKHOLDERS EXERCISE THEIR REGISTRATION RIGHTS, IT MAY HAVE AN
ADVERSE EFFECT ON THE MARKET PRICE OF OUR COMMON STOCK AND THE EXISTENCE OF
THESE RIGHTS MAY MAKE IT MORE DIFFICULT TO EFFECT A BUSINESS
COMBINATION.
 
 Our
founding stockholders are entitled to make a demand that we register the resale
of their shares of common stock at any time commencing three months prior to the
date on which their shares are released from escrow. If our founding
stockholders exercise their registration rights with respect to all of their
shares of common stock, then there will be an additional 1,250,000 shares of
common stock eligible for trading in the public market. The presence of this
additional number of shares of common stock eligible for trading in the public
market may have an adverse effect on the market price of our common stock. In
addition, the existence of these rights may make it more difficult to effectuate
a business combination or increase the cost of acquiring the target business, as
the stockholders of the target business may be discouraged from entering into a
business combination with us or will request a higher price for their securities
as a result of these registration rights and the potential future effect their
exercise may have on the trading market for our common stock.
 
 IF
WE ARE DEEMED TO BE AN INVESTMENT COMPANY, WE MAY BE REQUIRED TO INSTITUTE
BURDENSOME COMPLIANCE REQUIREMENTS AND OUR ACTIVITIES MAY BE RESTRICTED, WHICH
MAY MAKE IT MORE DIFFICULT FOR US TO COMPLETE A BUSINESS
COMBINATION.
 
 If we are
deemed to be an investment company under the Investment Company Act of 1940, we
may be subject to certain restrictions that may make it more difficult for us to
complete a business combination, including:
 
 •
              restrictions
      on the nature of our investments;
and
 •
              restrictions
      on the issuance of securities.
 
 In
addition, we may have imposed upon us certain burdensome requirements,
including:
 
 •
              registration
      as an investment company;
 •
              adoption
      of a specific form of corporate structure;
and
 •
                reporting,
      record keeping, voting, proxy compliance policies and procedures and
      disclosure requirements and other rules and
  regulations.
 18
 Table of Contents
 We do not
believe that our anticipated principal activities will subject us to the
Investment Company Act of 1940, as amended. To this end, the proceeds held in
trust may only be invested by the trust agent in Treasury Bills issued by the
United States with maturity dates of 180 days or less or in money market funds
meeting certain conditions under Rule 2a-7 promulgated under the Investment
Company Act of 1940. By restricting the investment of the proceeds to these
instruments, we intend to avoid being deemed an investment company within the
meaning of the Investment Company Act of 1940. This offering is not intended for
persons who are seeking a return on investments in government securities. The
trust account and the purchase of government securities for the trust account is
intended as a holding place for funds pending the earlier to occur of either:
(i) the consummation of our primary business objective, which is a business
combination, or (ii) absent a business combination, our dissolution and
return of the funds held in this trust account to our public stockholders as
part of our plan of dissolution and distribution. Notwithstanding our belief
that we are not required to comply with the requirements of such act, in the
event that the stockholders do not approve a plan of dissolution and
distribution and the funds remain in the trust account for an indeterminable
amount of time, we may be considered to be an investment company and thus
required to comply with such act. If we were deemed to be subject to that act,
compliance with these additional regulatory burdens would require additional
expense for which we have not allotted.
 
 OUR
ABILITY TO SUCCESSFULLY EFFECT A BUSINESS COMBINATION AND TO BE SUCCESSFUL
AFTERWARDS WILL BE TOTALLY DEPENDENT UPON THE EFFORTS OF OUR KEY PERSONNEL, SOME
OF WHOM MAY CONTINUE WITH US FOLLOWING A BUSINESS COMBINATION, BUT MOST OF WHOM
ARE LIKELY TO BE NEW OR ASSOCIATED WITH THE ACQUIRED
BUSINESS.
 
 Our
ability to successfully effect a business combination will be totally dependent
upon the efforts of our key personnel. The future role of our key personnel in
the target business, however, cannot presently be ascertained. Although it is
anticipated that William C. Morro will remain associated with the target
business if we complete the Sing Kung transaction, and it is possible that Dr.
Richard N. Sinkin may continue his involvement in an executive or advisory
position following a business combination, their ultimate willingness to do so
will depend on reaching satisfactory agreements with the board of directors of
the company following the business combination regarding compensation,
responsibilities and other such matters. Mr. Morro has agreed to continue on as
Executive Vice Chairman of the board of directors and Chief Corporate
Development Officer following the consummation of the business combination,
subject to being able to negotiate a satisfactory compensation arrangement with
the board of directors of the combined company. Mr. Morro will not be the Chief
Executive Officer following the consummation of the Sing Kung transaction and
therefore his influence over the strategy and operations of the business will be
reduced. Therefore, it is likely that some or all of the board members and
management of the target business at the time of the business combination will
remain in place if the Sing Kung transaction is consummated. If we do not
complete the Sing King transaction, the ability of our management team to remain
with the combined company will depend on their experience in the industry of the
acquired business. Although we intend to closely scrutinize the management of a
prospective target business in connection with evaluating the desirability of
effecting a business combination, we cannot assure you that our assessment of
management will prove to be correct. In the case of the Sing Kung transaction,
the difficulty of assessing management is increased by the geographic distance
between the management of the Company and Sing Kung, as well as the differences
in language and culture.
 
 OUR
OFFICERS AND DIRECTORS WILL ALLOCATE THEIR TIME TO OTHER BUSINESSES THEREBY
CAUSING CONFLICTS OF INTEREST IN THEIR DETERMINATION AS TO HOW MUCH TIME TO
DEVOTE TO OUR AFFAIRS. THIS CONFLICT OF INTEREST COULD HAVE A NEGATIVE IMPACT ON
OUR ABILITY TO CONSUMMATE A BUSINESS COMBINATION.
 
 Our
officers and directors are not required to commit their full time to our
affairs, which may result in a conflict of interest in allocating their time
between our operations and other businesses. We do not currently and do not
intend to have any full time employees prior to the consummation of a business
combination. All of our executive officers are engaged in several other business
endeavors and are not obligated to contribute any specific number of hours to
our affairs. If our executive officers’ other business affairs require them to
devote more substantial amounts of time to such affairs, it could limit their
ability to devote time to our affairs and could have a negative impact on our
ability to consummate a business combination. For additional discussion of the
potential conflicts of interest that you should be aware of, see the section in
Item 10 below entitled ‘‘Conflicts of interest.’’ We cannot assure you that
these conflicts will be resolved in our favor.
 
 OUR
OFFICERS, DIRECTORS AND THEIR AFFILIATES MAY IN THE FUTURE BECOME AFFILIATED
WITH ENTITIES ENGAGED IN BUSINESS ACTIVITIES SIMILAR TO THOSE INTENDED TO BE
CONDUCTED BY US AND ACCORDINGLY, MAY HAVE CONFLICTS OF INTEREST IN DETERMINING
WHICH ENTITY A PARTICULAR BUSINESS OPPORTUNITY SHOULD BE PRESENTED
TO.
 
 None of
our directors, officers or their affiliates has been a principal of, or
affiliated or associated with, a blank check company and none of such
individuals is currently affiliated with any such entity. However, our officers
and directors may in the future become affiliated with entities, including other
‘‘blank check’’ companies, engaged in business activities similar to those
intended to be conducted by us. Additionally, our officers and directors may
become aware of business opportunities which may be appropriate for presentation
to us as well as the other entities to which they owe fiduciary duties.
Accordingly, they may have conflicts of interest in determining to which entity
a particular business opportunity should be presented. For additional discussion
of our management’s affiliations and the potential conflicts of interest that
you should be aware of, see the section in Item 10 below entitled ‘‘Conflicts of
interest.’’
 19
 Table of Contents
 ALL
OF OUR OFFICERS, DIRECTORS AND SPECIAL ADVISORS OWN SHARES OF OUR COMMON STOCK
WHICH WILL NOT PARTICIPATE IN THE LIQUIDATION OF THE TRUST ACCOUNT AND THEREFORE
THEY MAY HAVE A CONFLICT OF INTEREST IN DETERMINING WHETHER A PARTICULAR TARGET
BUSINESS IS APPROPRIATE FOR A BUSINESS COMBINATION.
 
 All of
our officers, directors and special advisors own shares of our common stock that
were issued prior to our initial public offering, but have waived their right to
receive distributions with respect to those shares upon the liquidation of the
trust account if we are unable to consummate a business combination.
Additionally, InterAmerican Capital Partners II LLC and affiliates, together
with one of our special advisors, purchased $1,500,000 of warrants from us in a
private placement contemporaneous with the consummation of our initial public
offering. The founding stockholders and one of the Company’s special
advisors also hold 185,000 warrants, an amount that will be reduced to 55,850 to
comply with Amendment No.1 to the stock purchase agreement. Our officers and
directors and certain of their affiliates or designees may purchase securities
in the open market (although they are not obligated to do so). If they units or
shares of common stock in the open market, they have agreed to vote such shares
of common stock in accordance with the majority of the shares of common stock
voted by the public stockholders on a proposal to approve a business combination
and exercise redemption rights in connection therewith. The shares and warrants
owned by our directors, officers, special advisors and InterAmerican Capital
Partners II LLC and affiliates (other than those purchased in our initial public
offering or the aftermarket) will be worthless if we do not consummate a
business combination. The personal and financial interests of our directors,
officers and special advisors may influence their motivation in identifying and
selecting a target business and completing a business combination timely.
Consequently, our directors’, officers’ and special advisors’ discretion in
identifying and selecting a suitable target business may result in a conflict of
interest when determining whether the terms, conditions and timing of a
particular business combination are appropriate and in our stockholders’ best
interest.
 
 OUR
FOUNDING STOCKHOLDERS WILL NOT BE REIMBURSED FOR ANY OUT-OF-POCKET EXPENSES
INCURRED BY THEM TO THE EXTENT THAT SUCH EXPENSES EXCEED THE AVAILABLE FUNDS
OUTSIDE THE TRUST ACCOUNT UNLESS THE BUSINESS COMBINATION IS CONSUMMATED AND
THEREFORE THEY MAY HAVE A CONFLICT OF INTEREST IN DETERMINING WHETHER A
PARTICULAR TARGET BUSINESS IS APPROPRIATE FOR A BUSINESS COMBINATION AND IN THE
PUBLIC STOCKHOLDERS’ BEST INTEREST.
 
 Our
founding stockholders, including all of our officers and directors, will not be
reimbursed for any out-of-pocket expenses incurred by them to the extent that
such expenses exceed the available funds held outside the trust account and the
portion of the interest earned on the trust account released to us (which,
because interest rates are unknown, may be insufficient to fund all of our
working capital requirements) unless the business combination is consummated.
The financial interest of our officers and directors could influence their
motivation in selecting or continuing the pursuit of a target business
combination and thus, there may be a conflict of interest when determining
whether a particular business combination, including the Sing Kung transaction
is in the stockholders’ best interest. We would note, however, that such
expenses are likely to be insignificant compared to the value of management’s
equity stake.
 
 OUR
FOUNDING STOCKHOLDERS, INCLUDING OUR OFFICERS AND DIRECTORS, CONTROL A
SUBSTANTIAL INTEREST IN US AND THUS MAY INFLUENCE CERTAIN ACTIONS REQUIRING A
STOCKHOLDER VOTE.
 
 Following
our initial public offering, our founding stockholders (including all of our
officers and directors) collectively owned 17.9% of our issued and
outstanding shares of common stock. Taking into account the warrants issued on
May 21, 2008, they have the potential to increase that percentage to 20% of our
outstanding shares without any additional expenditure of funds. None of our
founding stockholders, officers and directors has indicated to us that he
intends to purchase additional securities in the open market, but they are not
precluded from doing so. Any shares of common stock acquired by founding
stockholders in our initial public offering or the aftermarket will be
considered part of the holding of the public stockholders and will have the same
rights as other public stockholders, including voting and redemption rights with
respect to a potential business combination. However, they have agreed to vote
such shares of common stock in accordance with the majority of the shares of
common stock voted by the public stockholders.
 
 Because
InterAmerican Capital Partners II LLC and affiliates and one of our special
advisors purchased $1,500,000 of warrants from us in a private placement
completed contemporaneously with the initial public offering and received
additional warrants on May 21, 2008, certain of our founding
stockholders have an even larger ownership block of our common stock upon
exercise of the warrants which could permit them to effectively influence the
outcome of all matters requiring approval by our stockholders at such time,
including the election of directors and approval of significant corporate
transactions, following the consummation of our initial business
combination.
 20
 Table of Contents
 Our board
of directors is divided into three classes, each of which will generally serve
for a term of two years with only one class of directors being elected in each
year. It is unlikely that there will be an annual meeting of stockholders to
elect new directors prior to the consummation of a business combination, in
which case all of the current directors will continue in office at least until
the consummation of the business combination. If there is an annual meeting, as
a consequence of our ‘‘staggered’’ board of directors, only a minority of the
board of directors will be considered for election and our founding
stockholders, because of their ownership position, will have considerable
influence regarding the outcome. Accordingly, our founding stockholders will
continue to exert control at least until the consummation of a business
combination. In addition, our founding stockholders and their affiliates and
relatives are not prohibited from purchasing units in the open market. If they
do, we cannot assure you that our founding stockholders will not have
considerable influence upon the vote in connection with a business
combination.
 
 IF
OUR COMMON STOCK BECOMES SUBJECT TO THE SECURITIES AND EXCHANGE COMMISSION’S
PENNY STOCK RULES, BROKER-DEALERS MAY EXPERIENCE DIFFICULTY IN COMPLETING
CUSTOMER TRANSACTIONS AND TRADING ACTIVITY IN OUR SECURITIES MAY BE ADVERSELY
AFFECTED.
 
 If at any
time we have net tangible assets of $5,000,000 or less and our common stock has
a market price per share of less than $5.00, transactions in our common stock
may be subject to the “penny stock” rules promulgated under the Securities
Exchange Act of 1934, as amended. Under these rules, broker-dealers who
recommend such securities to persons other than institutional accredited
investors must:
 
 •
              make
      a special written suitability determination for the
    purchaser;
 •
              receive
      the purchaser’s written agreement to a transaction prior to
      sale;
 •
                provide
      the purchaser with risk disclosure documents that identify certain risks
      associated with investing in “penny stocks” and that describe the market
      for these “penny stocks” as well as a purchaser’s legal remedies;
      and
 •
                obtain
      a signed and dated acknowledgment from the purchaser demonstrating that
      the purchaser has actually received the required risk disclosure document
      before a transaction in a “penny stock” can be
  completed.
 
 If our
common stock becomes subject to these rules, broker-dealers may find it
difficult to effectuate customer transactions and trading activity in our
securities may be adversely affected. As a result, the market price of our
securities may be depressed, and you may find it more difficult to sell our
securities.
 
 OUR
SECURITIES ARE QUOTED ON THE OTC BULLETIN BOARD, WHICH MAY LIMIT THE LIQUIDITY
AND PRICE OF OUR SECURITIES MORE THAN IF OUR SECURITIES WERE QUOTED OR LISTED ON
THE NASDAQ STOCK MARKET OR ANOTHER NATIONAL EXCHANGE.
 
 Our
securities are traded in the over-the-counter market and are quoted on the OTC
Bulletin Board, an NASD-sponsored and operated inter-dealer automated
quotation system for equity securities not included on The NASDAQ Stock Market.
Quotation of our securities on the OTC Bulletin Board may limit the liquidity
and price of our securities more than if our securities were quoted or listed on
The NASDAQ Stock Market or another national exchange. We cannot assure you that
our securities will continue to be traded on the OTC Bulletin Board in the
future or following the completion of a business combination. If the Company
were to lose the right to have its securities traded on the OTC Bulletin Board,
we could face significant material adverse consequences, including
a:
 
 •
                more
      limited availability of market quotations for our
    securities;
 •
                determination
      that our common stock is a “penny stock,” which would require brokers
      trading in our common stock to adhere to more stringent rules and possibly
      resulting in a reduced level of trading activity in the secondary trading
      market for our common stock;
 •
                more
      limited amount of news and analyst coverage for our
    Company;
 •
                decreased
      ability to issue additional securities or obtain additional financing in
      the future; and
 •
                decreased
      ability of our stockholders to sell their securities in certain
      states.
 
 OUR DIRECTORS MAY NOT BE CONSIDERED
‘‘INDEPENDENT’’ UNDER THE POLICIES OF THE NORTH AMERICAN SECURITIES
ADMINISTRATORS ASSOCIATION, INC. AND WE THUS MAY NOT HAVE THE BENEFIT
OF INDEPENDENT DIRECTORS EXAMINING OUR FINANCIAL STATEMENTS AND THE PRIORITY OF
EXPENSES INCURRED ON OUR BEHALF SUBJECT TO REIMBURSEMENT.
 
 Although
each of our directors owns shares of our common stock, no salary or other
compensation will be paid to our directors for services rendered by them on our
behalf prior to or in connection with a business combination. Accordingly, we
believe our non-executive directors would be considered ‘‘independent’’ as that
term is commonly used. However, under the policies of the North American
Securities Administrators Association, Inc., an international organization
devoted to investor protection, because each of our directors own shares of our
securities and may receive reimbursement for out-of-pocket expenses incurred by
them in connection with activities on our behalf such as identifying potential
target businesses and performing due diligence on suitable business
combinations, state securities administrators could take the position that all
of such individuals are not ‘‘independent.’’ If this were the case, they would
take the position that we would not have the benefit of any independent
directors examining the propriety of expenses incurred on our behalf and subject
to reimbursement. Additionally, there is no limit on the amount of out-of-pocket
expenses that could be incurred and there will be no review of the
reasonableness of the expenses by anyone other than our board of directors,
which would include persons who may seek reimbursement, or a court of competent
jurisdiction if such reimbursement is challenged. Although we believe that all
actions taken by our directors on our behalf will be in our best interests,
whether or not they are deemed to be ‘‘independent,’’ we cannot assure you that
this will actually be the case. If actions are taken, or expenses are incurred
that are actually not in our best interests, it could have a material
adverse effect on our business and operations.
 
 21
 Table of Contents
 WE
MAY CHOOSE TO REDEEM OUR OUTSTANDING WARRANTS AT A TIME THAT OUR WARRANT HOLDERS
MAY NOT WISH TO EXERCISE THEIR WARRANTS OR MAY NOT HAVE THE FINANCIAL CAPABILITY
TO EXERCISE THEIR WARRANTS.
 
 Subject
to there being a current prospectus under the Securities Act of 1933, as
amended, with respect the shares of common stock issuable upon exercise of the
warrants, we may redeem the warrants issued as a part of our units at any time
after the warrants become exercisable in whole and not in part, at a price of
$.01 per warrant, upon a minimum of 30 days prior written notice of redemption,
if and only if, the last sales price of our common stock equals or exceeds
$10.00 per share for any 20 trading days within a 30 trading day period ending
three business days before we send the notice of redemption. Redemption of the
warrants could force the warrant holders (i) to exercise the warrants and pay
the exercise price therefore at a time when the holders may not wish to do so or
do not have the financial capability to do so, (ii) to sell the warrants at the
then current market price when they might otherwise wish to hold the warrants,
or (iii) to accept the nominal redemption price which, at the time the warrants
are called for redemption, is likely to be substantially less than the market
value of the warrants.
 
 ALTHOUGH
WE ARE REQUIRED TO USE OUR BEST EFFORTS TO HAVE AN EFFECTIVE REGISTRATION
STATEMENT COVERING THE ISSUANCE OF THE SHARES UNDERLYING THE WARRANTS AT THE
TIME THAT OUR WARRANT HOLDERS EXERCISE THEIR WARRANTS, WE CANNOT GUARANTEE THAT
A REGISTRATION STATEMENT WILL BE EFFECTIVE, IN WHICH CASE OUR WARRANT HOLDERS
MAY NOT BE ABLE TO EXERCISE OUR WARRANTS.
 
 Holders
of our warrants will be able to receive shares upon exercise of the warrants
only if (i) a current registration statement under the Securities Act of 1933,
as amended, relating to the shares of our common stock underlying the warrants
is then effective and (ii) such shares are qualified for sale or exempt
from qualification under the applicable securities laws of the states in which
the various holders of warrants reside. Although we have agreed in the warrant
agreement, and therefore have a contractual obligation, to use our best efforts
to maintain a current registration statement covering the shares underlying the
warrants following completion of our initial public offering to the extent
required by federal securities laws, and we intend to comply with such
agreement, we cannot assure that we will be able to do so. If we fail to
register the shares of common stock underlying the warrants or have them
qualified for an exemption under the securities laws of the states of residence
of the holders of our warrants, the warrants may be deprived of any value and
the market for the warrants may be limited. In such a circumstance, we are not
obligated to pay cash or other consideration to the holders of the warrants and
the warrants could become worthless and later expire unexercised and
unredeemed.
 
 In
addition, we have agreed to use our reasonable efforts to register the shares
underlying the warrants under the blue sky laws of the states of residence of
the exercising warrant holders, to the extent an exemption is not available and
if permitted by the blue sky laws of such jurisdictions. However, some states
may not permit us to register the shares issuable upon exercise of our warrants
for sale. The value of the warrants will be greatly reduced if a registration
statement covering the shares issuable upon the exercise of the warrants is not
kept current or if the securities are not qualified, or exempt from
qualification, in the states in which the holders of warrants reside. Holders of
warrants who reside in jurisdictions in which the shares underlying the warrants
are not qualified and in which there is no exemption will be unable to exercise
their warrants and would either have to sell their warrants in the open market
or allow them to expire unexercised. If and when the warrants become redeemable
by us, we may exercise our redemption right even if we are unable to qualify the
underlying securities for sale under all applicable state securities
laws.
 
 THE
HOLDERS OF THE WARRANTS PURCHASED IN THE PRIVATE PLACEMENT AND SUBSEQUENTLY
ISSUED IN MAY 2008 MAY EXERCISE THEIR WARRANTS EVEN IF HOLDERS OF THE WARRANTS
PURCHASED IN OUR INITIAL PUBLIC OFFERING MAY NOT BE ABLE TO EXERCISE THEIR
WARRANTS.
 
 Because
the warrants we sold in the private placement to InterAmerican Capital Partners
II LLC (an entity wholly-owned by certain of our officers) and affiliates,
together with one of our special advisors and the warrants issued in May 2008
were issued pursuant to an exemption from the registration requirements under
the federal securities laws, the holders of the warrants will be able to
exercise their warrants even if, at the time of exercise, a prospectus relating
to the common stock issuable upon exercise of such warrants is not current. As a
result, the holders of the warrants purchased in the private placement will not
have any restrictions with respect to the exercise of their warrants. The
holders of the warrants purchased in our initial public offering will not be
able to exercise them unless we have a current registration statement covering
the shares issuable upon their exercise. As a result, the exercise of the
warrants issued in the private placement would have a dilutive effect on the
warrants purchased in our initial public offering and could cause the price of
our common stock to drop below the exercise price of the warrants and cause the
trading price of the warrants to decline or make the warrants
worthless.
 
 22
 Table of Contents
 RISKS
ASSOCIATED WITH OPERATING A TARGET BUSINESS IN A FOREIGN COUNTRY, ALL OF WHICH
WOULD APPLY TO THE PROPOSED SING KUNG TRANSACTION.
 
 IF
SOCIAL UNREST, ACTS OF TERRORISM, REGIME CHANGES, CHANGES IN LAWS AND
REGULATIONS, POLITICAL UPHEAVAL, OR POLICY CHANGES OR ENACTMENTS OCCUR IN A
COUNTRY IN WHICH WE MAY OPERATE AFTER WE EFFECT A BUSINESS COMBINATION, IT MAY
RESULT IN A NEGATIVE IMPACT ON OUR BUSINESS.
 
 Political
events in another country may significantly affect our business, assets or
operations. Social unrest, acts of terrorism, regime changes, changes in laws
and regulations, political upheaval, and policy changes or enactments could
negatively impact our business in a particular country.
 
 ANY
DEVALUATION IN CURRENCIES, HIGH LEVELS OF INFLATION OR INCREASE IN INTEREST
RATES IN A COUNTRY IN WHICH WE MAY OPERATE AFTER WE EFFECT A BUSINESS
COMBINATION COULD NEGATIVELY IMPACT OUR RESULTS OF OPERATIONS AND COULD CAUSE
THE COST OF A TARGET BUSINESS AS MEASURED IN DOLLARS TO
INCREASE.
 
 After we
effect a business combination, our business may be significantly affected by the
general condition of another country’s economy, including, among other things,
the rate of inflation, interest rates, and exchange rates for, or exchange
controls affecting, local currencies. Decreases in the growth rate of a
country’s economy, periods of negative growth and/or increases in inflation or
interest rates may result in lower demand for products, lower real pricing of
our products or a shift to lower margin products. To the extent that a large
percentage of our costs and expenses are fixed, we may not be able to reduce
costs and expenses upon the occurrence of any of these events, and our profit
margins may suffer as a result.
 
 A
substantial increase in a country’s inflation rate could have the effect of
increasing our costs, including salaries, raw materials and supplies, purchased
services and other costs denominated in local currency, which could adversely
affect our results of operations and financial condition. High levels of
inflation may also affect the balance of trade between the United States and the
country at issue, which could also adversely affect our results of
operations.
 
 Currency
fluctuations may have an adverse effect on our financial position, results of
operations and cash flows in future periods. Marked depreciation or appreciation
of the local currency relative to the U.S. dollar could increase costs in the
U.S. or in another country or expose us to risk with respect to our assets and
liabilities denominated in a particular currency, and thereby may negatively
affect our financial position and results of operations. A severe devaluation or
depreciation of a local currency may also result in disruption of the
international foreign exchange markets and may limit our ability to transfer or
to convert such currency into U.S. dollars for the purpose of making timely
payments of interest and principal on any U.S. dollar-denominated debt or
obligations in other currencies.
 
 BECAUSE
OF THE COSTS AND DIFFICULTIES INHERENT IN MANAGING CROSS-BORDER BUSINESS
OPERATIONS, OUR RESULTS OF OPERATIONS MAY BE NEGATIVELY
IMPACTED.
 
 Managing
a business, operations, personnel or assets in another country is challenging
and costly. Any management that we may have (whether based abroad or in the
U.S.) may be inexperienced in cross-border business practices and unaware of
significant differences in accounting rules, legal regimes and labor practices.
In addition, language difficulties and technological barriers, such as issues
relating to computer and phone systems, can greatly exacerbate the problems that
result from this lack of experience. Even with a seasoned and experienced
management team located in both the U.S. and any country in which we may acquire
a business or move its operations, the costs and difficulties inherent in
managing cross-border business operations, personnel and assets can be
significant (and much higher than in a purely domestic business) and may
negatively impact our financial and operational performance.
 23
 Table of Contents
 BECAUSE
MANY COUNTRIES HAVE DIFFICULT AND UNPREDICTABLE LEGAL SYSTEMS AND UNDERDEVELOPED
LAWS AND REGULATIONS THAT ARE UNCLEAR AND SUBJECT TO CORRUPTION AND
INEXPERIENCE, IT MAY ADVERSELY IMPACT OUR RESULTS OF OPERATIONS AND FINANCIAL
CONDITION.
 
 Many
countries have difficult and unpredictable legal systems and underdeveloped laws
and regulations that are unclear and subject to corruption and inexperience. Our
ability to seek and enforce legal protections, including with respect to
intellectual property and other property rights, or to defend ourselves with
regard to legal actions taken against us in a given country, may be difficult or
impossible, which could adversely impact our operations, assets or financial
condition. Rules and regulations in many countries are often ambiguous or open
to differing interpretation by responsible individuals and agencies at the
municipal, state, regional and federal levels. The attitudes and actions of such
individuals and agencies are often difficult to predict and inconsistent. Delay
with respect to the enforcement of particular rules and regulations, including
those relating to customs, tax, environmental and labor, could cause serious
disruption to operations abroad and negatively impact our
results.
 
 IF
RELATIONS BETWEEN THE UNITED STATES AND A FOREIGN GOVERNMENT DETERIORATE, IT
COULD CAUSE POTENTIAL TARGET BUSINESSES OR THEIR GOODS AND SERVICES TO BECOME
LESS ATTRACTIVE.
 
 The
relationship between the United States and foreign governments is subject to
sudden fluctuation and periodic tension. For instance, the United States may
announce its intention to impose quotas on certain imports. Such import quotas
may adversely affect political relations between the two countries and result in
retaliatory countermeasures by the foreign government in industries that may
affect our ultimate target business. Changes in political conditions in foreign
countries and changes in the state of U.S. relations with such countries are
difficult to predict and could adversely affect our operations or cause
potential target businesses or their goods and services to become less
attractive. Because we are not limited to any specific industry, there is no
basis for investors in our initial public offering to evaluate the possible
extent of any impact on our ultimate operations if relations are strained
between the United States and a foreign country in which we acquire a target
business or move our principal manufacturing operations.
 
 IF
WE DETERMINE TO CHANGE DOMICILES IN CONNECTION WITH A BUSINESS COMBINATION, THE
NEW JURISDICTION’S LAWS WILL LIKELY GOVERN ALL OF OUR MATERIAL AGREEMENTS AND WE
MAY NOT BE ABLE TO ENFORCE OUR LEGAL RIGHTS.
 
 In
connection with a business combination, we may determine to relocate the home
jurisdiction of our business from Delaware to a jurisdiction outside of the
United States. If we determine to do this, the new jurisdiction’s corporate law
will control our corporate governance requirements and will determine the rights
of our stockholders. The new jurisdiction’s corporate law may provide less
protection to our stockholders than is afforded by Delaware law. In addition,
upon reincorporation, we may become a ‘‘foreign private issuer’’ for purposes of
United States securities laws, which means that we may be subject to less
stringent reporting requirements and that some provisions of the United States
securities laws (such as the proxy rules and the short-swing trading rules)
would not apply to us. In addition, if we were to relocate to a foreign
jurisdiction, whether or not we reincorporate outside the United States, the new
jurisdiction’s laws will likely govern all of our material agreements. We cannot
assure you that the system of laws and the enforcement of existing laws in such
jurisdiction would be as certain in implementation and interpretation as in the
United States. The inability to enforce or obtain a remedy under any of our
future agreements in a new jurisdiction could result in a significant loss of
business, business opportunities or capital. Any such reincorporation will
likely subject us to foreign regulation, including foreign
taxation.
 
 BECAUSE
WE MAY ACQUIRE AN OPERATING BUSINESS OR CONDUCT OPERATIONS OUTSIDE OF THE UNITED
STATES, WE MAY BE UNABLE TO ENFORCE OUR LEGAL RIGHTS AGAINST FOREIGN
PERSONS.
 
 The laws
of a foreign jurisdiction may govern all or many of our material business and
operating agreements. We cannot assure you that we will be able to enforce any
of our material agreements or that sufficient remedies will be available in
applicable foreign jurisdictions. Even if we are able to obtain judgments from a
United States court with regard to a material agreement against a foreign
person, we may not be able to enforce such judgments outside of the United
States. The inability to enforce or obtain a remedy under any of our future
agreements may have a material impact on our future operations. Further, because
certain of our directors reside outside of the United States, it may be
difficult for investors in the United States to effect service of process upon
such directors, to enforce their legal rights under Federal securities laws
against such directors or to enforce judgments of United States courts against
such directors.
 
 ItemlB. Unresolved Staff Comments.
 
 Not
applicable.
 
 Item2. Properties.
 
 We
maintain our principal executive offices at 2918 Fifth Avenue South, Suite 209,
San Diego, California 92103. The cost for this space through September 4, 2009
is included in the $10,000 per month fee InterAmerican Advisors, LLC charged us
for general and administrative services and which commenced on the effective
date of the Offering and continued for a period of 12 months thereafter pursuant
to a letter agreement between us and InterAmerican Advisors, LLC. We believe,
based on rents and fees for similar services in the metropolitan area of San
Diego, that the fee charged by InterAmerican Advisors, LLC is at least as
favorable as we could have obtained from an unaffiliated person. We consider our
current office space adequate for our current operations.
 
 24
 Table of Contents
 Item3. Legal Proceedings.
 
 To the
knowledge of management, there is no litigation currently pending or
contemplated against us or any of our officers or directors in their capacity as
such.
 
 Item4. Submission of Matters to a Vote of Security
Holders.
 
 No
matters were submitted to a vote o f
security holders during the fiscal year ended December 31, 2008.
   25
 Table of Contents
 PART
II
 
 Item5. Market For Registrant’s Common Equity, Related
Stockholder Matters and Issuer Purchases of Equity
Securities.
 
 The
common stock, warrants and units of InterAmerican Acquisition Group, Inc. are
traded in the over-the-counter market and are quoted on the OTC Bulletin Board,
an FINRA -sponsored and operated inter-dealer automated quotation system for
equity securities not included on The NASDAQ Stock Market. Our common stock,
warrants and units trade under the symbols IAQG, IAQGW and IAQGU respectively.
The Company’s units commenced public trading on September 5, 2007 and its common
stock and warrants commenced public trading on September 20,
2007.  The table below sets forth, for the calendar quarters
indicated, the high and low bid prices of the InterAmerican Acquisition Group,
Inc. common stock, warrants and units as reported by NASDAQ. The quotations
merely reflect the prices at which transactions were proposed, and do not
necessarily represent actual transactions.
 
  InterAmerican
      Acquisition Group Inc.Common
      Stock
                                      
                                      
                                      Warrants
                                      
                                      
                                      UnitsHigh
                                      
                                      
                                      Low
                                      
                                      
                                      High
                                      
                                      
                                      Low
                                      
                                      
                                      High
                                      
                                      
                                      Low2007Third
      Quarter
                                      
                                      $
                                      7.20
                                      
                                      
                                      $
                                      7.18
                                      
                                      
                                      $
                                      1.10
                                      
                                      
                                      $
                                      1.00
                                      
                                      
                                      $
                                      8.20
                                      
                                      
                                      $
                                      8.00Fourth
      Quarter
                                      
                                      $
                                      7.28
                                      
                                      
                                      $
                                      7.17
                                      
                                      
                                      $
                                      1.35
                                      
                                      
                                      $
                                      1.07
                                      
                                      
                                      $
                                      8.60
                                      
                                      
                                      $
                                      8.202008First
      Quarter
                                      
                                      $
                                      7.55
                                      
                                      
                                      $
                                      7.24
                                      
                                      
                                      $
                                      2.28
                                      
                                      
                                      $
                                      1.11
                                      
                                      
                                      $
                                      9.80
                                      
                                      
                                      $
                                      8.28Second
      Quarter
                                      
                                      $
                                      7.85
                                      
                                      
                                      $
                                      7.33
                                      
                                      
                                      $
                                      2.05
                                      
                                      
                                      $
                                      1.40
                                      
                                      
                                      $
                                      9.26
                                      
                                      
                                      $
                                      8.70Third
      Quarter
                                      
                                      $
                                      7.80
                                      
                                      
                                      $
                                      7.35
                                      
                                      
                                      $
                                      2.25
                                      
                                      
                                      $
                                      1.15
                                      
                                      
                                      $
                                      9.85
                                      
                                      
                                      $
                                      8.50Fourth
      Quarter
                                      
                                      $
                                      7.35
                                      
                                      
                                      $
                                      6.80
                                      
                                      
                                      $
                                      1.10
                                      
                                      
                                      $
                                      0.13
                                      
                                      
                                      $
                                      8.10
                                      
                                      
                                      $
                                      7.00
  Source:
NASDAQ. Prices shown reflect inter-dealer prices without retail markup, markdown
or commissions if applicable.
 
 The
quantities of our issued and outstanding securities and number of shareholders
of record for each are shown in the table below as of March 27,
2009.
 
  Number
      Issued
                        
                        
                        Number
      ofSecurity Type
                        
                        and Outstanding
                        
                        
                        Holders of RecordCommon
      Stock
                        
                        
                        6,792,170
                        
                        
                        
                        9Warrants
                        
                        
                        6,542,170
                        
                        
                        
                        3Units
                        
                        
                        207,830
                        
                        
                        
                        1
  We
believe that the number of beneficial owners of each of our securities is
substantially greater than the number of record holders, because a large portion
of common stock is held in broker “street names.”
 
 We have
not paid any dividends on our common stock to date and do not intend to pay
dividends prior to the completion of a business combination. The payment of
dividends in the future will be contingent upon our revenues and earnings, if
any, capital requirements and general financial condition subsequent to
completion of a business combination. The payment of any dividends subsequent to
a business combination will be within the discretion of our then board of
directors. It is the present intention of our board of directors to retain all
earnings, if any, for use in our business operations and, accordingly, our board
does not anticipate declaring any dividends in the foreseeable
future.
 
 Recent
Sales of Unregistered Securities
 
 On May
21, 2008, the Company issued to certain of its founding stockholders and one of
its special advisors, warrants to purchase an aggregate of 185,000 shares of its
common stock, pursuant to agreements dated as of May 21, 2008, an amount that
will be reduced to 55,850 shares to comply with Amendment No.1 to the stock
purchase agreement. A copy of the form of agreement with such founding
stockholders was filed on a Form 8-K on May 23, 2008. As a result of the
issuance of the warrants, if such warrants are exercised, the founding
stockholders would have an 18.5% beneficial ownership interest in the Company
after giving effect to the warrant reduction required by the stock purchase
agreement, as amended, and before giving effect to the exercise of the private
placement warrants purchased at the time of the Offering. Under the terms of the
May 21, 2008 warrant agreements, the warrants are immediately exercisable at an
exercise price of $.01 and expire on the earlier of (x) January 31, 2009 if a
business combination is consummated in 2008 or 90 days after the consummation of
a business combination if such business combination occurs in 2009 or (y)
September 4, 2009. The holders of such warrants are restricted from selling or
transferring the warrants, or any common stock underlying such warrants, to any
transferee until September 4, 2009. During such restricted period, no sale or
transfer or other disposition of the warrants, or any common stock underlying
such warrants, can be made except for certain limited exceptions as set forth in
the warrant agreements. The issuance of the warrants on May 21, 2008 was made
pursuant to the exemption from the registration provisions of the Securities
Act, as amended, provided by Section 4(2) of the Securities Act and Regulation D
promulgated thereunder. The warrants and underlying common stock have not been
registered under the Securities Act and may not be offered or sold in the United
States absent registration or an applicable exemption from registration
requirements.
 
 26
 Table of Contents
 During
the period of this annual report, there were no securities authorized for
issuance under any equity compensation plan.
 
 Use
of Proceeds from our Initial Public Offering
 
 The
effective date of our registration statement, which was filed under the
Securities Act (File No. 333-12558), and which related to the initial public
offering of our units, was September 4, 2007.
 
 Item6. Selected Financial Data.
 
 Not
applicable.
 
 Item7. Management’s Discussion and Analysis of Financial
Condition and Results of Operations.
 
 The
following Management’s Discussion and Analysis of Financial Condition and
Results of Operations should be read in conjunction with our financial
statements and the related notes and schedules thereto contained in this Annual
Report on Form 10-K and the Company’s audited financial statements and notes
thereto included in our Final Prospectus filed with the SEC on September 5,
2007, our Quarterly Reports on Form 10-Q filed with the SEC and in our proxy
statement/prospectus on Form S-4, as amended, initially filed with the
Securities and Exchange Commission on August 12, 2008, relating to the Sing Kung
transaction.
 
 We were
formed on May 10, 2005 for the purpose of effecting a merger, capital stock
exchange, asset acquisition or other similar business combination with an
operating business, without limitation to any particular industry or
geographical location, that has a fair market value of at least 80% of our net
assets (all of our assets, including the funds held in the trust account, less
our liabilities, but excluding any funds (net of taxes payable) held in the
trust account for the benefit of the underwriters) at the time of the
acquisition, provided that the target business is not a start-up or
development-stage company or an affiliate of management. We can also satisfy the
requirement that the business combination have a fair market value at least
equal to 80% of our net assets in an acquisition transaction where we acquire
less than a 100% interest in the target business, provided that the fair market
value of the interest in such business or businesses is at least equal to 80% of
our net assets at the time such acquisition transaction is consummated. We
intend to use cash derived from the proceeds of our Offering and concurrent
warrant sale, our capital stock, debt or a combination of cash, capital stock
and debt, to effect such business combination.
 
 Since our
Offering, we were actively searching for a suitable business combination
candidate until we entered into a definitive agreement to acquire Sing Kung
effective May 15, 2008. Subsequent thereto, our activities have been focused
exclusively on completing the steps necessary to consummate the Sing Kung
transaction. We cannot assure investors that we will be able to consummate the
Sing Kung transaction within the allotted time.
 
 We intend
to utilize cash derived from the proceeds of the Offering, the warrant sale and
our capital stock in effecting the Sing Kung transaction. The issuance of
additional shares of our capital stock in connection with this planned
transaction:
 
 •
              will
      significantly reduce the equity interest of our current
      stockholders;
 •
                will
      cause a change in control which may affect, among other things, our
      ability to use our net operating loss carry forwards, if any, and most
      likely also result in the resignation or removal of one or more of our
      present officers and directors;
and
 •
              may
      adversely affect prevailing market prices for our
    securities.
 
 RESULTS
OF OPERATIONS
 
 Through
December 31, 2008, our efforts have been primarily organizational activities,
activities relating to our Offering and active searching for a target company
with which we could effect a business combination and activities related to the
consummation of the Sing Kung transaction. We have neither engaged in any
operations nor generated any operating revenues to date. We currently have no
operating business. Beginning September 10, 2007 (the date of the consummation
of our Offering) until our consummation of a business combination, we expect
interest earned on the Offering proceeds held in our Trust Account to be our
sole source of income.
 
 27
 Table of Contents
 Our net
loss for the twelve months ended December 31, 2008 was ($1,362,727) which
consisted of $761,373 in interest income, offset by $2,124,100 in expenses
consisting of a provision for income taxes ($106,844); costs associated with
maintaining our public filings, corporate standing and stockholder
administrative matters, including: legal and accounting fees ($191,194);
administrative expense related to the trust ($10,910); D&O insurance
($66,454); franchise taxes ($148,250); the InterAmerican Advisors LLC
administrative fee ($83,667); costs associated with pursuing a business
combination ($708,740, of which $637,881 pertains to the proposed Sing Kung
transaction); interest expense ($3,411); investor relations and communications
expense ($7,918); other miscellaneous expenses ($12,852); and $783,860 incurred
during the second quarter as a result of the issuance of options to our
management, directors and a special advisor (as described in the section in Item
11 entitled “Fiscal Year 2008 Stock Option Awards”).
 
 Net
income for the twelve months ended December 31, 2007 was $150,493 which
consisted of: $565,230 in interest income, partially offset by a provision for
income taxes ($100,078); costs associated with maintaining our public filings,
corporate standing and stockholder administrative matters, including legal and
accounting fees ($53,426); administrative expense related to the trust
($11,152); D&O insurance ($21,244); franchise taxes ($149,350); the
InterAmerican Advisors LLC administrative fee ($36,333); costs associated with
pursuing a business combination ($35,722); interest expense ($5,898); investor
relations and communications expense ($548); and other miscellaneous expenses
($986).
 
 The net
proceeds to us from the sale of our Units, after deducting offering expenses of
$1,021,967 and underwriting discounts of $3,560,000 (including $2,070,000 placed
in the Trust Account representing a deferred underwriters’ discount) was
$41,418,033. Additionally, we received $1,500,000 from the contemporaneous sale
of warrants to InterAmerican Capital Partners II, LLC and affiliates and one of
our special advisors. Upon closing of the initial public offering and warrant
sale, including deferred underwriter’s commissions of $2,070,000, $45,160,000
was placed in the Trust Account. The remaining proceeds of $2,340,000 were used
to pay expenses of the Offering and to provide for business, legal and
accounting due diligence on prospective transactions and continuing general and
administrative expenses. To the extent that our capital stock is used in whole
or in part as consideration to effect an initial transaction, the proceeds held
in the Trust Account (excluding the amount held in the Trust Account
representing a portion of the underwriters’ discount) as well as any other net
proceeds not expended will be used to finance the operations of the
target.
 
 At
December 31, 2008, we had cash outside of the Trust Account of $20,773,
investments held in the Trust Account of $45,160,415 plus accrued interest
receivable on those investments of $44,190, prepaid expenses of $19,552,
deferred tax assets of $195,000 and total liabilities of $2,961,263, excluding
shares subject to redemption. Because we have nearly exhausted the funds that we
are permitted to draw from the Trust Account for working capital expenditures,
we have entered into contingency arrangements with various vendors pursuant to
which they will be paid upon consummation of a business combination. We estimate
that with such contingent payment arrangements, the funds available to us
outside of the Trust Account as of December 31, 2008 (including an additional
$76,900 in after-tax interest that we are permitted to draw from the Trust
Account) are sufficient to allow us to operate through approximately June 2009
and to consummate the Sing Kung transaction. We anticipate using the remaining
funds to cover legal and accounting fees, and other expenses attendant to the
consummation of the Sing Kung transaction. However, if we are not able to
consummate the Sing Kung transaction by approximately June 2009, we will not
have sufficient funds to continue to operate the business or to pursue a
business combination without raising additional capital. If we lack sufficient
funds to continue operations we may be forced to liquidate before we can
complete a business combination. Our estimates of the time that we will be able
to continue to operate may not be accurate. We do not believe we will need to
raise additional funds in order to meet the expenditures required to complete
the Sing Kung transaction and have taken no actions to raise additional funds.
However, if additional funds are required and we are unable to secure additional
financing, the Company would most likely fail to consummate a business
combination in the allotted time and would be forced to liquidate the Trust
Account as part of any plan of dissolution and distribution approved by the
Company’s stockholders.
 
 In
addition, we may need to raise additional funds through a private offering of
debt or equity securities if such funds are required to consummate an initial
transaction that is presented to us. Subject to compliance with applicable
securities laws, we would only anticipate consummating such a fund-raising
simultaneously with the consummation of an initial transaction.
 
 CHANGES
IN FINANCIAL CONDITION
 
 Liquidity
and Capital Resources
 
 On
September 4, 2007 we sold 1,000,000 warrants in a private placement to
InterAmerican Capital Partners II, LLC and affiliates and one of our Special
Advisors. Each warrant entitles the holder to purchase from us one share of our
common stock at an exercise price of $5.00.The warrants were sold at a
price of $1.50 per warrant, generating net proceeds of $1,500,000.
 
 On
September 10 and 11, 2007 we consummated the Offering of 5,750,000 Units. Each
unit consists of one share of common stock and one warrant. Each warrant
entitles the holder to purchase from us one share of our common stock at an
exercise price of $5.00.
 
 28
 Table of Contents
 The net
proceeds to us from the sale of our Units, after deducting offering expenses of
$1,021,967 (some of which were not paid at closing) and underwriting discounts
of $3,560,000 (including $2,070,000 placed in the Trust Account representing a
deferred underwriters’ discount) was $41,418,033. Additionally, we received
$1,500,000 from the contemporaneous sale of warrants to InterAmerican Capital
Partners II, LLC and affiliates and one of our special advisors. Prior to
completion of the Offering, InterAmerican Advisors, LLC, a company owned by our
management, loaned us an aggregate of $141,000 for payment of offering expenses
on our behalf. These advances, together with interest of approximately $12,678
were repaid on September 10, 2007 from the proceeds of the initial public
offering that were allocated to pay offering expenses. $45,160,000 plus
after-tax interest income earned on that amount (less up to $950,000 of such
after-tax income which may be released to the Company upon demand) is being held
in a Trust Account at JP Morgan Chase Bank, N.A. maintained by Continental Stock
Transfer & Trust Company, as trustee and the remaining funds (including up
to $950,000 of after-tax income on the funds held in the Trust Account that may
be released to the Company) are held outside of the Trust Account. Funds outside
the Trust Account are available to be used by us to provide for business, legal
and accounting due diligence on prospective acquisitions and continuing general
and administrative expenses. As of December 31, 2008, we had drawn $873,100 (of
the $950,000 permitted) from the interest earned net of taxes on the Trust
Account; we had a cash balance of $20,773; and $8,484 of the expenses incurred
to complete the Offering remained unpaid.
 
 Because
we have nearly exhausted the funds we are permitted to draw for working capital,
we have had to enter into contingent payment arrangements with various vendors
in order to meet the requirements necessary to consummate a business combination
with Sing Kung. Pursuant to those arrangements, participating vendors will be
paid upon consummation of a business combination. Utilizing this mechanism we
believe that we will have sufficient funds to complete the Sing Kung transaction
if it can be consummated before approximately June 2009, however there can be no
assurance that the resources available to us will be sufficient for this
purpose. If not, we will be forced to raise additional capital or be forced to
liquidate. We have not identified any sources of additional capital and there is
no assurance that we would be able to obtain such additional capital if
required.
 
 If we are
unable to proceed with the Sing Kung transaction, we may not have a sufficient
amount of working capital available outside of the trust account to conduct due
diligence and pay other expenses related to finding another suitable business
combination without securing additional financing. We cannot assure you that
such financing would be available on acceptable terms, if at all. To the extent
that additional financing proves to be unavailable if and when needed to
consummate a particular business combination, we would be compelled to
liquidate.
 
 If the
Company is forced to liquidate, it would result in a loss of a portion of your
investment. None of our officers, directors or stockholders is required to
provide any financing to us in connection with or after a business
combination.
 
 Over the
time period from December 31, 2008 to September 5, 2009, we currently anticipate
incurring expenses for the following purposes:
 
 •
                legal,
      accounting and other expenses attendant to consummating the Sing Kung
      transaction;
 •
                legal
      and accounting fees relating to our SEC reporting obligations and general
      corporate matters;
 •
                administrative
      fees; and
 •
                working
      capital, director and officer liability insurance premiums and
      reserves.
 
 We expect
to use all or substantially all of the proceeds held in trust other than the
deferred portion of the underwriter’s fee to acquire Sing Kung, although there
is no assurance that we will be successful in doing so.
 
 If we are
unable to consummate the Sing Kung transaction or another suitable business
combination by September 4, 2009 (or such earlier time as our working capital
funds are exhausted), we will be forced to liquidate. If we are forced to
liquidate, the per share liquidation amount may be less than the initial per
unit price in the Offering because of the underwriting commissions and expenses
related thereto and because of the value of the warrants in the per unit
offering price. Additionally, if third parties make claims against us, the funds
held in the Trust Account could be subject to those claims, resulting in a
further reduction to the per share liquidation price. Under Delaware law, our
stockholders who have received distributions from us may be held liable for
claims by third parties to the extent such claims are not been paid by us.
Furthermore, our warrants will expire worthless if we liquidate before the
completion of a business combination.
 
 Off-Balance
Sheet Arrangements
 
 Options
and warrants issued in conjunction with our Offering are equity-linked
derivatives and accordingly represent off-balance sheet arrangements. The
options and warrants meet the scope exception in paragraph 11(a) of FAS 133 and
are accordingly not accounted for as derivatives for purposes of FAS 133, but
instead areaccounted for
as equity. For a more complete discussion of the treatment of the warrants, see
footnote 6 to the financial statements.
 
 Other
than contractual obligations incurred in the normal course of business, we do
not have any off-balance sheet financing arrangements or liabilities, guarantee
contracts, retained or contingent interests in transferred assets or any
obligation arising out of a material variable interest in an unconsolidated
entity. The securities held in the Trust Account are in the name of
InterAmerican Acquisition Group, Inc.
 
 29
 Table of Contents
 Contractual
Obligations
 
 In
connection with our Offering, Chardan Capital Markets LLC (“CCM”) (on behalf of
the underwriters) has agreed to defer payment of ($2,070,000) until completion
of a business combination. Until a business combination is complete, these funds
will remain in the Trust Account. If the Company does not complete a business
combination then the underwriters’ deferred fee will become part of the funds
returned to the Company’s Public Stockholders from the Trust Account upon its
liquidation as part of any plan of dissolution and distribution approved by the
Company’s stockholders.
 
 On
September 4, 2008, the Company entered into a definitive agreement to engage CCM
to advise the Company and provide various support services in connection with
the acquisition of Sing Kung. The support services to be provided by CCM include
advising on valuation and planning matters that may arise related to the
acquisition of Sing Kung after the effective date of the agreement with CCM,
assisting with the structuring of the terms of future amendments to the Sing
Kung transaction (if any), arranging meetings with investors that CCM determines
are likely to be interested in owning or acquiring the securities of the Company
or the combined companies following the Sing Kung transaction, facilitating
introductions to research organizations to increase awareness about the Company
and the Sing Kung transaction, leveraging CCM’s relationships with other
financial institutions to provided needed finance strategy and support and such
other matters in related to the Sing Kung transaction that the Company and CCM
agree.
 
 Subject
to certain early termination rights of the Company and CCM, the engagement
period extends through September 5, 2009. If the Sing Kung transaction is
consummated, the engagement period extends for two years and the scope of the
engagement is revised to focus on the provision of advice by CCM regarding
future funding and securities matters of the combined companies.
 
 Compensation
of CCM is contingent on consummation of the Sing Kung transaction and has been
set as 0.5% of the market capitalization of the combined companies for the 10
trading days prior to and following the closing of the Sing Kung transaction
plus an additional amount equal to 0.15% of the market capitalization of the
combined companies if the share price of the combined companies exceeds $10 per
share during the 10 trading days following the closing of the Sing Kung
transaction. In addition, CCM is entitled to reimbursement of certain reasonable
expenses incurred in the performance of the engagement. The compensation for
services following consummation of the Sing Kung transaction shall be as
mutually agreed by CCM and the combined company.
 
 The
agreement described above was approved by the board of directors of the Company
in a meeting held on August 26, 2008, subject to negotiation of final terms by
CCM and the Company’s management.
 
 Other
than contractual obligations incurred in the ordinary course of business and an
agreement with InterAmerican Advisors, LLC to provide offices and administrative
services through September 4, 2009 for total consideration of up to $120,000, we
do not have any other material long-term contractual obligations.
 
 Item7A. Quantitative and Qualitative Disclosures About Market
Risk.
 
 Not
applicable.
 
 Item8. Financial Statements and Supplementary Data.
 
 Reference
is made to pages F-l through F-14 comprising a portion of this Annual Report on
Form 10-K.
 
 Item9. Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure.
 
 None.
 
 Item9A. Controls and Procedures.
 
 Disclosure
Controls and Procedures
 
 Our
management carried out an evaluation, with the participation of William C.
Morro, our principal executive and financial officer, of the effectiveness of
our disclosure controls and procedures as of December 31, 2008. Based upon that
evaluation, Mr. Morro concluded that our disclosure controls and procedures were
effective to ensure that information required to be disclosed by us in reports
that we file or submit under the Exchange Act is recorded, processed, summarized
and reported, within the time periods specified in the rules and forms of the
SEC.
 
 30
 Table of Contents
 Internal
Control Over Financial Reporting
 
 Management
is responsible for establishing and maintaining adequate internal control over
financial reporting. Our internal control over financial reporting is a process
designed by, or under the supervision of, our chief executive and chief
financial officer and effected by our board of directors, management and other
personnel, to provide reasonable assurance regarding the reliability of our
financial reporting and the preparation of our financial statements for external
purposes in accordance with generally accepted accounting principles (United
States). Internal control over financial reporting includes policies and
procedures that pertain to the maintenance of records that in reasonable detail
accurately and fairly reflect the transactions and dispositions of our assets;
provide reasonable assurance that transactions are recorded as necessary to
permit preparation of our financial statements in accordance with generally
accepted accounting principles (United States), and that our receipts and
expenditures are being made only in accordance with the authorization of our
board of directors and management; and provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use or disposition
of our assets that could have a material effect on our financial
statements.
 
 A control
system, no matter how well conceived and operated, can provide only reasonable,
not absolute, assurance that the objectives of the control system are met.
Because of the inherent limitations in all control systems, no evaluation of
controls can provide absolute assurance that all control issues and instances of
fraud, if any, within a company have been detected. Our disclosure controls and
procedures are designed to provide reasonable assurance of achieving its
objectives. Our principal executive and financial officer concluded that our
disclosure controls and procedures are effective at that reasonable assurance
level.
 
 Our chief
executive and financial officer conducted an evaluation of the effectiveness of
the Company's internal control over financial reporting as of December 31, 2008
based on the framework set forth in the Internal Control - Integrated Framework
issued by the Committee of Sponsoring Organizations of the Treadway Commission.
Based upon his evaluation, he concluded that the Company's internal control over
financial reporting was effective as of December 31, 2008.
 
 This
annual report does not include an attestation report of the Company’s registered
public accounting firm regarding internal control over financial reporting.
Management's report was not subject to attestation by the Company's registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit the Company to provide only management’s report
in this annual report.
 
 There has
not been any change in our internal control over financial reporting in
connection with the evaluation required by Rule 13a-15 and 15d-15 under the
Exchange Act that occurred during the most recently completed fiscal quarter
that has materially affected, or is reasonably likely to materially affect, our
internal control over financial reporting.
 
 Item9B. Other Information.
 
 Not
applicable.
 
 31
 Table of Contents
 PART
III
 
 Item10. Directors, Executive Officers and Corporate
Governance.
 
 Our
current directors and executive officers are as follows:
  Name
                                Age
                                PositionWilliam
      C. Morro
                                55
                                Chairman,
      Chief Executive and Chief Financial OfficerRichard
      N. Sinkin, PhD
                                65
                                Chief
      Operating Officer, Secretary and DirectorJames
      Bazet
                                61
                                DirectorDr.
      Herminio A. Blanco Mendoza
                                56
                                DirectorRichard
      M. Wolfson
                                41
                                Director
  William C.
Morro has served as chairman of the board and chief executive officer
since our inception and as our chief financial officer since December 5, 2005.
Since November 2001, Mr. Morro has been a partner with the InterAmerican Group,
an advisory and investment firm focusing on cross-border transactions. In
October 1996, Mr. Morro founded the U.S. Merchant Bank for the Bank of Montreal
Group of Companies – BMO Nesbitt Burns Equity Group (US), Inc. and was its
president until October 2001. From 1991 to 1996, Mr. Morro was employed by
Heller Financial, Inc., and from June 1994 to October 1996 served as president
of its SBIC, Heller Investments, Inc. (HII). Since 1991, Mr. Morro has
accumulated experience with the acquisition and management of middle-market
companies, having participated as an investment principal in 55 acquisition or
divestiture transactions. Prior to joining HII, Mr. Morro was a principal and
shareholder of the general management consulting firm, Cresap, McCormick and
Paget (now owned by Towers, Perrin). Before joining Cresap, Mr. Morro
worked for two years as a Development Engineer for Union Carbide Corporation and
he earned a Masters degree from the Kellogg Graduate School of Management at
Northwestern University. His undergraduate degree is from Dartmouth College,
where he studied chemistry and engineering.
  Dr. Richard N.
Sinkin has served as chief operating officer and a member of our board of
directors since our inception and as our secretary since December 5, 2005. From
2000 until the present, Dr. Sinkin has acted as the managing partner of
Strategies International d/b/a InterAmerican Holdings. In 2002, Dr. Sinkin
officially became a partner in the InterAmerican Group, providing advisory and
consulting services and equity financing to middle market companies interested
in cross-border projects. In 1987 Dr. Sinkin founded InterAmerican Holdings Co.,
an international consulting business and predecessor to the InterAmerican Group.
From June 1987 to October 2000, Dr. Sinkin was the president of Strategies
International. Strategies International d/b/a InterAmerican Holdings was founded
in 1987 and is the predecessor company to InterAmerican Advisors. It provides
international business consulting services to companies and institutions seeking
to establish a marketing or manufacturing presence in Latin America. It also
assists certain non-profit organizations, such as the University of California
San Diego, in the development of their international educational programs. He is
a specialist in setting up offshore manufacturing operations, particularly in
Mexico, where he has directed the start-up of 27 factories. Prior to forming
InterAmerican, Dr. Sinkin, who holds his doctorate degree in Latin American
history, was the vice president of the Institute of the Americas in La Jolla,
California, a center of private and public sector collaboration on Latin
American business issues. From 1982 to 1985, Dr. Sinkin was a director of Texas
Bank in San Antonio, Texas. From 1981 to 1986, he was the executive director of
the Latin American Studies Association. In 1979, he was appointed Senior Policy
Analyst at the U.S. Department of State, Agency for International Development.
From 1969 to 1986, Dr. Sinkin was a professor of Latin American history at the
University of Texas at Austin. Dr. Sinkin is an elected member of the
Council on Foreign Relations in New York, the Pacific Council on International
Policy in Los Angeles, and the San Diego Dialogue in San Diego. He serves on the
board of directors of the Immigration Museum of New Americans in San Diego, and
the International Advisory Boards of two University of California San Diego
organizations: the Graduate School of International Relations and Pacific
Studies and the Center for US-Mexican Studies. He received a B.A., M.A., and
Ph.D. from the University of Michigan.
  James
Bazet has served as a member of our board of directors since our
inception. Mr. Bazet has been the chairman of the board, president, chief
executive officer and a director of Cobra Electronics Corporation, a public
company based in Chicago with offices in Hong Kong and Ireland, since 1998.
Cobra designs and markets products primarily for consumer markets in North
America and Europe. Under Mr. Bazet’s leadership, Forbes Magazine named Cobra
one of theBest 200 Small
Companies in America in both 2000 and 2001. Since becoming president and
chief executive officer of Cobra in 1998, Mr. Bazet has overseen global sourcing
of the company’s products, particularly in Asia, as well as of distribution into
new markets for the company in Europe. Prior to assuming leadership of Cobra,
Mr. Bazet served as chief operating officer of Ryobi America from 1994 to 1998
and as chief executive officer of Code-A-Phone Corporation from 1991 to 1994.
Mr. Bazet received a B.S. degree in Finance from Nicholls State University in
Louisiana.
  32
 Table of Contents
  Dr. Herminio A.
Blanco Mendoza has served as a member of our board of directors since our
inception. Dr. Blanco has been the chief executive officer of Soluciones
Estrategicas, an international consulting firm based in Mexico City that
specializes in advising multinational clients on international trade and
investment issues, since January 2002. Since April 2004, he has been a member of
the Board of Directors of Banco Latino Americano de Exportaciones (listed on the
NYSE as BLADEX), CYDSA (a Mexican chemical and textile manufacturing group), and
BANORTE. During 2001, prior to founding Soluciones Estrategicas, Dr. Blanco
advised governments and corporations on international trade issues. He served as
Secretary of Commerce and Industrial Development for Mexico for the entire term
of the Zedillo administration (1994 – 2000). Before 1994 he served under three
presidential administrations in federal level Mexican government positions
including: Chief Negotiator of NAFTA, Undersecretary of International Trade and
Economic Advisor to the President. Dr. Blanco has held academic teaching
positions at Rice University, Instituto Tecnológico Autónomo de México and El
Colegio de México. He received his undergraduate degree (B.A. in Economics) from
Instituto Tecnológico de Estudios Superiores de Monterrey and was awarded a
Masters and Ph.D. in Economics from the University of Chicago.
  Richard M.
Wolfson has served as a member of our board of directors since our
inception. From inception until December 5, 2005, Mr. Wolfson also served as our
chief financial officer and secretary. Mr. Wolfson has been actively executing
or guiding investment transactions for the bulk of his professional career.
Since January 31, 2006, Mr. Wolfson has served as vice president, general
counsel and secretary of Clarcor Inc., a public company listed on the New York
Stock Exchange. In July 2001, Mr. Wolfson joined with Mr. Morro and Dr.
Sinkin (former clients) to form the InterAmerican Group. Prior to joining
InterAmerican, from April 2000 to July 2001 Mr. Wolfson served as EVP of
Business Development for Education Networks of America, a provider of internet
services to K-12 public schools. From July 1991 to April 2000, Mr. Wolfson was a
partner with the Chicago office of Baker & McKenzie, where Mr. Wolfson
specialized in M&A and complex cross-border transactions for numerous public
and private company clients, with a focus on Latin America and Europe.
Mr. Wolfson received his undergraduate degree from Colgate University and
holds a JD with distinction from Northwestern University School of
Law.
  We have
fixed the number of our board of directors at six. Five of the board positions
are filled by Messrs. Morro, Sinkin, Bazet, Blanco, and Wolfson and one position
is vacant. We had intended to fill the current vacancy in our board of directors
by December 31, 2007, but our board has elected to postpone doing so until a
business combination candidate has been identified and we can recruit an
individual with relevant experience to the position. Our board of directors is
divided into three classes with only one class of directors being elected in
each year and each class serving a three-year term. The term of office of the
first class of directors, consisting of Dr. Herminio A. Blanco Mendoza, will
expire at our first annual meeting of stockholders. The term of office of the
second class of directors, consisting of Mr. Bazet and Mr. Wolfson, will expire
at the second annual meeting. The term of office of the third class of
directors, consisting of Mr. Morro and Dr. Sinkin, will expire at the third
annual meeting.
  Our board
has participated in identifying and evaluating prospective business combination
candidates, selecting the target business, and guiding the structuring,
negotiating and consummating its acquisition. None of these individuals has been
a principal of or affiliated with a public company or blank check company that
executed a business plan similar to our business plan and none of these
individuals is currently affiliated with such an entity. However, we believe
that the skills and expertise of these individuals, their collective access to
acquisition opportunities and ideas, their contacts, and their transaction
expertise should enable them to identify and effect an acquisition although we
cannot assure you that they will, in fact, be able to do so.
 
 Special
advisors
 
 As
described below, our special advisors are experienced with blank check companies
that have completed offerings similar to the Offering. They have agreed to treat
our proprietary information confidentially and to be reasonably available on
request to advise our board of directors on matters related to the Offering and
completing a subsequent business combination. Our special advisors purchased
shares of our common stock prior to the Offering, and as described elsewhere in
this prospectus, have agreed to be treated similarly to members of management
and the board of directors with respect to the voting and disposition of those
shares. Our special advisors owe no fiduciary duties to us as officers or
directors or in their capacity as advisors.
 
 Dr. Richard D.
Propper serves as one of our special advisors. Dr. Propper is an officer
and director of several companies that have completed or are pursuing offerings
similar our Offering, including Chardan China North Acquisition Corp,
Chardan China South Acquisition Corp. and Chardan China Acquisition Corp. In
August 2003, he formed: Chardan Capital, LLC, a venture capital management and
financial strategic consulting firm based in Southern California, and has been
one of its managers since its formation. During this time, Dr. Propper has been
focused principally on building business relationships between Chinese and U.S.
companies. In 1984, he founded Montgomery Medical Ventures Funds, an early stage
venture capital firm, and was the managing general partner until July 1993. He
then pursued private investment activities from July 1993 until he formed
Chardan Capital in August 2003. Dr. Propper received a B.S. from
McGill University and an M.D. from Stanford University. He also spent
ten years on the faculty of Harvard medical school as a research fellow and an
assistant professor in pediatrics. Dr. Propper is the father of Kerry Propper,
the Chief Executive Officer of Chardan Capital Markets, LLC, our lead
underwriter.
 33
 Table of Contents
 Steven M.
Oliveira serves as one of our special advisors. Mr. Oliveira has been the
President of Oliveira Capital, LLC since its inception in 2002. Prior to
starting Oliveira Capital, Mr. Oliveira was a venture capitalist and investor in
the biotechnology industry. Mr. Oliveira’s career in biotechnology began in 1992
as a Vice President at D. Blech and Company, an investment bank that specialized
in financing emerging companies in the life sciences sector. In 1995, while a
Managing Partner at CSO Ventures, Mr. Oliveira co-founded Depomed, Inc. and Siga
Pharmaceuticals. Since starting Oliveira Capital, LLC in 2002, Mr. Oliveira has
focused on investments in the biotechnology industry and Special Purpose
Acquisition Companies (SPACs). Mr. Oliveira holds a Bachelor of Arts degree in
Economics from Manhattan College.
 
 Section
16(a) Beneficial Ownership Reporting Compliance
 
 Section
16(a) of the Exchange Act requires our officers, directors and persons who
beneficially own more than ten percent of our common stock to file reports of
ownership and changes in ownership with the SEC. These reporting persons are
also required to furnish us with copies of all Section 16(a) forms they file.
Based solely on its review of the copies of Section 16(a) forms received by it,
the Company believes that all such filing requirements for the year ended
December 31, 2008 were complied with except that one report was filed late by
each of Messrs. Morro, Sinkin, Blanco, Wolfson and Bazet.
 
 Code
of Conduct and Ethics
 
 We have
adopted a code of ethics that applies to our principal executive officer,
principal financial officer, principal accounting officer or controller or any
persons performing similar functions, a copy of which is attached hereto as
Exhibit 14.1.
 
 Director
Independence
 
 Our board
of directors has determined that Messrs. Bazet, Blanco and Wolfson are
“independent directors” within the meaning of Rule IOA-3 promulgated under the
Exchange Act.
 
 Board
Committees
 
 Our board
of directors has an audit committee, a compensation committee and a nominating
and governance committee.
 
 Audit
Committee
 
 Our audit
committee consisted solely of James Bazet and Richard M. Wolfson until February
2008, when Dr. Herminio A. Blanco Mendoza was appointed to the audit committee.
Mr. Bazet serves as the chairman of our audit committee. Messrs. Wolfson, Blanco
and Bazet are each independent directors of our board of directors, as defined
by the rules of the SEC. Our board of directors has determined that Mr. Bazet
qualifies as an “audit committee financial expert,” as such term is defined by
SEC rules.
 
 The audit
committee reviews the professional services and independence of our independent
registered public accounting firm and our accounts, procedures and internal
controls. The audit also approves the firm selected to be our independent
registered public accounting firm, reviews and approves the scope of the annual
audit, reviews and evaluates with the independent public accounting firm our
annual audit and annual consolidated financial statements, reviews with
management the status of internal accounting controls and reimbursement of
management’s out-of-pocket expenses, evaluates problem areas having a potential
financial impact on us that may be brought to the committee’s attention by
management, the independent registered public accounting firm or the board of
directors, and reviews all of our public financial reporting
documents.
 
 Audit
Committee Pre -Approval Policies and Procedures
 
 In
accordance with Section 1OA(i) of the Exchange Act before the Company engages
its independent accountant to render audit or permitted non-audit services, such
engagement is be approved by the board of directors or audit
committee.
 
 Compensation
Committee
 
 We have
established a compensation committee of the board of directors, which consists
of Mr. Wolfson and Mr. Bazet, each of whom is an independent director as defined
by the rules of the SEC. Mr. Wolfson serves as Chairman of the compensation
committee. The compensation committee is responsible for overseeing any
compensation-related matters involving management. It is also responsible for
reviewing and approving any compensation arrangements or conflict-of-interest
matters involving our management that may be negotiated or arise in conjunction
with a business combination. In the event that our compensation committee (which
consists of only two members) becomes deadlocked on any decision within the
scope of its responsibility, the matter is determined by vote of all independent
directors.
 
 34
 Table of Contents
 Nominating
and Governance Committee
 
 We have
established a nominating committee, the members of whom, Messrs. Wolfson, Blanco
and Bazet are each independent directors. The nominating committee is
responsible for overseeing the selection of persons to be nominated to serve on
our board of directors. The nominating committee will consider persons
identified by its members, management, stockholders, investment bankers and
others.
  Conflicts
of Interest
  Potential
investors should be aware of the following potential conflicts of
interest:
 
 •
                None
      of our officers and directors are required to commit their full time to
      our affairs and, accordingly, they may have conflicts of interest in
      allocating their time among various business
  activities.
  •
                In
      the course of their other business activities, our officers and directors
      may become aware of investment and business opportunities which may be
      appropriate for presentation to our Company as well as the other entities
      with which they are affiliated. Our management may have conflicts of
      interest in determining to which entity a particular business opportunity
      should be presented. A complete description of our management’s other
      affiliations are set forth under the beginning of this Item 10 entitled
      “Directors, Executive Officers and Corporate
  Governance.”
  •
                Our
      officers and directors may in the future become affiliated with entities,
      including other blank check companies, engaged in business activities
      similar to those intended to be conducted by our
  Company.
  •
                Since
      our directors own shares of our common stock which will be released from
      escrow only if a business combination is successfully completed, and will
      own warrants which will expire worthless if a business combination is not
      consummated, our board may have a conflict of interest in determining
      whether a particular target business is appropriate to effect a business
      combination. The personal and financial interests of our directors and
      officers may influence their motivation in identifying and selecting a
      target business, completing a business combination timely and securing the
      release of their stock. Our directors and officers were permitted to
      purchase units in the Offering and may continue to purchase units and
      common stock in the open market and will vote these shares in accordance
      with the majority of the shares of common stock voted by the public
      stockholders on a proposal to approve a business combination and exercise
      their redemption rights in connection
therewith.
  •
                The
      terms of any employment or consulting arrangements of our current
      management with the combined company post-business combination will
      be determined at the time management negotiates the terms of the
      business combination with the target business. Since our current
      management will be negotiating the terms of the business
      combination as well as the terms of their employment or
      consulting arrangements, our current management may have a conflict
      of interest in negotiating terms favorable to the Company in the
      acquisition agreement and at the same time negotiating terms in their
      employment or consulting arrangements that are favorable to them.
      Although management intends to fully exercise its fiduciary duty to
      negotiate terms in the acquisition agreement that will be in the
      best interests of the combined-company and its public stockholders,
      members of management will be negotiating terms in their employment
      or consulting agreements that are favorable to
  them.
 
 In
general, officers and directors of a corporation incorporated under the laws of
the State of Delaware are required to present business opportunities to a
corporation if:
 
 •
                the
      corporation could financially undertake the
  opportunity;
 
 •
                the
      opportunity is within the corporation’s line of business;
    and
 
 •
                it
      would not be fair to the corporation and its stockholders for the
      opportunity not to be brought to the attention of the
      corporation.
 
 Accordingly,
as a result of multiple business affiliations, our officers and directors may
have similar legal obligations relating to presenting business opportunities
meeting the above-listed criteria to multiple entities. In addition, conflicts
of interest may arise when our board evaluates a particular business opportunity
with respect to the above-listed criteria. We cannot assure you that any of the
above mentioned conflicts will be resolved in our favor.
 
 In order
to minimize potential conflicts of interest which may arise from multiple
corporate affiliations, each of our officers and directors has agreed, until the
earliest of a business combination, our liquidation or such time as he ceases to
be an officer or director, to present to our Company for our consideration,
prior to presentation to any other entity, any business opportunity which may
reasonably be required to be presented to us under Delaware law, subject to any
pre-existing fiduciary obligations he might have.
 35
 Table of Contents
 It is the
intention of each officer and non-independent director (Mr. Morro and Dr.
Sinkin) to present to us any business opportunities he is made aware of prior to
presenting such opportunity to another entity and such officers and
non-independent directors do not have any pre-existing fiduciary obligations to
any entities that would prohibit this or cause a conflict of interest to exist
with us. Our independent directors (Messrs. Bazet, Blanco and Wolfson) are
subject to pre-existing fiduciary obligations to the entities that they serve as
officers and/or directors and may present opportunities to such entities before
presenting them to us.
 
 Mr. Morro
and Dr. Sinkin are not currently involved in or a part of any private equity
firm or fund other than as limited partners or passive investors with no role in
identifying, selecting or disposing of investments. Instead, Mr. Morro and Dr.
Sinkin, through InterAmerican Advisors, LLC, provide advisory services to U.S.
and Canadian companies that are doing business in Latin America and elsewhere
and to Latin American companies that are doing business in the U.S. and Canada.
Their advisory services consist of evaluating third party arrangements,
conducting due diligence and assisting in the negotiation of cross-border
transactions. In providing these advisory services, Mr. Morro and Dr. Sinkin are
not analyzing target businesses or seeking acquisitions for InterAmerican
Acquisition Group, Inc., instead they are providing advisory services to the
clients of InterAmerican Advisors and in such capacity are precluded from
activities that would conflict with their clients’ interests such as using
information gathered for their own purposes or to benefit us. While Mr. Morro
and Dr. Sinkin have, in the past, invested personally (or through affiliated
entities they have formed for the purpose of holding their investments) in
private equity transactions, and are free to make such direct investments in the
future, they have agreed, as mentioned above, to present to us prior to
presenting such opportunity to another entity any investment or acquisition
opportunities that we are permitted to make or that would be relevant to our
business operations.
 
 None of
Messrs. Bazet, Blanco or Wolfson (the independent directors) is currently
involved in or is a part of any private equity firm or fund. Unlike Mr. Morro
and Dr. Sinkin, none of these independent directors will be actively involved in
seeking an acquisition target on our behalf. As directors of our Company, these
independent directors are expected to become involved in evaluating a potential
acquisition target primarily after management has identified such a potential
opportunity and presented it for them to consider on our behalf. These outside
directors have duties as officers or directors of separate other entities that,
like the duties of Mr. Morro and Dr. Sinkin to the clients of InterAmerican
Advisors, LLC, preclude them from activities or sharing proprietary information
that would conflict with the interests of their employers. Although none of
their roles with their respective entities is focused on identifying and
evaluating acquisitions, if any of the outside directors becomes involved in
evaluating acquisitions or business combinations for these entities, they will
have to maintain the confidentiality of that activity and the information they
may learn would not be made available to us. The possibility exists that one or
more of the independent directors could become aware of a potential acquisition,
other than in connection with their duties as officers and directors of their
respective employers, and could pass that information on to members of our
management.
 
 In
connection with the vote required for any business combination, all of our
founding stockholders, including all of our officers and directors, have agreed
to vote their respective shares of common stock which were owned prior to the
Offering in accordance with the vote of the public stockholders owning a
majority of the shares of our common stock sold in the Offering. Any common
stock acquired by founding stockholders in the Offering or in the after market
will be considered part of the holdings of the public stockholders. These
founding stockholders will have the same rights as other public stockholders
with respect to such shares, including voting and redemption rights in
connection with a potential business combination. However, they will vote such
shares on a proposed business combination in accordance with the majority of the
shares of common stock voted by the public stockholders. In addition, they have
agreed to waive their respective rights to participate in any liquidation
including the liquidation of our trust account as part of our plan of
dissolution and distribution to our public stockholders, as well as to vote for
any plan of dissolution and distribution submitted to our stockholders, but only
with respect to those shares of common stock acquired by them prior to the
Offering.
 
 To
further minimize potential conflicts of interest, we have agreed not to
consummate a business combination with an entity which is affiliated with any of
our founding stockholders. However, after completing our initial business
combination and if we deem it to be in the best interest of our stockholders, we
may enter into a business combination with an affiliate in subsequent business
combinations.
 36
 Table of Contents
 Item11. Executive Compensation.
 
 Executive
Compensation
 
 No
executive officer has received any cash compensation for services rendered.
Commencing on the effective date of the Offering and for the 12 months
thereafter, we paid InterAmerican Advisors, LLC $10,000 per month for use of
office space, utilities, administrative, technology and secretarial services.
InterAmerican Advisors, LLC is owned by our management. This arrangement was
agreed to by InterAmerican Advisors, LLC for our benefit and was not intended to
provide compensation to our management in lieu of salary. We believe, based on
rents and fees for similar services in the San Diego area, that the fee charged
by InterAmerican Advisors, LLC was at least as favorable as we could have
obtained from an unaffiliated third party. Other than the above-described
$120,000 fee, no compensation of any kind, including finder’s and consulting
fees, has been or will be paid to any of our initial stockholders, including our
officers and directors or special advisors, or any of their respective
affiliates, for services rendered prior to or in connection with a business
combination. However, these individuals will be reimbursed for any out-of-pocket
expenses incurred in connection with activities on our behalf such as
identifying potential target businesses and performing due diligence on suitable
business combinations. After a business combination, such individuals may be
paid consulting, management or other fees from target businesses, with any and
all amounts being fully disclosed to stockholders, to the extent known, in the
proxy solicitation materials furnished to the stockholders. There is no limit on
the amount of these out-of-pocket expenses, and there will be no review of the
reasonableness of the expenses by anyone other than our board of directors,
which includes persons who may seek reimbursement, or a court of competent
jurisdiction if such reimbursement is challenged. If none of our directors are
deemed “independent,” we will not have the benefit of independent directors
examining the propriety of expenses incurred on our behalf and subject to
reimbursement.
 
 Summary
Compensation Table
 
 No
compensation was paid or accrued during the fiscal year ended December 31, 2008
to (1) our President and Chief Executive and Chief Financial Officer or (2) our
Chief Operating Officer and Secretary. These two individuals are our only
officers and the Company has no employees receiving compensation. In the absence
of any compensation, a summary compensation table is not
applicable.
 
 2008
Grants of Plan-Based Awards
 
 The
Company has no equity or compensation plans and as a result there were no such
awards during the fiscal year ended December 31, 2008 to (1) our President and
Chief Executive and Chief Financial Officer or (2) our Chief Operating Officer
and Secretary. These two individuals are our only officers and the Company has
no employees.
 
 Employment
Agreement
 
 The
Company is not a party to any formal employment agreements.
 
 Fiscal
Year 2008 Stock Option Awards
 
 On May
21, 2008, the Company issued to certain of its founding stockholders and one of
its special advisors, warrants to purchase an aggregate of 185,000 shares of its
common stock, pursuant to agreements dated as of May 21, 2008, an amount that
will be reduced to 55,850 shares to comply with Amendment No.1 to the stock
purchase agreement. A copy of the form of agreement with such founding
stockholders was filed on a Form 8-K on May 23, 2008. As a result of the
issuance of the warrants, if such warrants are exercised, the founding
stockholders would have an 18.5% beneficial ownership interest in the Company
after giving effect to the warrant reduction required by the stock purchase
agreement, as amended, and before giving effect to the exercise of the private
placement warrants purchased at the time of the Offering. Under the terms of the
May 21, 2008 warrant agreements, the warrants are immediately exercisable at an
exercise price of $.01 and expire on the earlier of (x) January 31, 2009 if a
business combination is consummated in 2008 or 90 days after the consummation of
a business combination if such business combination occurs in 2009 or (y)
September 4, 2009. The holders of such warrants are restricted from selling or
transferring the warrants, or any common stock underlying such warrants, to any
transferee until September 4, 2009. During such restricted period, no sale or
transfer or other disposition of the warrants, or any common stock underlying
such warrants, can be made except for certain limited exceptions as set forth in
the warrant agreements. The issuance of the warrants on May 21, 2008 was made
pursuant to the exemption from the registration provisions of the Securities
Act, as amended, provided by Section 4(2) of the Securities Act and Regulation D
promulgated thereunder. The warrants and underlying common stock have not been
registered under the Securities Act and may not be offered or sold in the United
States absent registration or an applicable exemption from registration
requirements.
 
 37
 Table of Contents
 Compensation
Actions in 2008
 
 The
Company did not make any bonus or salary awards for performance during 2008, nor
has it approved any stock option awards for 2008 performance.
 
 Outstanding
Equity Awards at Fiscal 2008 Year-End
 
 The
Company did not make any equity awards for performance during 2008. The Company
did issue stock options to its officers and directors and one of its special
advisors during 2008 as described in Item 11 above under the heading “Fiscal
Year 2008 Stock Option Awards”.
 
 2008
Option Exercises and Stock Vested
 
 There
were no exercises of options to purchase our common stock by (1) our President
and Chief Executive and Chief Financial Officer or (2) our Chief Operating
Officer and Secretary. These two individuals are our only officers and no other
person exercised options to purchase our common stock during 2008. The Company
has not issued any stock to any person that is subject to vesting.
 
 Pension
Benefits
 
 The
Company does not have any qualified or non-qualified defined benefit
plans.
 
 Nonqualified
Deferred Compensation
 
 The
Company does not have any non-qualified defined contribution plans or other
deferred compensation plans.
 
 Potential
Payments Upon Termination or Change in Control
 
 The
Company is not party to any agreements, employment or otherwise, the terms of
which obligate the Company to make payments and provide benefits to the
Company’s executive officers in the event of a termination of
employment.
 
 2008
Director Compensation
 
 No
compensation was earned or paid by or to our non-employee directors in
2008.
 
 Director
Compensation Policy
 
 The
Company does not currently pay any fees to our directors.
 
 
 38
 Table of Contents
 Item12. Security Ownership of Certain Beneficial Owners and
Management and Related Stockholder Matters.
 
 The
following tables set forth information regarding the beneficial ownership of our
common stock as of the date of this report by:
 
 •
                each
      person known by us to be the beneficial owner of more than 5% of our
      outstanding shares of common
stock;
 •
                each
      of our officers and directors and special advisors;
  and
 •
                all
      our officers and directors and special advisors as a
  group.
 
 Beneficial
Owners of More Than 5% of IAG Common Stock
 
 Amount
      and Nature of Beneficial Ownership
                  
                  Approximate
      Percentage of Outstanding Common Stock (2)Name
      and Address of Beneficial Owner (1)Jeffrey
      Keswin, Lyrical Corp. I, LLC and Lyrical Partners, L.P.
(3)
                  
                  871,500
                  
                  12.1%William
      C. Morro
                  
                  715,178
                  (4)
                  9.7%Loeb
      Arbitrage Fund, Loeb Arbitrage Management, LLC, Loeb Marathon Fund
      LP, Loeb Marathon Offshore Fund, Ltd. and Loeb Offshore Fund,
      Ltd. (5)
                  
                  660,015
                  
                  9.4%The
      Goldman Sachs Group, Inc. and Goldman, Sachs & Co. (6)
                  
                  641,500
                  
                  9.2%Craig
      Samuels (7)
                  
                  606,000
                  
                  8.9%HBK
      Investments L.P., HBK Management LLC, HBK Master Fund L.P., HBK New York
      LLC, HBK Partners II L.P., HBK Services LLC and HBK Special
      Opportunity Fund I L.P. (8)
                  
                  526,571
                  
                  7.5%Richard
      N. Sinkin, Ph D.
                  
                  537,855
                  (9)
                  7.3%Mitchell
      Metzman and Marnie Metzman (10)
                  
                  465,000
                  
                  6.9%S.
      Muoio & Co. LLC and Salvatore Muoio (11)
                  
                  408,858
                  
                  5.8%Atlas
      Global Investments, Ltd., Atlas Global, LLC, Atlas Institutional Fund,
      Ltd., Atlas Master Fund, Ltd, Balyasny Asset Management L.P. and Dmitry
      Balyasny (12)
                  
                  400,000
                  
                  5.7%
  1.
                Unless
      otherwise indicated below in notes 3-12, the business address of each of
      the individuals and entities is 2918 Fifth Avenue South, Suite 209, San
      Diego, California 92103.
 
 2.
                Beneficial
      ownership has been determined in accordance with Rule 13d-3 under the
      Securities Exchange Act of 1934. Unless otherwise noted, we believe that
      all persons named in the table have sole voting and investment power with
      respect to all shares of our common stock beneficially owned by them.
      These amounts exclude shares issuable upon exercise of warrants that are
      not exercisable and are not expected to be exercisable within 60 days of
      March 31, 2009 but include common stock issuable upon the exercise of
      warrants issued to IAG management in May 2008 (after reduction of such
      warrants as required by Amendment No. 1 to the stock purchase agreement),
      which warrants are immediately
exercisable.
 
 3.
                Includes
      211,000 shares of common stock issuable upon the exercise of warrants. The
      business address of Jeffrey Keswin, Lyrical Corp. I, LLC and Lyrical
      Partners, L.P. is 405 Park Avenue, 6th Floor, New York, NY 10022. The
      foregoing information is derived from a Schedule 13G filed with the SEC on
      February 11, 2009.
 
 4.
                Includes
      32,903 shares of common stock issuable upon the exercise of warrants
      issued in May 2008 (after reduction of such warrants as required by
      Amendment No. 1 to the stock purchase agreement), which warrants are
      immediately exercisable.
 
 5.
                The
      business address of Loeb Arbitrage Fund, Loeb Arbitrage Management, LLC,
      Loeb Marathon Fund LP, Loeb Marathon Offshore Fund, Ltd. and Loeb Offshore
      Fund, Ltd. is 61 Broadway, New York, NY 10006. The foregoing information
      is derived from a Schedule 13D filed with the SEC on January 26,
      2009.
 
 6.
                The
      business address of Goldman Sachs Group, Inc. and Goldman, Sachs & Co.
      is 85 Broad Street, New York, NY 10004. The foregoing information is
      derived from a Schedule 13G filed with the SEC on February 6,
      2009.
 
 7.
                Includes
      606,000 shares of common stock issuable upon the exercise of warrants. The
      business address of Craig Samuels is13990 Rancho Dorado Bend, San Diego,
      CA 92130. The foregoing information is derived from a Schedule 13G/A filed
      with the SEC on February 13,
2009.
 
 39
 Table of Contents
 8.
                The
      business address of HBK Investments L.P., HBK Management LLC, HBK Partners
      II L.P. and HBK Services LLC is 2101 Cedar Springs Road, Suite 700,
      Dallas, Texas 75201. The business address of HBK Master Fund L.P. and HBK
      Special Opportunity Fund I L.P. is c/o HBK Services LLC, 2101 Cedar
      Springs Road, Suite 700, Dallas, TX 75201. The business address of HBK New
      York LLC is 350 Park Avenue, 20th Floor, New York, NY 10022. The foregoing
      information is derived from a Schedule 13G/A filed with the SEC on January
      29, 2009.
 
 9.
                Includes
      25,222 shares of common stock issuable upon the exercise of warrants
      issued in May 2008 (after reduction of such warrants as required by
      Amendment No. 1 to the stock purchase agreement), which warrants are
      immediately exercisable.
 
 10.
                Includes
      465,000 shares of common stock issuable upon the exercise of warrants. The
      business address of Mitchell Metzman and Marnie Metzman is 4808 Moorland
      Lane, Suite 109, Bethesda, MD. The foregoing information is derived from a
      Schedule 13G/A filed with the SEC on February 17,
  2009.
 
 11.
                The
      business address of S. Muoio & Co. LLC and Salvatore Muoio is 509
      Madison Avenue, Suite 406, New York, New York 10022. The foregoing
      information is derived from a Schedule 13G filed with the SEC on November
      5, 2008.
 
 12.
                The
      business address of Atlas Global Investments, Ltd., Atlas Global, LLC,
      Atlas Institutional Fund, Ltd., Atlas Master Fund, Ltd and Balyasny Asset
      Management L.P. is c/o Walkers SPV Limited, Walker House, P.O. Box 908 GT,
      George Town, Grand Cayman, Cayman Islands, British West Indies. The
      business address of Dmitry Balyasny is 181 West Madison, Suite 3600,
      Chicago, Illinois 60602. The foregoing information is derived from a
      Schedule 13G filed with the SEC on September 13,
  2007.
 
 Security
Ownership of Officers, Directors and Special Advisors of IAG
  Amount
      and Nature of Beneficial Ownership
                  
                  Approximate
      Percentage of Outstanding Common Stock (2)Name
      and Address of Beneficial Owner (1)William
      C. Morro
                  
                  715,178
                  (3)
                  9.7%Richard
      N. Sinkin, Ph D.
                  
                  537,855
                  (3)
                  7.3%Richard
      M. Wolfson (4)
                  
                  48,345
                  
                  *James
      Bazet (5)
                  
                  24,173
                  
                  *Dr.
      Herminio A. Blanco Mendoza (6)
                  
                  24,173
                  
                  *Richard
      Propper (7)
                  
                  61,000
                  
                  *Steven
      Oliveira (8)
                  
                  78,396
                  
                  1.1%All
      directors, executive officers and special advisors as a group (7
      individuals)
                  
                  1,250,000
                  (9)
                  17.9%
                  (10)
  * Less
than 1%
 1.
                Unless
      otherwise indicated below in notes 3-10, the business address of each of
      the individuals and entities is 2918 Fifth Avenue South, Suite 209, San
      Diego, California 92103.
 
 2.
                Beneficial
      ownership has been determined in accordance with Rule 13d-3 under the
      Securities Exchange Act of 1934. Unless otherwise noted, we believe that
      all persons named in the table have sole voting and investment power with
      respect to all shares of our common stock beneficially owned by them.
      These amounts exclude shares issuable upon exercise of warrants that are
      not exercisable and are not expected to be exercisable within 60 days of
      March 31, 2009 but include common stock issuable upon the exercise of
      warrants issued to IAG management in May 2008 (after reduction of such
      warrants as required by Amendment No. 1 to the stock purchase agreement),
      which warrants are immediately
exercisable.
 
 3.
                Includes
      173,438 shares of common stock held by InterAmerican Capital Partners II
      LLC, a holding company owned by William C. Morro and Dr. Richard N.
      Sinkin. Mr. Morro holds 60% of the membership interests of InterAmerican
      Capital Partners II LLC and Dr. Sinkin holds 40% of the membership
      interests of InterAmerican Capital Partners II LLC. However, Mr. Morro and
      Dr. Sinkin equally share ultimate dispositive and voting control over the
      shares of common stock held by InterAmerican Capital Partners II LLC and
      for that reason the impact of full beneficial ownership of InterAmerican
      Capital Partners II LLC is reflected in the table for each of Mr. Morro
      and Dr. Sinkin. If the percentage ownership for Mr. Morro and Dr. Sinkin
      were to be calculated based on their actual percentage holdings of
      InterAmerican Capital Partners II LLC membership interests, 104,063 shares
      would be allocated to Mr. Morro and 69,375 shares would be allocated to
      Dr. Sinkin. Also includes an aggregate of 9,861 shares of common stock
      issuable upon the exercise of warrants held by InterAmerican Capital
      Partners II LLC issued in May 2008 (after reduction of such warrants as
      required by Amendment No. 1 to the stock purchase agreement), which
      warrants are immediately
exercisable.
 
 40
 Table of Contents
 4.
                The
      business address of Richard M. Wolfson is 840 Crescent Center Drive, Suite
      600, Franklin, TN 37067.
 
 5.
                The
      business address of James Bazet is 6500 W. Cortland Street, Chicago, IL
      60707.
 
 6.
                The
      business address of Dr. Herminio A. Blanco Mendoza is Acordada #47, San
      Jose Insurgentes Benito Juarez, Mexico, D.F. 03900
    (Mexico).
 
 7.
                The
      business address of Richard Propper is 625 Broadway, Suite 1111, San
      Diego, CA 92101.
 
 8.
                The
      business address of Stephen Oliveira is 18 Fieldstone Court, New York, NY
      10956.
 
 9.
                Includes
      an aggregate of 55,850 shares of common stock issuable upon the exercise
      of warrants issued in May 2008, which warrants are immediately
      exercisable, after giving effect to the reduction of 129,150 such warrants
      as required by Amendment No. 1 to the stock purchase agreement. Since the
      173,438 shares of common stock owned by InterAmerican Capital Partners II
      LLC are included in the beneficial ownership calculations of both Mr.
      Morro and Dr. Sinkin, such shares are only counted once for purposes of
      this total. Since the 9,861 shares of common stock issuable upon the
      exercise of warrants owned by InterAmerican Capital Partners II LLC (after
      the required reduction) are included in the beneficial ownership
      calculations of both Mr. Morro and Dr. Sinkin, such shares are only
      counted once for purposes of this
total.
 
 10.
                Includes
      an aggregate of 55,850 shares of common stock issuable upon the exercise
      of warrants issued in May 2008, which warrants are immediately
      exercisable, after giving effect to the reduction of 129,150 such warrants
      as required by Amendment No. 1 to the stock purchase agreement. Since the
      173,438 shares of common stock owned by InterAmerican Capital Partners II
      LLC are included in the beneficial ownership calculations of both Mr.
      Morro and Dr. Sinkin, such shares are only counted once for purposes of
      calculating the percentage of beneficial ownership of all officers,
      directors and special advisors as a group. Since the 9,861 shares of
      common stock issuable upon the exercise of warrants owned by InterAmerican
      Capital Partners II LLC (after the required reduction) are included in the
      beneficial ownership calculations of both Mr. Morro and Dr. Sinkin, such
      shares are only counted once for purposes of this
  total.
 
 Because
of this ownership block, these stockholders may be able to effectively influence
the outcome of all matters requiring approval by our stockholders, including the
election of directors and approval of significant corporate transactions other
than approval of a business combination. All of the shares of common stock
outstanding prior to the date of the Offering were placed in escrow with
Continental Stock Transfer & Trust Company, as escrow agent, until the
earliest of:
 
 •
                two
      years following the effective date of the
  Offering;
 •
                our
      liquidation; and
 •
                the
      consummation of a liquidation, merger, stock exchange or other similar
      transaction which results in all of our stockholders having the right to
      exchange their shares of common stock for cash, securities or other
      property subsequent to our consummating a business combination with a
      target business.
 
 During
the escrow period, the holders of these shares will not be able to sell or
transfer their securities except to their spouses and children or trusts
established for their benefit, but will retain all other rights as our
stockholders, including, without limitation, the right to vote their shares
of common stock and the right to receive cash dividends, if declared. If
dividends are declared and payable in shares of common stock, such dividends
will also be placed in escrow. If we are unable to effect a business combination
and liquidate, none of our founding stockholders will receive any portion of the
liquidation proceeds with respect to common stock owned by them prior to the
date of this prospectus.
 
 Item13. Certain Relationships and Related
Transactions.
  In May
2005, we issued 1,250,000 shares of our common stock for $15,000 in cash, at a
purchase price of $0.012 per share (giving retroactive effect to a 2-for-5
reverse stock split we effected in December 2005, a reallocation of shares among
our officers and directors, a 1.25-for-1 stock split we effected in April 2006,
a 1.44-for-1 stock split we effected in May 2006, a 1-for-2.16 reverse stock
split effected in June 2007, a transfer of 325,000 shares from our founding
stockholders to our special advisors in June 2007 and a transfer of an aggregate
of 189,000 shares from our special advisor, Richard Propper, to our two
executive officers in August 2007). The shares are now owned by the following
stockholders:
  41
 Table of Contents
  Name
                  
                  Number
      of Shares
                  
                  Relationship
      to UsWilliam
      C. Morro
                  
                  508,837
                  
                  Chief
      Executive Officer, Chief Financial Officer and Chairman of the Board of
      DirectorsDr.
      Richard N. Sinkin
                  
                  339,225
                  
                  Chief
      Operating Officer, Secretary and DirectorRichard
      M. Wolfson
                  
                  46,250
                  
                  DirectorInterAmerican
      Capital Partners II LLC
                  
                  173,438
                  
                  StockholderJames
      Bazet
                  
                  23,125
                  
                  DirectorDr.
      Herminio A. Blanco Mendoza
                  
                  23,125
                  
                  DirectorRichard
      Propper
                  
                  61,000
                  
                  Special
      AdvisorSteven
      Oliveira
                  
                  75,000
                  
                  Special
      Advisor1,250,000
 
 Concurrently
with the closing of the initial public offering, InterAmerican Capital Partners
II, LLC and affiliates and one of our Special Advisors collectively purchased a
combined total of 1,000,000 of our warrants from us at a price of $1.50 per
warrant. These warrants, which we collectively refer to as the founders’
warrants, will not be sold or transferred by the purchasers who initially
purchased these warrants from us until the completion of our initial business
combination. The $1,500,000 purchase price of the founders’ warrants was added
to the proceeds of the initial public offering to be held in the trust account
pending our completion of one or more business combinations. If we do not
complete one or more business combinations that meet the criteria described
herein, then the $1,500,000 purchase price of the founders’ warrants will become
part of the liquidation amount distributed to our public stockholders from our
trust account as part of any plan of dissolution and distribution and the
founders’ warrants will expire worthless.
 
 The
holders of the majority of the 1,250,000 shares are entitled to require us, on
up to two occasions, to register these shares and the and the holders of a
majority of the founders’ warrants are entitled to make up to one demand that we
register such warrants pursuant to an agreement signed on the date of the
Offering. The holders of the majority of the 1,250,000 shares can elect to
exercise the registration rights at any time commencing three months prior to
the date on which these shares of common stock are to be released from escrow.
In addition, these security holders have certain ‘‘piggy-back’’
registration rights with respect to registration statements filed subsequent to
the date on which these shares of common stock are released from escrow. We will
bear the expenses incurred in connection with the filing of any such
registration statements.
 
 The
holders of the majority of these shares may elect to exercise these registration
rights at any time after the date on which these shares of common stock are
released from escrow, which, except in limited circumstances, is not before
three years from the date of the Offering. In addition, these stockholders and
the holders of the founding director warrants have certain “piggy-back”
registration rights on registration statements filed subsequent to the date on
which these shares of common stock are released from escrow or the founding
director warrants become exercisable, as the case may be. We will bear the
expenses incurred in connection with the filing of any such registration
statements.
 
 We have
agreed to pay InterAmerican Advisors, LLC $10,000 per month for use of office
space, utilities, administrative, technology and secretarial services for up to
12 months. InterAmerican Advisors, LLC is owned by our management. Messrs. Morro
and an affiliate of Dr. Sinkin own 3% and 97% of InterAmerican Advisors, LLC,
respectively. The name of the affiliate of Dr. Sinkin is Sintrim Capital Corp.,
a Delaware corporation that is wholly controlled by Dr. Sinkin. Sintrim
Capital Corp. is a holding company used by Dr. Sinkin to hold certain business
assets. Accordingly, each will benefit from the transaction to the extent of his
respective interest in InterAmerican Advisors, LLC. However, this arrangement is
solely for our benefit and is not intended to provide Mr. Morro and Dr. Sinkin
compensation in lieu of a salary. We believe, based on rents and fees for
similar services in the metropolitan area of San Diego, that the fee charged by
InterAmerican Advisors, LLC is at least as favorable as we could have obtained
from an unaffiliated person.
 
 On May
21, 2008, the Company issued to certain of its founding stockholders and one of
its special advisors, warrants to purchase an aggregate of 185,000 shares of its
common stock, pursuant to agreements dated as of May 21, 2008, an amount that
will be reduced to 55,850 shares to comply with Amendment No.1 to the stock
purchase agreement. A copy of the form of agreement with such founding
stockholders was filed on a Form 8-K on May 23, 2008. As a result of the
issuance of the warrants, if such warrants are exercised, the founding
stockholders would have an 18.5% beneficial ownership interest in the Company
after giving effect to the warrant reduction required by the stock purchase
agreement, as amended, and before giving effect to the exercise of the private
placement warrants purchased at the time of the Offering. Under the terms of the
May 21, 2008 warrant agreements, the warrants are immediately exercisable at an
exercise price of $.01 and expire on the earlier of (x) January 31, 2009 if a
business combination is consummated in 2008 or 90 days after the consummation of
a business combination if such business combination occurs in 2009 or (y)
September 4, 2009. The holders of such warrants are restricted from selling or
transferring the warrants, or any common stock underlying such warrants, to any
transferee until September 4, 2009 (the “Restricted Period”). During the
Restricted Period, no sale or transfer or other disposition of the warrants, or
any common stock underlying such warrants, can be made except for certain
limited exceptions as set forth in the warrant agreements. The issuance of the
warrants on May 21, 2008 was made pursuant to the exemption from the
registration provisions of the Securities Act, provided by Section 4(2) of the
Securities Act and Regulation D promulgated thereunder. The warrants and
underlying common stock have not been registered under the Securities Act and
may not be offered or sold in the United States absent registration or an
applicable exemption from registration requirements.
 
 42
 Table of Contents
 Each of
Mr. Morro and Dr. Sinkin is deemed to be our “parent” and “promoter,” as these
terms are defined under the Federal securities laws.
 
 If we
liquidate before the completion of a business combination and distribute the
proceeds held in trust to our public stockholders, William C. Morro, our chief
executive officer, chief financial officer and chairman of our board of
directors and Dr. Richard N. Sinkin, our chief operating officer, secretary and
a member of our board of directors, have severally (but not jointly) agreed,
pursuant to agreements with us and Chardan Capital Markets, LLC, that they will
be personally liable, severally (but not jointly), which means they will be
personally liable only for 60% and 40%, respectively (as an example, if there is
a valid third party claim of $1,000,000, Mr. Morro will be responsible for
$600,000 of such claim and Dr. Sinkin will be responsible for $400,000 of
such claim), to pay claims of third parties that are owed money for services
rendered to us or products sold to us (which includes, for example, accountants,
lawyers, investment bankers, consultants and analysts) that would reduce the
amount of the trust, provided that such third party has not executed a valid and
enforceable waiver to rights or claims against the trust account and only to the
extent necessary to ensure that such claims do not reduce the amount in the
trust account. The indemnification provided by Mr. Morro and Dr. Sinkin would
not cover tort claims brought against us for some unforeseen event, claims
against us brought by a target business for breach of contract or breach of a
confidentiality agreement with a potential target. We will bring an action
against either of our executive officers in the event that such individual
asserts that he is not able to cover any of the expenses that would deplete the
trust proceeds or that either is not liable pursuant to their indemnification
obligations as described above. Based on the information provided to us in the
director and officer questionnaires provided to us in connection with the
Offering as well as the representations as to their accredited investor status
(as such term is defined in Regulation D), we currently believe that such
persons are of substantial means and capable of funding their indemnity
obligations. However, because the amount of any such indemnification obligations
cannot be estimated, we have not asked Mr. Morro or Dr. Sinkin to reserve for
such an eventuality and there can be no assurance that they will satisfy their
indemnification obligations if and when they arise. Further, they will not be
personally liable to pay debts and obligations to prospective target businesses,
if a business combination is not consummated with such prospective target
businesses, or for claims from any entity other than as described
above.
 
 If we are
required to liquidate, we expect that all costs associated with the
implementation and completion of our plan of dissolution and distribution, which
we currently estimate to be approximately $50,000 to $75,000, will be funded by
any funds not held in our trust account, although we cannot assure you that
there will be sufficient funds for such purpose. To the extent such funds are
not available, the principals of InterAmerican Capital Partners II LLC have
agreed to advance us the necessary funds and have agreed not to seek repayment
for such expenses. However, there can be no assurance that they will be able to
meet their obligations under this agreement. InterAmerican Capital Partners II
LLC, a holding company owned by William C. Morro (60%) and Dr. Richard N. Sinkin
(40%), owns 173,438 of our outstanding shares of common
stock.
 
 We will
reimburse our officers and directors and special advisors for any reasonable
out-of-pocket business expenses incurred by them in connection with certain
activities on our behalf such as identifying and investigating possible target
businesses and business combinations. There is no limit on the amount of
accountable out-of-pocket expenses reimbursable by us, which will be reviewed
only by our board or a court of competent jurisdiction if such reimbursement is
challenged. Accountable out-of-pocket expenses incurred by our officers and
directors and special advisors will not be repaid out of proceeds held in trust
until these proceeds are released to us upon the completion of a business
combination, provided there are sufficient funds available for reimbursement
after such consummation.
 
 Other
than the reimbursable out-of-pocket expenses payable to our officers and
directors and special advisors, no compensation or fees of any kind, including
finders and consulting fees, will be paid to any of our initial stockholders,
officers or directors who owned our common stock prior to the initial public
offering, or to any of their respective affiliates for services rendered to us
prior to or with respect to the business combination.
 
 Our
initial stockholders will not receive reimbursement for any out-of-pocket
expenses incurred by them to the extent that such expenses exceed the amount
held outside of the trust account unless the business combination is consummated
and there are sufficient funds available for reimbursement after such
consummation. The financial interest of such persons could influence their
motivation in selecting a target business and thus, there may be a conflict of
interest when determining whether a particular business combination is in the
stockholders’ best interest.
 
 After the
consummation of a business combination, if any, to the extent our management
remains as officers of the resulting business, some of our officers and
directors may enter into employment agreements, the terms of which shall be
negotiated and which we expect to be comparable to employment agreements with
other similarly-situated companies in the media, entertainment and
telecommunications industries. Further, after the consummation of a business
combination, if any, to the extent our directors remain as directors of the
resulting business, we anticipate that they will receive compensation comparable
to directors at other similarly-situated companies in the applicable
industry.
 
 43
 Table of Contents
 All
ongoing and future transactions between us and any of our officers and directors
or their respective affiliates, will be on terms believed by us at that time,
based upon other similar arrangements know to us, to be no less favorable than
are available from unaffiliated third parties and any transactions or loans,
including any forgiveness of loans, will require prior approval in each instance
by a majority of our uninterested “independent” directors (to the extent we have
any) or the members of our board who do not have an interest in the transaction,
in either case who had access, at our expense, to our attorneys or independent
legal counsel. We will not enter into any such transaction unless our
disinterested “independent” directors (or, if there are no “independent”
directors, our disinterested directors) determine that the terms of such
transaction are no less favorable to us than those that would be available to us
with respect to such a transaction from unaffiliated third parties.
 
 In
connection with the Offering, Chardan Capital Markets, LLC acting for the
underwriters, has agreed to defer payment of $2,070,000 of underwriting fees
until completion of a business combination. Until a business combination is
complete, these funds will remain in the Trust Account. If the Company does not
complete a business combination then the deferred fees will become part of the
funds returned to the Company’s Public Stockholders from the Trust Account upon
its liquidation as part of any plan of dissolution and distribution approved by
the Company’s stockholders.
 
 Item14. Principal Accounting Fees and Services
 
 Description
of Professional Services
 
 As
previously disclosed in our January 2008 Current Report on Form 8-K, certain of
the partners of Goldstein Golub Kessler LLP (“GGK”) became partners of McGladrey
& Pullen, LLP (“M&P”).  As a result, GGK resigned as auditors
of the Company effective January 28, 2008 and M&P was appointed as our
independent registered public accounting firm in connection with our annual
financial statements for the fiscal years ended December 31, 2008 and
2007.
 
 Audit
Fees
 
 The
aggregate fees paid to GGK in 2007, which includes fees relating to the initial
public offering and for the review of financial statements included in our
quarterly reports on Form 10-Q were approximately $44,500.  We expect
to be billed approximately $30,000 by M&P in connection with our December
31, 2008 year-end audit.  The aggregate fees for professional services
rendered by M&P in 2008 were approximately $90,000, which includes fees
relating to our quarterly reports on Form 10-Q of $35,500 and fees relating to
the review of our initial Registration Statement on Form S-4 related to the Sing
Kung transaction and subsequent amendments thereto of approximately
$54,500.  In addition, M&P billed us approximately $33,000 in
connection with our December 31, 2007 year-end audit.
 
 Audit-Related
Fees
 
 Audit
related fees are for assurance and related services including, among others,
consultation concerning financial accounting and reporting standards. There were
no aggregate fees billed for audit-related services rendered by GGK or
M&P.
 
 Tax
Fees
 
 The fees
paid to RSM McGladrey Inc., an affiliate of M&P, in 2008 for tax compliance
totaled $5,000.
 
 Audit
Committee Approval
 
 The Audit
Committee is responsible for appointing, setting compensation, and overseeing
the work of the independent auditor. The Audit Committee has established a
policy regarding pre-approval of all audit and permissible non-audit services
provided by the independent auditor. A centralized service request function is
used to provide an initial assessment of requests for services by the
independent auditor. The request must be specific as to the particular services
to be provided. Requests approved during the initial assessment are aggregated
and submitted to the Audit committee for final approval. The independent auditor
may not perform services, whether associated with audit or non-audit functions,
unless the services have been approved prior to their performance by the
Company’s Audit Committee. Each fiscal year, the Audit Committee negotiates and
pre-approves the fee for the annual audit of the Company’s Consolidated
Financial Statements. Each fiscal year, the Audit Committee may also
specifically pre-approve certain audit services, audit-related services, tax
services and other services. At the present time, the Audit Committee has not
delegated any authority for approval of any services. All audit and permissible
non-audit services provided by the independent auditor have been approved by the
Audit Committee.
 
 44
 Table of Contents
 
 PART
IV
 
 Item15. Exhibits and Financial Statement Schedules
  INTERAMERICAN
ACQUISITION GROUP, INC
 
 (a
corporation in the development stage)
 
 Financial
Statements
  For the
years ended December 31, 2008 and December 31, 2007 and the cumulative
period
 from
May 10, 2005 (inception) to December 31, 2008.
  Contents
  Reports
      of Independent Registered Public Accounting
  Firms
  Audited
      Financial Statements
 Balance
      Sheets
                          F-3Statements
      of Operations
                          F-4Statement
      of Stockholders’ Equity
                          F-5Statements
      of Cash Flows
                          F-6Notes
      to Financial Statements
                          F-7
  Exhibits.
  We hereby
file as part of this Annual Report on Form 10-K the Exhibits listed in the
attached Exhibit Index. Exhibits which are incorporated herein by reference can
be inspected and copied at the public reference facilities maintained by the
SEC, 100 F Street, N.E., Room 1580, Washington, D.C. 20549. Copies of such
material can also be obtained from the Public Reference Section of the SEC, 100
F Street, N.E., Room 1580, Washington, D.C. 20549, at prescribed rates or on the
SEC website at www.sec.gov.
 
 Contents
  3.1(a)
                Second
      Amended and Restated Certificate of
  Incorporation*
 3.1(b)
                Certificate
      of Amendment to Second Amended and Restated Certificate of
      Incorporation*
 3.2
                Bylaws*
 4.1
                Specimen
      Unit Certificate*
 4.2
                Specimen
      Common Stock Certificate*
 4.3
                Specimen
      Warrant Certificate*
 4.4
                Form
      of Warrant Agreement between Continental Stock Transfer & Trust
      Company and the Registrant.*
 4.5
                Form
      of Warrant Certificate (issued in private
  placement).*
 10.1
                Form
      of Letter Agreement among the Registrant, Chardan Capital Markets, LLC and
      William C. Morro.*
 10.2
                Form
      of Letter Agreement among the Registrant, Chardan Capital Markets, LLC and
      Dr. Richard N. Sinkin*
 10.3
                Form
      of Letter Agreement among the Registrant, Chardan Capital Markets, LLC and
      Richard M. Wolfson*
 10.4
                Form
      of Letter Agreement among the Registrant, Chardan Capital Markets, LLC and
      James Bazet.*
 10.5
                Form
      of Letter Agreement among the Registrant, Chardan Capital Markets, LLC and
      Dr. Herminio A. Blanco Mendoza.*
 10.6
                Form
      of Letter Agreement among the Registrant, Chardan Capital Markets, LLC and
      InterAmerican Capital Partners II
LLC.*
 10.7
                Form
      of Letter Agreement among the Registrant, Chardan Capital Markets, LLC and
      Richard Propper.*
 10.8
                Form
      of Letter Agreement among the Registrant, Chardan Capital Markets, LLC and
      Steven Oliveira.*
 45
 Table of Contents
  10.9
                Form
      of Underwriting Agreement.*
 10.10
                Form
      of Investment Management Trust Agreement between Continental Stock
      Transfer & Trust Company and the
  Registrant.*
 10.11
                Form
      of Stock Escrow Agreement between the Registrant, Continental Stock
      Transfer & Trust Company and the Initial Stockholders.*
 10.12
                Form
      of Letter Agreement between InterAmerican Advisors, LLC and the Registrant
      regarding administrative support.*
 10.13
                Form
      of Registration Rights Agreement among the Registrant and the Initial
      Stockholders.*
 10.14
                Form
      of Fourth Amended and Restated Warrant Purchase Agreement dated June 27,
      2007 between the Registrant, one
      of its special advisors and InterAmerican Capital Partners II
      LLC.*
 14.1
                Code
      of Ethics and Conduct for officers and members of the Board of
      Directors.
 16
                Letter
      from Goldstein Golub Kessler LLP to the Securities and Exchange
      Commission, dated January 16,
2008.**
 31
                Certification
      of Chief Executive Officer and Chief Financial Officer pursuant to Rule
      13a-14(a) of the Securities Exchange Act of 1934, as amended, as
      adopted pursuant to Section 302 of the Sarbanes-Oxley Act of
      2002
 
 32
                Certification
      of Chief Executive Officer and Chief Financial Officer pursuant to 18
      U.S.C. Section 1350, as adopted pursuant
      to Section 906 of the Sarbanes-Oxley Act of
  2002
  
 *
      Incorporated by reference to our Registration Statement on Form S-1, as
      amended (File No. 333-125558).
 **
      Incorporated by reference to our Current Report on Form 8-K filed on
      January 16, 2008.
 
 
 46
 Table of Contents
  Report
of Independent Registered Public Accounting Firm
 
 To the
Board of Directors and Stockholders
 InterAmerican
Acquisition Group Inc.
 
 We have
audited the accompanying consolidated balance sheets of InterAmerican
Acquisition Group Inc. (a corporation in the development stage) as of December
31, 2008 and 2007, and the related consolidated statements of operations,
stockholders' equity, and cash flows for the years then ended, and for the
cumulative period from May 10, 2005 (inception) to December 31, 2008. These
financial statements are the responsibility of the Company's
management.  Our responsibility is to express an opinion on these
financial statements based on our audits.  The financial statements
for the period from May 10, 2005 (inception) to December 31, 2006 were audited
by other auditors and our opinion, insofar as it relates to cumulative amounts
included for such prior periods, is based solely on the reports of such other
auditors.
 
 We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements.  An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.  We believe that our audits and the report of the other
auditors provide a reasonable basis for our opinion.
 
 In our
opinion, based on our audits and the report of the other
auditors,  the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of
InterAmerican Acquisition Group Inc. as of December 31, 2008 and 2007, and the
results of its operations and its cash flows for the years then ended, and for
the cumulative period from May 10, 2005 (inception) to December 31, 2008, in
conformity with U.S. generally accepted accounting principles.
 
 We were
not engaged to examine management's assessment of the effectiveness of
InterAmerican Acquisition Group Inc.'s internal control over financial reporting
as of December 31, 2008, included in the accompanying management’s report on
Internal Control Over Financial Reporting and, accordingly, we do not express an
opinion thereon.
 
 The
accompanying financial statements have been prepared assuming InterAmerican
Acquisition Group Inc. will continue as a going concern.  As discussed
in Note 1 to the consolidated financial statements, the Company will face a
mandatory liquidation on September 10, 2009 if a business combination is not
consummated, and as discussed in Note 11, the Company has a working capital
deficiency, which raise substantial doubt about its ability to continue as a
going concern.  The consolidated financial statements do not include
any adjustments that might result from the outcome of this
uncertainty.
   /s/ McGladrey &
Pullen, LLP
 
 McGLADREY
& PULLEN, LLP
  New York,
New York
 March 31,
2009
 
 
 F-1
 Table of Contents
 
 
 REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
 To the
Board of Directors and Stockholders
 InterAmerican
Acquisition Group Inc.
  We have
audited the accompanying statement of stockholders’ equity of InterAmerican
Acquisition Group Inc. (a corporation in the development stage) (the
“Company”) for the period from May 10, 2005 (inception) to December 31, 2005 and
the year ended December 31, 2006, and the amounts included in the cumulative
columns in the statements of operations and cash flows for the period from May
10, 2005 (inception) to December 31, 2006.  These financial statements
are the responsibility of the Company’s management.  Our
responsibility is to express an opinion on these financial statements based on
our audits.
  We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements.  An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement
presentation.  We believe that our audits provide a reasonable basis
for our opinion.
  In our
opinion, the financial statements referred to above present fairly, in all
material respects, the stockholders’ equity of InterAmerican Acquisition Group
Inc. for the period from May 10, 2005 (inception) to December 31, 2005 and the
year ended December 31, 2006, and the results of its operations and cash flows
for the cumulative period from May 10, 2005 (inception) to December 31, 2006, in
conformity with United States generally accepted accounting
principles.
  /s/
GOLDSTEIN GOLUB KESSLER LLP
  GOLDSTEIN
GOLUB KESSLER LLP
  New York,
New York
  September
14, 2007
  
 F-2
 Table of Contents
 
 ITEM
1: FINANCIAL STATEMENTS
  InterAmerican
      Acquisition Group Inc.(a
      corporation in the development stage)Consolidated
      Balance
Sheets
  December 31, 2008
                                                      
                                                      
                                                      December 31, 2007ASSETSCurrent
      Assets:Cash
                                                      
                                                      $
                                                      20,773
                                                      
                                                      
                                                      $
                                                      15,533Investment
      and accrued interest - trust account
                                                      
                                                      
                                                      45,204,605
                                                      
                                                      
                                                      
                                                      45,517,583Prepaid
      expense
                                                      
                                                      
                                                      19,552
                                                      
                                                      
                                                      
                                                      87,871Total
      current assets
                                                      
                                                      
                                                      45,244,930
                                                      
                                                      
                                                      
                                                      45,620,987Deferred
      tax asset
                                                      
                                                      
                                                      195,000
                                                      
                                                      
                                                      
                                                      57,610Total
      Assets
                                                      
                                                      $
                                                      45,439,930
                                                      
                                                      
                                                      $
                                                      45,678,597LIABILITIES
      AND STOCKHOLDERS' EQUITY/(DEFICIENCY)Current
      LiabilitiesAccounts
      payable and accrued expenses (including amounts payable to related
      parties of $51,844 and $10,000 for 2008 and 2007
    respectively)
                                                      
                                                      $
                                                      606,883
                                                      
                                                      
                                                      $
                                                      203,533Note
      payable
                                                      
                                                      
                                                      -
                                                      
                                                      
                                                      
                                                      46,734Income
      and capital taxes payable
                                                      
                                                      
                                                      284,380
                                                      
                                                      
                                                      
                                                      300,796Deferred
      underwriting fees
                                                      
                                                      
                                                      2,070,000
                                                      
                                                      
                                                      
                                                      2,070,000Total
      Current Liabilities
                                                      
                                                      
                                                      2,961,263
                                                      
                                                      
                                                      
                                                      2,621,063COMMON
      STOCK SUBJECT TO POSSIBLE REDEMPTION(1,149,425
      shares at redemption value) (Note 1)
                                                      
                                                      
                                                      8,609,194
                                                      
                                                      
                                                      
                                                      8,609,194Stockholders'
      EquityPreferred
      stock, $0.0001 par valueAuthorized
      1,000,000 shares; none issuedCommon
      stock, $0.0001 par valueAuthorized
      90,000,000 sharesIssued
      and outstanding 7,000,000 shares at December 31, 2007 and 2008 (which
      includes 1,149,425 shares subject to possible redemption)
                                                      
                                                      
                                                      700
                                                      
                                                      
                                                      
                                                      700Additional
      paid-in capital
                                                      
                                                      
                                                      35,106,999
                                                      
                                                      
                                                      
                                                      34,323,139Income/(Deficit)
      accumulated during the development stage
                                                      
                                                      
                                                      (1,238,226
                                                      )
                                                      
                                                      
                                                      124,501Total
      Stockholders' Equity
                                                      
                                                      
                                                      33,869,473
                                                      
                                                      
                                                      
                                                      34,448,340Total
      Liabilities and Stockholders Equity
                                                      
                                                      $
                                                      45,439,930
                                                      
                                                      
                                                      $
                                                      45,678,597
  See
      notes to consolidated financial
statements
  
 F-3
 Table of Contents
  InterAmerican
      Acquisition Group Inc.(a
      corporation in the development stage)Consolidated
      Statements of Operations  For
      the cumulativeFor
      the Year Ended
                                                  
                                                  
                                                  period
      fromDecember
      31, 2008
                                                  
                                                  
                                                  December
      31, 2007
                                                  
                                                  
                                                  May
      10, 2005 (Inception) - December 31, 2008Interest
      income
                                                  
                                                  $
                                                  761,373
                                                  
                                                  
                                                  $
                                                  565,230
                                                  
                                                  
                                                  $
                                                  1,326,603ExpensesFormation
      costs
                                                  
                                                  
                                                  
                                                  
                                                  
                                                  
                                                  -
                                                  
                                                  
                                                  
                                                  4,775General
      and administrative expenses
                                                  
                                                  
                                                  2,013,845
                                                  
                                                  
                                                  
                                                  308,760
                                                  
                                                  
                                                  
                                                  2,336,057Interest
      expense
                                                  
                                                  
                                                  3,411
                                                  
                                                  
                                                  
                                                  5,899
                                                  
                                                  
                                                  
                                                  17,075Total
      Expenses
                                                  
                                                  
                                                  2,017,256
                                                  
                                                  
                                                  
                                                  314,659
                                                  
                                                  
                                                  
                                                  2,357,907Net
      profit/(loss) before income tax provision
                                                  
                                                  
                                                  (1,255,883
                                                  )
                                                  
                                                  
                                                  250,571
                                                  
                                                  
                                                  
                                                  (1,031,304
                                                  )Provision
      for income taxes
                                                  
                                                  
                                                  106,844
                                                  
                                                  
                                                  
                                                  100,078
                                                  
                                                  
                                                  
                                                  206,922Net
      income/(loss)
                                                  
                                                  $
                                                  (1,362,727
                                                  )
                                                  
                                                  $
                                                  150,493
                                                  
                                                  
                                                  $
                                                  (1,238,226
                                                  )Weighted
      average shares outstanding - basic and diluted
                                                  
                                                  
                                                  7,000,000
                                                  
                                                  
                                                  
                                                  3,032,534
                                                  
                                                  
                                                  
                                                  3,317,474Net
      earnings/(loss) per share -    basic and
      diluted
                                                  
                                                  $
                                                  (0.19
                                                  )
                                                  
                                                  $
                                                  0.05
                                                  
                                                  
                                                  $
                                                  (0.37
                                                  )
 See
      notes to consolidated financial
statements
 
 F-4
 Table of Contents
 InterAmerican
      Acquisition Group Inc.(a
      corporation in the development stage)Consolidated
      Statement of Stockholders' Equity/(Deficiency)For
      the period from May 10, 2005 (Inception)  through December 31,
      2008
  Income/(Deficit)AccumulatedDuring
      the
                                              
                                              
                                              Stockholders'Common
      Stock
                                              
                                              
                                              Additional
                                              
                                              
                                              Development
                                              
                                              
                                              Equity/Shares
                                              
                                              
                                              Amount
                                              
                                              
                                              paid-in
      capital
                                              
                                              
                                              Stage
                                              
                                              
                                              (Deficiency)Common
      shares issued May 26, 2005 at $0.01 per share
                                              
                                              
                                              1,250,000
                                              
                                              
                                              $
                                              125
                                              
                                              
                                              $
                                              14,875
                                              
                                              
                                              $
                                              -
                                              
                                              
                                              $
                                              15,000Net
      Loss
                                              
                                              
                                              -
                                              
                                              
                                              
                                              -
                                              
                                              
                                              
                                              -
                                              
                                              
                                              
                                              (11,148
                                              )
                                              
                                              
                                              (11,148
                                              )Balance
      at December 31, 2005
                                              
                                              
                                              1,250,000
                                              
                                              
                                              
                                              125
                                              
                                              
                                              
                                              14,875
                                              
                                              
                                              
                                              (11,148
                                              )
                                              
                                              
                                              3,852Net
      Loss
                                              
                                              
                                              -
                                              
                                              
                                              
                                              -
                                              
                                              
                                              
                                              -
                                              
                                              
                                              
                                              (14,844
                                              )
                                              
                                              
                                              (14,844
                                              )Balance
      at December 31, 2006
                                              
                                              
                                              1,250,000
                                              
                                              
                                              
                                              125
                                              
                                              
                                              
                                              14,875
                                              
                                              
                                              
                                              (25,992
                                              )
                                              
                                              
                                              (10,992
                                              )Proceeds
      of private placement September 10, 2007
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              1,500,000
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              1,500,000Units
      issued Sept. 10, 2007 @$8.00 per unit
                                              
                                              
                                              5,375,000
                                              
                                              
                                              
                                              538
                                              
                                              
                                              
                                              42,999,462
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              43,000,000Units
      issued Sept. 11, 2007 @$8.00 per unit
                                              
                                              
                                              375,000
                                              
                                              
                                              
                                              37
                                              
                                              
                                              
                                              2,999,963
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              3,000,000Expenses
      of the Offering
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              (4,581,967
                                              )
                                              
                                              
                                              
                                              
                                              
                                              
                                              (4,581,967
                                              )Less
      shares subject to possible redemption
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              (8,609,194
                                              )
                                              
                                              
                                              
                                              
                                              
                                              
                                              (8,609,194
                                              )Net
      Income
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              -
                                              
                                              
                                              
                                              150,493
                                              
                                              
                                              
                                              150,493Balance
      at December 31, 2007
                                              
                                              
                                              7,000,000
                                              
                                              
                                              
                                              700
                                              
                                              
                                              
                                              34,323,139
                                              
                                              
                                              
                                              124,501
                                              
                                              
                                              
                                              34,448,340Issuance
      of 185,000 warrants May 21, 2008
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              783,860
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              783,860Net
      Loss
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              
                                              -
                                              
                                              
                                              
                                              (1,362,727
                                              )
                                              
                                              
                                              (1,362,727
                                              )Balance
      at December 31, 2008
                                              
                                              
                                              7,000,000
                                              
                                              
                                              $
                                              700
                                              
                                              
                                              $
                                              35,106,999
                                              
                                              
                                              $
                                              (1,238,226
                                              )
                                              
                                              $
                                              33,869,473
  See
      notes to consolidated financial
statements
  
 F-5
 Table of Contents
  InterAmerican
      Acquisition Group Inc.(a
      corporation in the development stage)Consolidated
      Statements of Cash
Flows
  For
      the cumulativeYear
      Ended
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            period
      fromDecember 31,
      2008
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            December 31,
      2007
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            May
      10, 2005 (Inception) - December 31, 2008Cash
      flow from operating activitiesNet
      income/(loss)
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            (1,362,727
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            150,493
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            (1,238,226
                                                                                                                                                            )Adjustments
      to reconcile income/(loss) to net cash used in operating
      activities:Non-cash
      compensation related to the issuance of warrants
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            783,860
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            783,860Net
      interest income
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (761,373
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (565,230
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (1,326,603
                                                                                                                                                            )(Increase)/decrease
      in prepaid expenses
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            68,319
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (87,871
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (19,552
                                                                                                                                                            )(Increase)/decrease
      in deferred income tax asset
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (137,390
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (57,610
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (195,000
                                                                                                                                                            )Increase/(decrease)
      in taxes payable
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (16,416
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            300,796
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            284,380Increase/(decrease)
      in accounts payable and accrued expenses
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            548,350
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            30,959
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            598,399Net
      cash provided by/(used in) operating activities
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (877,377
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (228,463
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (1,112,742
                                                                                                                                                            )Cash
      flows from investment activitiesPayment
      to trust account
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (45,160,000
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (45,160,000
                                                                                                                                                            )Interest
      drawn from trust account
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            1,074,351
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            207,647
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            1,281,998Net
      cash provided by/(used in) investing activities
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            1,074,351
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (44,952,353
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (43,878,002
                                                                                                                                                            )Cash
      flows from financing activitiesProceeds
      from notes and advances payable, InterAmerican Advisors,
    LLC
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            36,000
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            141,000Payments
      of notes and advances payable, InterAmerican Advisors, LLC
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (141,000
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (141,000
                                                                                                                                                            )Proceeds
      from note payable
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            69,650
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            69,650Payment
      of note payable
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (46,734
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (22,916
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (69,650
                                                                                                                                                            )Payment
      of costs of public offering
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (145,000
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (2,245,825
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (2,503,483
                                                                                                                                                            )Proceeds
      from private placement warrant sale
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            1,500,000
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            1,500,000Proceeds
      from sale of shares of common stock
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            15,000Proceeds
      from initial public offering
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            46,000,000
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            46,000,000Net
      cash provided by (used in) financing activities
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            (191,734
                                                                                                                                                            )
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            45,195,909
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            45,011,517Net
      increase in cash
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            5,240
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            15,093
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            20,773Cash
      at beginning of period
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            15,533
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            440
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            -Cash
      at end of period
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            20,773
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            15,533
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            20,773Supplemental
      schedule of non-cash financing activities:Accrual
      of deferred offering costs
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            153,484
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            8,484Accrual
      of deferred underwriting fees
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            2,070,000
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            2,070,000Supplemental
      cash flow information:Cash
      paid for interest
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            3,411
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            12,678
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            16,089Cash
      paid for income taxes
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            265,792
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            -
                                                                                                                                                            
                                                                                                                                                            
                                                                                                                                                            $
                                                                                                                                                            265,792
 See
      notes to consolidated financial
statements
  F-6
 Table of Contents
  InterAmerican Acquisition Group
Inc.
 (a
corporation in the development stage)
 
 
 Notes
to Consolidated Financial Statements
 December
31, 2008
 
 1.
              Organization,
      Business Operations and Summary of Significant Accounting
      Policies
 
 Organization,
Business Operations and Significant Accounting Policies
 
 The
consolidated financial statements include the accounts of InterAmerican
Acquisition Group Inc. (the ‘‘Company’’) and its wholly-owned subsidiary, CNC
Development Ltd. All intercompany transactions have been eliminated. The Company
was incorporated in Delaware on May 10, 2005 as a blank check company whose
objective is to acquire an operating business, as further described in Note 9
below. All activity through December 31, 2008 relates to the Company’s
formation, the public offering and its efforts to identify and consummate a
business combination as described below. In connection with the prospective
acquisition of an operating business (as further described in Note 9) the
Company formed its wholly-owned subsidiary, CNC Development Ltd. in the British
Virgin Islands on August 11, 2008. CNC Development Ltd. was formed for the
purpose of the business combination described in Note 9 and had no operations as
of December 31, 2008. The Company is considered to be in the development stage
and is subject to the risks associated with activities of development stage
companies.
 
 The
registration statement for the Company’s initial public offering (the
“Offering”) was declared effective September 4, 2007. The Company completed
the Offering, including the exercise of the underwriter’s overallotment option,
on September 10, 2007 and September 11, 2007, and received net proceeds of
approximately $41.4 million, which is net of $2,070,000 of deferred underwriting
discounts (as described in Note 2). The Company’s executive officers and
directors have broad discretion with respect to the specific application of the
net proceeds of the Offering of units, consisting of one share of the Company’s
common stock and one redeemable common stock purchase warrant (the “Units”) and
the private placement of 1,000,000 warrants that occurred immediately prior to
completion of the Offering (the “Private Placement”), although substantially all
of the net proceeds of the Offering and Private Placement are intended to be
generally applied toward consummating an initial merger, acquisition, asset
purchase or other such transaction (a “Business Combination”) with (or
acquisition of) one or more operating businesses. Furthermore, there is no
assurance that the Company will be able to successfully consummate an initial
Business Combination. An amount of $45,160,000, which includes $1,500,000
relating to the sale of warrants in the Private Placement and $2,070,000
deferred payment to the underwriters in the Offering, of the net
proceeds was deposited in a trust account (the “Trust Account”), as
further described in Note 2, until the earlier of (i) the consummation of
its initial Business Combination or (ii) the distribution of the Trust
Account as described below. The placing of funds in the Trust Account may not
protect those funds from third party claims against the Company. Although the
Company will seek to have all third parties the Company engages for services
rendered to it or products sold to it (which includes, for example, lawyers,
investment bankers, consultants and analysts), prospective target businesses or
other entities it engages, execute agreements with the Company waiving any
right, title, interest or claim of any kind in or to any monies held in the
Trust Account, there is no guarantee that they will execute such agreements. The
Company’s two executive officers, William Morro and Dr. Richard Sinkin have
severally (but not jointly) agreed that they will be personally liable,
severally (but not jointly), which means they will be personally liable only for
60% and 40% respectively (as an example, if there is a valid third party claim
of $1,000,000, Mr. Morro will be responsible for $600,000 of such claim and Dr.
Sinkin will be responsible for $400,000 of such claim), to pay claims of third
parties that are owed money for services rendered to the Company or products
sold to the Company (which includes, for example, accountants, lawyers,
investment bankers, consultants and analysts) that would reduce the amount of
the Trust Account, provided that such third party has not executed a valid and
enforceable waiver to rights or claims against the Trust Account and only to the
extent necessary to ensure that such claims do not reduce the amount in the
Trust Account. The indemnification provided by Messrs. Morro and Sinkin would
not cover tort claims brought against the Company for some unforeseen event,
claims against the Company brought by a target business for breach of contract,
or breach of a confidentiality agreement with a potential target. The Company
will bring an action against either of its executive officers in the event that
such individual asserts that he is not able to cover any of the expenses that
would deplete the trust proceeds or that either is not liable pursuant to their
indemnification obligations as described above. Based on the information
provided to the Company in the director and officer questionnaires provided to
the Company in connection with the Offering as well as the representations as to
their accredited investor status (as such term is defined in Regulation D), the
Company currently believes that such persons are of substantial means and
capable of funding their indemnity obligations. However, because the amount of
any such indemnification obligations cannot be estimated, the Company has not
asked Messrs. Morro or Sinkin to reserve for such an eventuality and there can
be no assurance that they will satisfy their indemnification obligations if and
when they arise. Accordingly, the proceeds held in trust could be subject to
claims which could take priority over the claims of the Company’s public
stockholders and the per-share liquidation price could be less than
approximately $7.85, plus interest (net of taxes payable and net of interest
earned on the trust account up to a maximum amount of $950,000 that will be
released to the Company to fund its working capital), due to claims of such
creditors. The remaining net proceeds (not held in the Trust Account) and
interest income earned on the funds in the Trust Account of up to $950,000,
after tax, may be released to the Company upon demand and may be used to pay for
business, legal and accounting due diligence on prospective acquisitions and
continuing general and administrative expenses. The Company has signed a
definitive agreement for the acquisition of a target business (Note 9) and will
submit such transaction for stockholder approval. In the event that stockholders
owning 20% or more of the shares sold in the Offering vote against the Business
Combination and exercise their redemption rights described below, the Business
Combination will not be consummated. All of the Company’s stockholders prior to
the Offering, including all of the officers, directors and special advisors of
the Company (‘‘Initial Stockholders’’), have agreed to vote their 1,250,000
founding shares of common stock (as well as any shares included in units
purchased in the Offering or in the aftermarket) in accordance with the vote of
the majority in interest of all other stockholders of the Company (‘‘Public
Stockholders’’) with respect to any Business Combination. After consummation of
a Business Combination, these voting safeguards will no longer be
applicable.
 
 F-7
 Table of Contents
 With
respect to a Business Combination which is approved and consummated, any Public
Stockholder who voted against the Business Combination may demand that the
Company redeem his or her shares. The per share redemption price will equal the
amount in the Trust Account (inclusive of the funds held in the trust account
for the benefit of the underwriters and the proceeds from management’s warrant
purchase but net of taxes payable and net of interest earned up to a maximum
amount of $950,000 that may be released from the trust account to meet working
capital needs), calculated as of two business days prior to the consummation of
the proposed Business Combination, divided by the number of shares of common
stock sold in our initial public offering. Accordingly, Public Stockholders
holding 19.99% of the aggregate number of shares owned by all Public
Stockholders may seek redemption of their shares in the event of a Business
Combination. Therefore, a portion of the net proceeds from the Offering (19.99%
of the amount placed in the Trust Account) has been classified as common stock
subject to possible redemption.
 
 The
Company’s amended and restated certificate of incorporation provides for the
liquidation of the Trust Account as part of any plan of dissolution and
distribution of the Company, in the event that the Company does not consummate a
Business Combination within 18 months from the date of the consummation of the
Offering, or 24 months from the consummation of the Offering if certain
extension criteria have been satisfied. There is no assurance that the Company
will be able to complete the Business Combination described in Note 9 within
that period. This factor, along with the liquidity factors described in Note 10
raise substantial doubt about the Company’s ability to continue as a going
concern. The accompanying financial statements are prepared assuming the Company
will continue as a going concern. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty. These
liquidation provisions, which are also contained in the agreement governing the
Trust Account, cannot be amended without the affirmative vote of 100% of the
Public Stockholders, nor can the certificate of incorporation be amended without
the affirmative vote of 95% of the shares sold in the Offering. In the event of
liquidation, it is likely that the per share value of the residual assets
remaining available for distribution (including Trust Account assets) will be
less than the initial public offering price per share in the Offering (assuming
no value is attributed to the Warrants, as defined below, contained in the Units
issued in the Offering discussed in Note 2).
 
 Income
Taxes
 
 Deferred
income taxes are provided for the differences between the bases of assets and
liabilities for financial reporting and income tax purposes. A valuation
allowance is established when necessary to reduce deferred tax assets to the
amount expected to be realized.
 
 Net
Income (loss) Per Common Share
 
 Net
income/(loss) per share is computed by dividing net income/(loss) by the
weighted-average number of shares of common stock outstanding during the period
after giving effect to stock splits and reverse stock splits. The effect of the
5,750,000 outstanding warrants issued in connection with the Offering and the
1,000,000 outstanding warrants issued in connection with the Private Placement
has not been considered in diluted income/(loss) per share calculations for the
year ended December 31, 2008 since such warrants are contingently
exercisable. The effect of the 185,000 outstanding warrants issued on May 21,
2008 as described in Note 4 has not been considered in diluted income/(loss) per
share calculations for the year ended December 31, 2008 since the effect
would have been antidilutive.
 
 Use
of Estimates
 
 The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the date of the financial statements and the reported amounts of
expenses during the reporting period. Actual results could differ from those
estimates.
 
 Cash
and Cash Equivalents
 
 The
Company maintains cash in bank deposit accounts which, at times, exceed
federally insured (FDIC) limits. The Company has not experienced any losses on
these accounts. For financial statement purposes, the Company considers all
highly liquid debt instruments purchased with an original maturity of three
months or less to be cash equivalents.
 
 F-8
 Table of Contents
 Fair
value of Financial Instruments
 
 The following methods and assumptions
are used to estimate the fair value of each class of financial instruments for
which it is practical to estimate:
 
 The fair value of the Company’s assets
and liabilities that qualify as financial instruments under SFAS No. 107
“Disclosures about Fair Value of Financial Instrument,” approximate their
carrying amounts presented in the balance sheet at December 31, 2008 and
2007.
 
 Recent
Accounting Pronouncements
 
 In
September 2006, FASB issued Statement of Financial Accounting Standards No. 157,
Fair Value Measurements (SFAS No. 157). SFAS No. 157 defines fair value,
establishes a framework for measuring fair value, and expands disclosures about
fair value measurement. SFAS No. 157 also emphasizes that fair value is a
market-based measurement, not an entity-specific measurement, and sets out a
fair value hierarchy with the highest priority being quoted prices in active
markets. Under SFAS No. 157, fair value measurements are disclosed by level
within that hierarchy. In February 2008, the FASB issued FASB Staff Position No.
157-2, Effective Date of FASB Statement No. 157, which permits a one-year
deferral for the implementation of SFAS No. 157 with regard to nonfinancial
assets and liabilities that are not recognized or disclosed at fair value in the
financial statements on a recurring basis. The Company adopted SFAS No. 157 for
the fiscal year beginning January 1, 2008, except for nonfinancial assets and
nonfinancial liabilities that are recognized or disclosed at fair value in the
financial statements on a nonrecurring basis for which delayed application is
permitted until our fiscal year beginning January 1, 2009. The adoption of the
remaining provisions of SFAS No. 157 is not expected to have a material impact
on the Company’s financial position, results of operations or cash
flows.
 
 In
December 2007, FASB released Statement of Financial Accounting Standards No.
141R, “Business Combinations” (“SFAS 141R”) that is effective for business
combinations for which the acquisition date is on or after the beginning of the
first annual reporting period beginning on or after December 15, 2008. The
pronouncement resulted from a joint project between the FASB and the
International Accounting Standards Board and continues the movement toward the
greater use of fair values in financial reporting. SFAS 141R is expected to
significantly change how future business acquisitions are accounted for and will
impact financial statements both on the acquisition date and in subsequent
periods.
 
 In
December 2007, FASB released Statement of Financial Accounting Standards No.
160, “Non-controlling Interests in Consolidated Financial Statements” (“SFAS
160”) that is effective for annual periods beginning on or after December 15,
2008. The pronouncement resulted from a joint project between the FASB and the
International Accounting Standards Board and continues the movement toward the
greater use of fair values in financial reporting. Upon adoption of SFAS 160,
the Company will reclassify any non-controlling interests as a component of
equity.
 
 In June
2008, the FASB ratified Emerging Issues Task Force (EITF) Issue No. 07-5,
“Determining Whether an Instrument (or Embedded Feature) is Indexed to an
Entity’s Own Stock” (“EITF 07-5”). EITF 07-5 mandates a two-step process for
evaluating whether an equity-linked financial instrument or embedded feature is
indexed to the entity’s own stock. It is effective for fiscal years beginning
after December 15, 2008 and interim periods within those fiscal years, which is
our first quarter of 2009. Any outstanding instrument at the date of adoption
will require a retrospective application of the accounting through a cumulative
effect adjustment to retained earnings upon adoption. The Company is currently
evaluating the impact that adoption of EITF 07-5 will have on its financial
statements.
 
 Management
does not believe that any other recently issued, but not yet effective,
accounting standards if currently adopted would have a material effect on the
accompanying financial statements.
 
 2.
              Initial
      Public Offering
 
 The
Company sold 5,750,000 Units at an offering price of $8.00 per Unit (750,000 of
which Units were sold in connection with the underwriters’ exercise of their
over-allotment option). Each “Unit” consists of one share of the Company’s
common stock and one Redeemable Common Stock Purchase Warrant (“Warrants”). Each
Warrant entitles the holder to purchase from the Company one share of common
stock at an exercise price of $5.00 commencing the later of the completion of a
Business Combination and one year from the effective date of the Offering and
expiring four years from the effective date of the Offering. The Company may
redeem the Warrants at a price of $0.01 per Warrant upon 30 days notice after
the Warrants become exercisable, only in the event that the last sale price of
the common stock is at least $10.00 per share for any 20 trading days within a
30-day period ending on the third day prior to the date on which notice of
redemption is given. The Company agreed to pay the underwriters in the Offering
an underwriting discount of 6% of the gross proceeds of the Offering and a
non-accountable expense allowance of 2% of the gross proceeds of the Offering
(excluding any over-allotment option proceeds). However, the underwriters have
agreed that, of this amount, 4.5% of the gross proceeds of the Offering will not
be paid unless and until the Company completes an initial Business Combination
and has waived its rights to receive such payment upon the Company’s liquidation
if the Company is unable to complete an initial Business
Combination.
 
 F-9
 Table of Contents
 The
Company has agreed with the representative of the underwriters to use its best
efforts to maintain the effectiveness of the registration statement applicable
to the Warrants until their expiration. If the Company is unable to maintain the
effectiveness of such registration statement until the expiration of the
Warrants, and therefore is unable to deliver registered shares, the Company will
not be required to net cash settle the Warrants and the Warrants may become
worthless.
 
 3.
              Trust
      Account
  Investments
held in trust at December 31, 2008 are invested in a money market fund meeting
conditions of the Investment Company Act of 1940. Continental Stock Transfer and
Trust Company is the trustee and the trust account is maintained by the trustee
at JP Morgan Chase New York Bank. The Company is permitted to draw up to
$950,000 of after-tax interest to meet its needs for operating expenses and
working capital. The Company is also permitted to draw from interest earned on
the Trust Account without restriction to pay taxes. The reconciliation of
investments held in trust as of December 31, 2008 and 2007 is as
follows:
  December
      31, 2008
                          
                          
                          December
      31, 2007Contribution
      to trust
                          
                          $
                          45,160,000
                          
                          
                          
                          45,160,000Interest
      income received
                          
                          
                          1,282,415
                          
                          
                          
                          426,573Accrued
      interest income
                          
                          
                          44,190
                          
                          
                          
                          138,657Withdrawals
      to pay taxes
                          
                          
                          (408,900
                          )
                          
                          
                          (7,500
                          )Withdrawals
      to fund operations (a)
                          
                          
                          (873,100
                          )
                          
                          
                          (200,147
                          )Investments
      and accrued interest held in trust
                          
                          $
                          45,204,605
                          
                          
                          $
                          45,517,583(a)  Limited
      to $950,000
  4.
              Accounts
      Payable and Accrued Expenses
 
 Accounts
payable and accrued expenses consist of the following components as of December
31, 2008 and December 31, 2007:
  December
      31, 2008
                        
                        
                        December
      31, 2007Amounts
      due for offering-related expenses
                        
                        $
                        8,484
                        
                        
                        $
                        153,484Other
                        
                        
                        598,399
                        
                        
                        
                        50,049Total
                        
                        $
                        606,883
                        
                        
                        $
                        203,533
 5.
              Notes
      Payable
 
 The
Company issued a $75,000 unsecured promissory note to InterAmerican Advisors,
LLC (‘‘InterAmerican’’), an affiliate of certain of its Initial Stockholders, on
May 27, 2005, issued a $15,000 unsecured promissory note to InterAmerican on
July 6, 2006, issued an additional $15,000 unsecured promissory note to
InterAmerican on November 6, 2006, issued an additional $6,500 unsecured
promissory note to InterAmerican on March 1, 2007 and issued an additional
$29,000 unsecured promissory note to InterAmerican on June 25, 2007. In
accordance with their terms, the notes were repaid in full on September 10, 2007
together with interest at the rate of 6% per annum for the amount of $12,678
from the date of issue.
 
 Effective
September 9, 2007, the Company entered into an unsecured financing agreement for
its insurance premiums with an unaffiliated finance company in the amount of
$69,650 and an annualized interest rate of 7.07%. The first principal payment of
$22,916 was paid in November 2007 and the second principal payment of $23,129
was paid in February 2008 and the final principal payment of $23,605 was paid in
May 2008.
 
 F-10
 Table of Contents
  6.
              Fair Value of Financial
      Instruments
  Effective
January 1, 2008 the Company adopted Statement No. 157, Fair Value
Measurements.  Statement No. 157 applies to all assets and
liabilities that are being measured and reported on a fair value
basis.  Statement No. 157 requires new disclosure that establishes a
framework for measuring fair value in generally accepted accounting principles,
and expands disclosure about fair value measurements.  This statement
enables the reader of the financial statements to assess the inputs used to
develop those measurements by establishing a hierarchy for ranking the quality
and reliability of the information used to determine fair values.  The
statement requires that assets and liabilities carried at fair value will be
classified and disclosed in one of the following three categories:
 
 Level
      1:
              Quoted
      market prices in active markets for identical assets or
      liabilities;
 Level
      2:
              Observable
      market based inputs or unobservable inputs that are corroborated by market
      data;
 Level
      3:
              Unobservable
      inputs that are not corroborated by market
data.
  In
determining the appropriate levels, the Company performs a detailed analysis of
the assets and liabilities that are subject to Statement No. 157.  At
each reporting period, all assets and liabilities for which the fair value
measurement is based on significant unobservable inputs are classified as Level
3.
  The table
below presents the balances of assets and liabilities measured at fair value on
a recurring basis by level within the hierarchy.
  December
      31, 2008Total
                                    
                                    
                                    Level
      1
                                    
                                    
                                    Level
      2
                                    
                                    
                                    Level
      3Investments
      (including accrued interest) held in trust
                                    
                                    $
                                    45,204,605
                                    
                                    
                                    $
                                    45,204,605
                                    
                                    
                                    $
                                    -
                                    
                                    
                                    $
                                    -Total
      assets
                                    
                                    $
                                    45,204,605
                                    
                                    
                                    $
                                    45,204,605
                                    
                                    
                                    $
                                    -
                                    
                                    
                                    $
                                    -
   The
Company’s restricted funds held in trust, including accrued interest, are
invested as described in Note 3 above and this investment is considered to be
highly liquid and easily tradable.
  7.
              Commitments
      and Related Party Transactions
 
 The
Company presently occupies office space provided by an affiliate of several of
the Initial Stockholders. Such affiliate has agreed that, until the Company
consummates a Business Combination, it will make such office space, as well as
certain office and secretarial services, available to the Company, as may be
required by the Company from time to time. The Company has agreed to pay such
affiliate $10,000 per month for such services for up to 12 months commencing on
the effective date of the Offering. The statement of Operations for the year
ended December 31, 2008, the year ended December 31, 2007 and the period from
May 10, 2005 (inception) to December 31, 2008 includes $83,667, $36,333 and
$120,000 respectively related to this agreement.
 
 Pursuant
to letter agreements dated June 27, 2007 with the Company and the representative
for the underwriters, the Initial Stockholders have waived their right to
receive distributions with respect to their founding shares upon the Company’s
liquidation.
 
 Immediately
prior to the consummation of the Offering on September 10, 2007, Sintrim Capital
Corporation, an affiliate of InterAmerican Capital Partners II LLC, an entity
wholly-owned by certain of the Company’s executive officers, together with one
of the Company’s special advisors, purchased $1,500,000 of warrants from the
Company at a purchase price of $1.50 per warrant, each to purchase one share of
the Company’s common stock. Sintrim Capital Corp and one of the Company’s
special advisors have further agreed that the warrants purchased by them
pursuant to this agreement will not be sold or transferred, except to one or
more affiliates, until after the Company has completed a Business Combination.
The proceeds from the sale of the warrants was deposited into the Trust Account
and is part of the amount payable to the Public Stockholders in the event of the
liquidation of the Trust Account as part of the Company’s plan of dissolution
and distribution. Similarly, the purchase price will become part of any
redemption amount paid to redeeming stockholders. The warrant purchase agreement
also grants certain registration rights to Sintrim Capital Corp., InterAmerican
Capital Partners II LLC and one of the Company’s special advisors with respect
to the warrants purchased and the shares of our common stock issuable upon
exercise of the warrants.
 
 F-11
 Table of Contents
 The
Initial Stockholders are entitled to registration rights with respect to their
founding shares pursuant to an agreement to be signed prior to or on the
effective date of the Offering. The holders of the majority of these shares are
entitled to make up to two demands that the Company register these shares at any
time commencing three months prior to the third anniversary of the effective
date of the Offering. In addition, the Initial Stockholders have certain
‘‘piggy-back’’ registration rights on registration statements filed subsequent
to the third anniversary of the effective date of the Offering.
 
 We issued
to certain of our founding stockholders warrants to purchase an aggregate of
185,000 shares of our common stock, pursuant to agreements dated as of May 21,
2008. Subsequently, as required by Amendment No. 1 to the stock purchase
agreement, the recipients have agreed to cancel 129,150 of those warrants upon
consummation of the Business Combination described in Note 9; as of December 31,
2008 all such warrants remained outstanding and none were exercised. Under the
terms of the May 21, 2008 warrant agreements, the warrants are immediately
exercisable at an exercise price of $.01 and expire on the earlier of (x) January 31, 2009 if a
Business Combination is consummated in 2008 or 90 days after the consummation of
a Business Combination if such Business Combination occurs in 2009 or (y)
September 4, 2009. The warrants are subject to the same restrictions as the
original shares held by the Company’s founding stockholders, including the
restriction from selling or transferring the warrants, or any common stock
underlying them, until September 4, 2009 (the “Restricted Period”). During the
Restricted Period, no sale or transfer or other disposition of the warrants, or
any common stock underlying them, can be made except for certain limited
exceptions as set forth in the warrant agreements. The issuance of the warrants
on May 21, 2008 was made pursuant to the exemption from the registration
provisions of the Securities Act of 1933, as amended (the “Securities Act”),
provided by Section 4(2) of the Securities Act and Regulation D promulgated
thereunder. The warrants and underlying common stock have not been registered
under the Securities Act and may not be offered or sold in the United States
absent registration or an applicable exemption from registration requirements.
The value of the warrants was determined by our board of directors to be
$783,860 ($4.24 per warrant) based on an assessment of fair value provided by a
third-party appraiser who utilized a Black-Scholes model, although the
assumptions used as inputs in the Black-Scholes model (volatility, risk-free
rates and expected term) are not considered significant since variations of
these assumptions have little to no effect on the fair value, the resulting fair
value of the warrant being the differential between the fair value of the
underlying share and the exercise price of the warrant. The fair value of the
common share underlying the warrant was discounted for post-vesting
restrictions. As noted above, neither the warrants or the underlying common
shares can be sold or transferred, except for limited circumstances during the
Restriction Period and the common shares have no rights to the amounts in the
Trust Account upon liquidation. The discounts for the post-vesting restrictions
were estimated by applying a probability to our successful completion of a
Business Combination and discounting the resulting value for trading
restrictions and illiquidity following the prospective exercise of the options.
A tax deduction for such expense will be available to us at such time as the
options are exercised by the holders (if ever). If we successfully conclude a
Business Combination, we believe that the exercise of the options is highly
likely. However, because of uncertainty about the exercise of the options, we
have taken a reserve of 100% for deferred taxes associated with the option
expense.
 
 8.
              Stockholders’
      Equity
 
 Common
Stock
 
 On
December 7, 2005, the Company effected a 2-for-5 reverse stock split of its
shares of common stock. On April 26, 2006, the Company effected a 1.25-for-1
stock split of its shares of common stock. On May 26, 2006, the Company effected
a 1.44-for-1 stock split of its shares of common stock. On June 27, 2007, the
Company effected a 1-for-2.16 reverse stock split of its shares of common stock.
All references in the accompanying financial statements to the number of shares
of common stock and income (loss) per share have been retroactively restated to
reflect these transactions.  At December 31, 2008, a total of
6,935,000 shares of common stock were reserved for issuance upon the exercise of
outstanding warrants.
 
 Preferred
Stock
 
 The
Company is authorized to issue 1,000,000 shares of preferred stock with such
designations, voting and other rights and preferences as may be determined from
time to time by the Board of Directors.
 
 9.
              Income
      Taxes
 
 The
provision for income taxes consists of the following:
 
  
 F-12
 Table of Contents
  Year
      Ended
                                December
      31, 2008
                              
                              
                              Year
      Ended
                                December
      31, 2007Current:Federal
                              
                              $
                              190,034
                              
                              
                              $
                              122,155State
                              
                              
                              54,200
                              
                              
                              
                              35,533Deferred:Federal
                              
                              
                              (137,390
                              )
                              
                              
                              (57,610
                              )State
                              
                              
                              -
                              
                              
                              
                              -Total
                              
                              $
                              106,844
                              
                              
                              $
                              100,078
 The
majority of the Company’s operating expenses are not currently deductible for
income tax purposes. These expenses will be deductible for income tax purposes
over a period of time when a trade or business, as defined in the Internal
Revenue Code, begins operations or in the event the Company liquidates. The
deferred tax asset relates to the future benefit the Company will receive when
it is able to deduct these costs for income tax purposes.
 
 The
effect of the temporary differences that make up the deferred tax assets are as
follows:
  December
      31, 2008
                          
                          
                          December
      31, 2007Effect
      of expenses deferred for purposes of calculating income
tax
                          
                          
                          808,940
                          
                          
                          
                          67,563Valuation
      allowance
                          
                          
                          (613,940
                          )
                          
                          
                          (9,953
                          )Total
                          
                          $
                          195,000
                          
                          
                          $
                          57,610
 The total
provision for income taxes differs from that amount which would be computed by
applying the U.S. Federal tax rate to income before provision for income taxes
as follows:
  Period
      ended
                            December 31,
      2008
                          
                          
                          Period
      ended
                            December 31,
      2007Statutory
      federal income tax rate
                          
                          
                          (34.0
                          )%
                          
                          
                          34.0
                          %State
      and local income tax rate
                          
                          
                          (5.8
                          )%
                          
                          
                          5.9
                          %Effect
      of permanent differences
                          
                          
                          0.1
                          %
                          
                          
                          0.0
                          %Change
      in valuation allowance
                          
                          
                          48.2
                          %
                          
                          
                          0.0
                          %Effective
      income tax rate
                          
                          
                          8.5
                          %
                          
                          
                          39.9
                          %
 Because
of limitations on loss carrybacks applicable to state income taxes, the Company
recorded a valuation reserve for all of its deferred state tax assets at
December 31, 2008 and December 31, 2007. In recognition that it may not be able
to recover its federal deferred tax asset in excess of federal taxes previously
paid, the Company recorded a valuation allowance sufficient to meet this
condition for federal tax assets at December 31, 2008.  There was no
valuation allowance against federal deferred tax assets at December 31,
2007.
 
 There
have been no audits of the Company’s tax returns since inception and all years
remain open to examination.
 
 10.
              Proposed
      Merger
 
 Effective
May 15, 2008, the Company became party to a definitive stock purchase agreement
to acquire 89.6% of the fully-diluted shares of Sing Kung, Limited, a
privately-held company based in the British Virgin Islands that provides city
planning, infrastructure development, urban land improvement, and older-city
redevelopment to municipalities in China (“Sing Kung”). The stock purchase
agreement was amended as of November 28, 2008. Sing Kung was formed in the
British Virgin Islands in 2007 for the sole purposes of acquiring a 100%
interest in Century City Infrastructure Co. Ltd. (“Century City”). Century City
was also formed in 2007 and registered as a wholly-owned foreign enterprise in
China, for the purpose of acquiring a 100% interest in Shanghai New Century City
Development, Ltd. (“SNC”), which is the entity through which Sing Kung conducts
most of its business in China. The acquisition of SNC by Century City was
completed on December 8, 2008, but prior thereto (from December 27, 2007)
Century City controlled and had a 100% economic interest in SNC as a result of
agreements that executed between Century City and the SNC
stockholders.
 
 F-13
 Table of Contents
 Pursuant
to the stock purchase agreement, as amended, IAG formed a subsidiary, CNC
Development Ltd. (“CNC”) in the British Virgin Islands on August 11, 2008. Upon
the closing of the acquisition, subject to the approval of the Company’s
stockholders, the stock purchase agreement calls for the simultaneous
redomestication of IAG from the State of Delaware to the British Virgin Islands,
through a merger of the Company into CNC. The Sing Kung stockholders that are
party to the stock purchase agreement will receive in the aggregate (i)
19,843,417shares of CNC common stock plus (ii) the right to
receive an additional 12.4 million shares if the following net income targets
are met in each of the years shown below:
 
 Year
      ending December 31,
                      
                      Net
      Income2009
                      
                      $56,000,0002010
                      
                      $80,000,0002011
                      
                      $112,000,0002012
                      
                      $151,200,000
 
 CNC also
intends to make an exchange offer of one share of CNC common stock for each of
the remaining 2,548,718 Sing Kung common shares and 2,915,000 preferred shares
that are held by Sing Kung Stockholders who are not parties to the stock
purchase agreement. If all such shareholders who are not party to the stock
purchase agreement participate in the exchange offer, they will receive an
aggregate of 3,761,844 common CNC shares. The acquisition is expected to be
consummated in the second quarter of 2009, after the required approval by the
Company’s stockholders and the fulfillment of certain other closing conditions.
Following the closing of the transaction, the post-transaction public company
will be renamed China New City Construction Co. Ltd. In addition, the Company
will seek to list its shares on The NASDAQ Stock Market.
 
 Recent
changes in market conditions have increased the risk the acquisition of Sing
Kung cannot be completed on the terms set forth in the stock purchase agreement,
as amended.
 
 The
Company has incurred and expensed approximately $637,881 of costs related to the
proposed transaction with Sing Kung as of December 31, 2008. For a more complete
discussion of our proposed Business Combination, see our proxy statement/prospectus on Form S-4,
as amended.
 
 11.
              Liquidity
 
 In
addition to those initial proceeds not deposited in the trust fund, we are
permitted to deduct up to $950,000 of interest income from the trust fund to
fund our working capital requirements and the costs of pursuing a Business
Combination. Additional withdrawals from interest earned on the trust fund are
permitted to pay taxes. As of December 31, 2008 we had withdrawn $873,100 of the
amount permitted for working capital purposes, leaving $76,900 to be withdrawn
if there is sufficient interest income to do so. As of December 31, 2008, we had
liabilities, other than taxes payable and deferred underwriting fees, net of
cash, equal to $606,883, an amount that exceeds the sum of our cash held outside
of the trust plus our potential available working capital draw by $509,210.
Despite this working capital deficiency, based on the arrangements we have made
with certain of our vendors and advisors for payment following the consummation
of the Sing Kung stock purchase if it is consummated, we believe we have
sufficient resources to complete the transaction if it is approved by our
stockholders.
 
 If the
Business Combination with Sing Kung is not consummated, we do not believe that
we will have sufficient available funds (outside of the trust fund) to operate
through September 10, 2009, or to pursue an alternative transaction without
needing to raise additional funds from our officers, directors,
stockholders or other available sources. We have no commitments for such
borrowings at this time and there is no assurance that we will be able to raise
additional funds needed to meet the expenditures required for operating our
business beyond the expected date for consummation of the Sing Kung
acquisition.
 
 F-14
 Table of Contents
   SIGNATURES
 
 Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, as amended, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
  INTERAMERICAN
      ACQUISITION GROUP, INC.By:
                    /s/ William
      C. MorroName:    
      William C. Morro
                      Title:      
      Chairman, Chief Executive Officer and
                      Chief
      Financial Officer (principal executive officer)
   Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.