UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION
 WASHINGTON,
D.C. 20549
  FORM
10-K
 
 x
      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
      ACT OF 1934
 
 For
the fiscal year ended December 31, 2007
 
 or
 
 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: 001-33075
 
 Granahan
McCourt Acquisition Corporation
  (Exact
name of registrant as specified in its charter)
 Delaware
              
              02-0781911(State
      or Other Jurisdiction of
                Incorporation
      or Organization)
              
              (I.R.S.
      Employer
                Identification
      No.)179
      Stony Brook Road
                Hopewell,
      NJ
              
              08525(Address
      of Principal Executive Offices)
              
              (Zip
      Code)
  Registrant’s
telephone number, including area code:(609) 333-1200
 
 Securities
registered pursuant to Section 12(b) of the Act:
 Title
      of Each Class
              
              Name
      of Each Exchange on Which RegisteredUnits
              
              American
      Stock ExchangeCommon
      Stock, par value $0.0001 per share
              
              American
      Stock ExchangeWarrants
              
              American
      Stock Exchange
  Securities
registered pursuant to Section 12(g) of the Act: None
 
 Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.   Yes o    No x
 
 Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Act.   Yes o    No x
 
 Indicate
by check mark whether the registrant: (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.   Yes x    No 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 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.  x
 
 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
definition of “accelerated filer” ,“large accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
 Large
      Accelerated Filer     o  
      Accelerated Filer x     Smaller
      Reporting Company o   
      Non-Accelerated Filer o
 
 
  Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).   Yes x    No o
 
 As of
June 30, 2007, the aggregate market value of the registrant’s common stock held
by non affiliates of the registrant was $65,981,250.
 
 Number of
shares of common stock outstanding as of March 14, 2008:
14,062,500.
 
 
  Table of
Contents
 
 TABLE
OF CONTENTS
 Item
              
              Description
              
              PagePART IITEM 1.
              
              BUSINESS
              
              1ITEM 1A.
              
              RISK FACTORS
              
              7ITEM 1B.
              
              UNRESOLVED STAFF COMMENTS
              
              19ITEM 2.
              
              PROPERTIES
              
              19ITEM 3.
              
              LEGAL PROCEEDINGS
              
              19ITEM 4.
              
              SUBMISSION OF MATTERS TO A VOTE OF SECURITY
      HOLDERS
              
              19PART IIITEM 5.
              
              MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED
      STOCKHOLDERMATTERS AND ISSUER
      PURCHASES OF EQUITY SECURITIES
              
              19ITEM 6.
              
              SELECTED FINANCIAL DATA
              
              22ITEM 7.
              
              MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
      CONDITION ANDRESULTS OF
      OPERATIONS
              
              23ITEM 7A.
              
              QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
      MARKET RISK
              
              24ITEM 8.
              
              FINANCIAL STATEMENTS AND SUPPLEMENTARY
      DATA
              
              24ITEM 9.
              
              CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
      ACCOUNTING ANDFINANCIAL
      DISCLOSURE
              
              24ITEM 9A.
              
              CONTROLS AND PROCEDURES
              
              24ITEM 9B.
              
              OTHER INFORMATION
              
              25PART IIIITEM 10.
              
              DIRECTORS AND EXECUTIVE OFFICERS OF THE
      REGISTRANT
              
              25ITEM 11.
              
              EXECUTIVE COMPENSATION
              
              28ITEM 12.
              
              SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
      AND MANAGEMENT ANDRELATED
      STOCKHOLDER MATTERS
              
              29ITEM 13.
              
              CERTAIN RELATIONSHIPS AND RELATED
      TRANSACTIONS
              
              31ITEM 14.
              
              PRINCIPAL ACCOUNTANT FEES AND
      SERVICES
              
              33PART IVITEM 15.
              
              EXHIBITS AND FINANCIAL STATEMENT
      SCHEDULES
              
              34SIGNATURES
              
              35
  
 CAUTIONARY
STATEMENT CONCERNING FORWARD-LOOKING INFORMATION
 
 This
report includes forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933, as amended (the “Securities
Act”), and Section 21E of the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), that involve substantial risks and uncertainties. We have
based these forward-looking statements on our current expectations, estimates
and projections about our target industries, our beliefs, our assumptions and
future events. These forward-looking statements are subject to known and unknown
risks, uncertainties and assumptions about us that may cause our actual results,
levels of activity, performance or achievements to be materially different from
any future results, levels of activity, performance or achievements expressed or
implied by such forward-looking statements. In some cases, you can identify
forward-looking statements by terminology such as “may,” “should,” “could,”
“would,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “continue,” or
the negative of such terms or other similar expressions. Factors that might
cause or contribute to such a discrepancy include, but are not limited to, those
described in this report, including in “Item 1A. Risk Factors”, and our other
Securities and Exchange Commission (“SEC”) filings, and the
following:
 
 •
                  our
      status as a development stage
company;
 
 •
                our
      ability to dissolve and liquidate in a timely
  manner;
 
 •
                our
      failure to receive necessary regulatory consents, or to receive them in a
      timely manner, in connection with our initial business
      combination;
 
 •
                our
      dissolution or liquidation prior to a business
  combination;
 
 •
                the
      reduction of the proceeds held in the trust account due to third party
      claims;
 
 •
                our
      selection of a prospective target business or
  asset;
 
 •
                our
      issuance of our capital stock or incurrence of debt to complete a business
      combination;
 
 •
                our
      ability to consummate an attractive business combination due to our
      limited resources and the significant competition for business combination
      opportunities;
 
 •
                our
      dependence on our key
personnel;
 
 •
                the
      tax consequences of an acquisition or disposition by
  us;
 
 •
                conflicts
      of interest of our officers and
directors;
 
 •
                potential
      future affiliations of our officers and directors with competing
      businesses;
 
 •
                our
      ability to obtain additional financing if
  necessary;
 
 •
                the
      control by our initial stockholders of a substantial interest in
      us;
 
 •
                our
      common stock becoming subject to the SEC’s penny stock
    rules;
 
 •
                the
      adverse effect the outstanding warrants may have on the market price of
      our common shares;
 
 •
                the
      existence of registration rights with respect to the securities owned by
      our initial stockholders;
 
 •
                our
      being deemed an investment
company;
 
 •
                the
      lack of adequate resources to cover our operating
  expenses;
 
 •
                the
      lack of a market for our
securities;
 
 •
                market
    risks;
 
 •
                regulatory
      risks and operational risks, including those involved in operating outside
      the United States;
 
 •
                loss
      of our intellectual property
rights;
 
 •
                foreign
      currency fluctuation;
 
 •
                limited
      operating histories of businesses we may acquire in the telecommunications
      and media industries;
 
 •
                cyclicality
      of the telecommunications and media industries;
  and
 
 •
                our
      failure to keep pace with changes in our target
  industries.
 
 These risks and
others described below under “Risk Factors” are not
exhaustive.
 
 
  PART
I
 
 ITEM 1.  BUSINESS
 
 Introduction
 
 Granahan
McCourt Acquisition Corporation is a blank check company that was organized
under the laws of the State of Delaware on July 10, 2006. We were formed
for the purpose of acquiring, or acquiring control of, one or more assets or
operating businesses in the telecommunications and media industries through a
merger, capital stock exchange, asset or stock acquisition or other similar
business transaction, which we refer to as a “business combination.” We have not
generated revenue to date. We are considered to be in the development stage and
are subject to the risks associated with activities of development stage
companies. Since our initial public offering in October 2006, we have been
actively engaged in identifying a suitable business combination candidate. We
have met with potential target companies, service professionals and other
intermediaries to discuss our company, the background of our management and our
combination preferences. However, as of the date of filing of this report, we
have not entered into a definitive agreement for, nor consummated, any business
combination. Unless the context otherwise requires, references in this report to
“the Company,” “we,” “us,” and “our” refer to Granahan McCourt Acquisition
Corporation.
 
 A
registration statement for our initial public offering was declared effective on
October 18, 2006. On October 24, 2006, we sold 11,250,000 units in our initial
public offering. Each of our units consists of one share of our common stock,
$0.0001 par value per share, and one warrant. Each warrant sold in the initial
public offering entitles the holder to purchase from us one share of common
stock at an exercise price of $6.00. Our units began public trading on October
19, 2006.  Our warrants and common stock have traded separately since
November 27, 2006.  We received net proceeds of $87,150,000 from our
initial public offering and the sale of warrants to David C. McCourt in a
private placement. Of those net proceeds, approximately $85,050,000 (plus an
additional $3,600,000 attributable to a deferred underwriters’ discount) has
been placed in a trust account and will not be released until the earlier of (i)
the completion of an initial transaction or (ii) our liquidation. Therefore,
unless and until an initial transaction is consummated, the proceeds held in the
trust account will not be available to us.  For a more complete discussion
of our financial information, see the section appearing elsewhere in this Annual
Report on Form 10-K entitled “Selected Financial Data”.
 
 We will
focus our investment activities on the telecommunications and media industries.
Based on our management team’s experience in buying, building, restructuring and
operating businesses, we will seek to acquire one or more companies in sectors
where we believe there are opportunities for value creation as a result of
technological or regulatory changes and where we can leverage the expertise of
our management team. We are focusing our efforts in North America, Europe and
Israel, where our management has direct investment experience and a network of
industry contacts to source transaction opportunities. We believe there is an
opportunity to capitalize on technologies and business models that are
transferable across geographies, which is one of the strategies we intend to
pursue.
 
 Telecommunications
and Media Companies
 
 We
anticipate that our initial business combination may include, but will not be
limited to, one or more companies engaged in one or more of the following three
sectors of the telecommunications and media industries:
  ·
                Network
      Providers: including established wire line, established wireless and
      alternative technology access providers, as well as traditional phone,
      cable and broadband providers.
  ·
                Transport
      Providers: including Internet Protocol, or IP, infrastructure providers
      such as data center and co-location facilities for facilitating hosting,
      peering, interconnection, and other managed services, as well as content
      distribution providers and IP routing
companies.
  ·
                Application
      and Content Providers: including new bandwidth-intensive products and
      services in the entertainment and gaming sectors such as TV over the
      internet and broadband interactive gaming, as well as broadcasters,
      traditional networks, channel operators and content
  owners.
 Effecting
a Business Combination
 
 Fair
market value of initial business combination
 
 Our
initial business combination must have a fair market value equal to at least 80%
of our net assets (excluding the amount held in trust representing a portion of
the underwriters’ discount) at the time of the business combination. We intend
to accomplish this by identifying and effecting a business combination with one
or more telecommunications and media-related businesses
contemporaneously.
 
 1
 We
believe that an investment in a telecommunications and media-related business in
the size range of our initial public offering will provide a sufficient
“critical mass” upon which to develop a productive and profitable business in
the telecommunications and media industries. Our initial business combination
with a telecommunications and media-related business could be structured in one
of the following ways:
  ·
                a
      merger with one or more operating businesses in which the aggregate fair
      market value is equal to at least 80% of our net assets (excluding the
      amount held in trust representing a portion of the underwriters’ discount)
      at the time of the business
combination;
  ·
                an
      acquisition of a controlling interest in one or more telecommunications
      and media-related businesses in which the aggregate fair market value is
      equal to at least 80% of our net assets (excluding the amount held in
      trust representing a portion of the underwriters’ discount) at the time of
      the business combination; or
  ·
                an
      acquisition of certain assets and related liabilities of an existing
      telecommunications and media-related business of which the aggregate fair
      market value is equal to at least 80% of our net assets (excluding the
      amount held in trust representing a portion of the underwriters’ discount)
      at the time of the business
combination.
 If our
board is not able to independently determine that a proposed business
combination with one or more target businesses has a sufficient fair market
value or if a conflict of interest exists, such as if management selects a
company affiliated with one of our directors as a prospective target business,
we will obtain an opinion from a third-party appraiser and/or an independent
investment banking firm regarding the fairness to our stockholders from a
financial point of view of the business combination. However, we will not be
required to obtain an opinion from such firms as to the business combination if
our board of directors independently determines that the target businesses have
sufficient fair market value and no actual or perceived conflict of interest
exists.
 
 We
have not consummated any business combination
 
 We have
met with target companies, service professionals and other intermediaries to
discuss our company, the background of our management and our combination
preferences. However, as of the date of filing of this report, we have not
entered into a definitive agreement for, nor consummated, any business
combination. Subject to the requirement that our initial business combination
must be with one or more telecommunications and media-related businesses with an
aggregate fair market value equal to at least 80% of our net assets (excluding
the amount held in trust representing a portion of the underwriters’ discount)
at the time of the business combination, we have virtually unrestricted
flexibility in identifying and selecting prospective target business candidates
in the telecommunications and media industries. Accordingly, investors have no
basis to evaluate the possible merits or risks of the target businesses with
which we may ultimately complete a business combination. Our acquisition
criteria are similar to those of other blank check companies, except that we
intend to acquire telecommunications and media-related businesses.
 
 Sources
of target businesses
 
 Target
business candidates have been, and we anticipate that target business candidates
will continue to be, brought to our attention by various unaffiliated sources,
including private equity funds, companies, investment bankers and advisory firms
that specialize in the telecommunications and media business. These persons may
present solicited or unsolicited proposals to us. In addition, our directors and
officers have generated, and we anticipate that our directors’ and officers’
experience and their business contacts will continue to generate, other
proposals. We may engage the services of professional firms that specialize in
acquisitions, in which event we may pay a finder’s fee or other compensation.
Any finder’s fee or compensation would be subject to arm’s-length negotiations
between us and any of these professional firms and will likely be paid only upon
the consummation of a business combination. We will not pay any of our
directors, officers or pre-initial public offering stockholders (“initial
stockholders”) or any entity of which they are an officer, director or principal
stockholder, any finder’s fee or other compensation for services rendered to us
prior to, or in connection with, the consummation of our initial business
combination.  However, such individuals will receive reimbursement, subject
to board approval, for any out-of-pocket expenses incurred by them in connection
with activities on our behalf, such as identifying potential target
acquisitions, performing business due diligence on suitable target acquisitions
and business combinations, as well as traveling to and from the offices, plants
or similar locations of prospective target acquisitions to examine their
operations. In addition, David C. McCourt, our President, CEO and Chairman,
may, in his sole discretion, transfer our securities held by him to our existing
officers and directors who participate in the due diligence, structuring and
negotiating of a business combination.
 
 Selection
of target businesses and structuring of a business combination
 
 Our
management team has developed a comprehensive due diligence process for
evaluating the financial, sales and marketing, engineering, network operations,
customer service, back-office operations, compensation and benefits, information
technology and other critical organizational functions of target companies in
the telecommunications and media sectors. We will favor specific sectors and
geographies where we believe our management team can add value based on its
operational expertise and past track record. Although we will not limit the
sectors we target, our current focus includes telecommunications infrastructure
and networking companies servicing residential or enterprise customers,
traditional cable, phone and internet providers, traditional media, new
media
 
 2
 and
content companies, as well as applications and application service providers or
internet related technologies. Although we will not limit the geographic areas
we target, our current focus includes North America, Europe and Israel. We are
focusing our efforts on potential targets that have one or several of the
following characteristics:
  ·
                An
      existing under-capitalized business with the potential to further grow
      products and services in multiple
geographies;
 
 ·
                An
      existing business with strong fundamentals in an environment requiring
      scale, which has caused the business to appear undervalued or
      distressed;
 
 ·
                A
      partial product or service offering that may require a business
      combination to augment and complete the product service or
      solution;
  ·
                A
      valuable asset embedded in an underperforming business which could be made
      more valuable through improved management, technology, or enhanced
      operational efficiency; and/or
  ·
                An
      existing business requiring a non-traditional business model in order to
      adapt to the changing regulatory and technological environment and unlock
      stockholder value.
  While we
may seek to effect business combinations with more than one business, our
initial business combination must be with a business or businesses whose
collective fair market value is at least equal to 80% of our net assets
(excluding the amount held in the trust account representing a portion of the
underwriters’ discount) at the time of such business combination. Consequently,
it is likely that we will have the ability to complete only a single transaction
at first, although this may entail simultaneous transactions with several
operating businesses. If we determine to simultaneously engage in a business
combination with several operating businesses and these businesses are owned by
different persons, each of these persons will have to agree that our transaction
with its business is contingent on the simultaneous closings of the other
transactions. This requirement may make it more difficult for us, and delay our
ability, to complete the business combination. With multiple transactions, we
could also face additional risks, including additional burdens and costs with
respect to possible multiple negotiations and due diligence investigations (if
there are multiple counterparties) and the additional risks associated with the
subsequent assimilation of the operations, services and products of the various
companies in a single operating business.
 
 Limited
ability to evaluate the target business’ management
 
 We
closely scrutinize the management of prospective target businesses when
evaluating the desirability of effecting a business combination. However, given
the uncertainties associated with any third-party due diligence investigation,
our assessment of the target business’ management may not be complete and
accurate. In addition, the target business’ management may not have the
necessary skills, qualifications or abilities to manage a public company upon
the consummation of our initial business combination. Furthermore, the future
role, if any, of our existing management in the target businesses cannot
presently be stated with any certainty.
 
 Following
a business combination, we may seek to recruit additional management to
supplement the incumbent management of the target business or businesses. We
cannot assure you that we will have the ability to recruit additional
management, or that the additional management will have the requisite skills,
knowledge or experience necessary to enhance the incumbent
management.
 
 Possible
lack of business diversification
 
 It is
possible that our initial business combination may be with a target business
that has only a limited number of products or services. The resulting lack of
diversification may:
  ·
                result
      in our dependency upon the performance of a single telecommunications or
      media-related business;
 
 ·
                result
      in our dependency upon the development of a single or limited number of
      products or services; and
 
 ·
                subject
      us to economic, competitive and regulatory developments, any or all of
      which may have a substantial adverse impact upon the telecommunications
      and media industries subsequent to the consummation of a business
      combination.
  3
  In this
case, the initial business combination may not enable us to diversify our
operations or to benefit from the possible spreading of risk or offsetting of
losses, unlike other entities that may have sufficient resources to complete
several business combinations so as to diversify risk and offset losses.
Further, the prospects for our success may depend entirely upon the future
performance of the initial target business or businesses with which we effect a
business combination.
 
 Opportunity
for stockholder approval of our initial business combination
 
 Prior to
the completion of our initial business combination, we will submit the proposed
business combination to our stockholders for their approval, even if the
structure of the business combination is such that it would not ordinarily
require stockholder approval under applicable state law. In connection with
seeking stockholder approval of our initial business combination, we will
furnish our stockholders with proxy solicitation materials prepared in
accordance with the Exchange Act, which will include a description of the
operations of the target business or businesses and certain required financial
information regarding the target business or businesses.
 
 In
connection with the vote required for our initial business combination, all of
our initial stockholders, including all of our officers and directors, have
agreed to vote all of the shares of common stock owned by them immediately prior
to our initial public offering in accordance with the majority of the shares of
common stock voted by the public stockholders. The initial stockholders may cast
votes with respect to any shares of common stock acquired in our initial public
offering or in the open market in any manner as they may determine (other than
with respect to a dissolution in the event we are unable to timely complete a
business combination, which they have agreed to vote in favor of). As a result,
an initial stockholder who acquires shares in or after the initial public
offering, and is therefore a public stockholder with respect to such shares of
common stock, may vote against the proposed business combination with respect to
such shares and retains the right to exercise the conversion rights attributable
to such shares in the event that a business combination is approved. We will
proceed with a business combination only if the votes cast by our public
stockholders in favor of the business combination represent a majority of the
votes cast by our public stockholders with respect to the proposed transaction
and public stockholders owning less than 20% of the number of shares sold in our
initial public offering both exercise their conversion rights described below
and vote against the business combination.  We will structure our initial
business combination so that the transaction will proceed and may be consummated
even if the maximum number of shares that may be converted to cash in connection
with our initial business combination are in fact converted to cash, reducing
the amount of cash ultimately available to consummate the transaction by up to
approximately 20%. However, we will not proceed with our initial business
combination if public stockholders owning 20% or more of the shares sold in our
initial public offering both vote against the business combination and exercise
their conversion rights, even if public stockholders holding a majority of the
shares vote in favor of the business combination.
 
 Conversion
rights
 
 At the
time we seek stockholder approval of any business combination, we will offer
each public stockholder the right to have his or her shares of common stock
converted to cash if the stockholder votes against the business combination and
the business combination is approved and completed. Our initial stockholders
will not have such conversion rights with respect to any shares of common stock
owned by them, directly or indirectly, prior to our initial public offering;
they will have the right with respect to any shares of our common stock that
they may acquire in connection with or following our initial public offering. An
initial stockholder who acquires shares in or after the initial public offering
would be a public stockholder with respect to these shares and retains the right
to exercise conversion rights attributable to such shares. The actual per share
conversion price will be equal to the amount in the trust account (including the
amount held in the trust account representing a portion of the underwriters’
discount), which shall include $4,000,000 from the private placement of
warrants, inclusive of any interest net of taxes payable (calculated as of two
business days prior to the consummation of the proposed business combination),
divided by the number of shares sold in our initial public offering. Without
taking into any account interest earned on the trust account, the initial per
share conversion price would be approximately $7.88 or $0.12 less than the per
unit offering price of $8.00.
 
 An
eligible stockholder may request conversion 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, the business combination is approved and completed and the
stockholder continues to hold his shares through completion of the business
combination. Any request for conversion, 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 convert their shares who elect
conversion will be distributed promptly after completion of a business
combination. Public stockholders who convert their stock into their share of the
trust account still have the right to exercise any warrants that they still
hold. We will not complete any business combination if public stockholders
owning 20% or more of the shares sold in our initial public offering both
exercise their conversion rights and vote against the business
combination.
 
 Liquidation
if no business combination
 
 If we do
not consummate a business combination by April 24, 2008 (18 months after the
completion of our initial public offering), or by October 24, 2008 (24 months
after the completion of our initial public offering, if the extension criteria
described below have been satisfied), we will liquidate and distribute to all of
our public stockholders, in proportion to their respective equity interests, an
aggregate sum equal to the amount then on deposit in the trust account,
inclusive of (1) the 4% deferred underwriting discount, (2) the
proceeds from the private placement and (3) any interest earned on the
trust account (net of taxes payable), plus any remaining net assets. All of our
initial stockholders, directors and officers have agreed to waive their
respective rights to participate in any liquidation distribution occurring upon
our failure to consummate a business combination, but only with respect to those
shares of common stock beneficially owned and acquired by them prior to our
initial public offering. They will participate in any liquidation distribution
with respect to any shares of common stock acquired in connection with or
following our initial public offering. There will be no distribution from the
trust account with respect to the warrants, and all rights with respect to the
warrants will effectively terminate upon our liquidation.
 
 4
 If we
were to expend all of the net proceeds of our initial public offering, other
than the proceeds deposited in the trust account, without taking into account
any interest earned on the balance held in the trust account but including the
deferred underwriting discount, the initial per share liquidation price would be
approximately $7.88, or $0.12 less than the per unit initial public offering
price of $8.00. The offering proceeds deposited in the trust account could,
however, become subject to the claims of our creditors, and the claims would
have a preference over the claims of our public stockholders in the event of a
liquidation.  In the event of liquidation, the actual per share liquidation
price may be less than approximately $7.88 plus interest (net of taxes payable),
due to claims of creditors. David C. McCourt has agreed pursuant to an agreement
with us and Deutsche Bank Securities Inc., representative of the underwriters
for our initial public offering, that, if we liquidate prior to the consummation
of a business combination, he will be personally liable to cover claims made by
prospective target businesses, vendors and service providers, but only if, and
to the extent, the claims reduce the amounts in the trust account available for
payment to our stockholders in the event of a liquidation and the claims are
made by a vendor for services rendered, or products sold, to us or by a
prospective target business. However, Mr. McCourt will not have any personal
liability as to any claimed amounts owed to a third party who executed a waiver,
or as to any claims under our indemnity of the underwriters of our initial
public offering against certain liabilities, including liabilities under the
Securities Act of 1933. These obligations of Mr. McCourt will remain in place
even if the period within which to consummate a business combination is extended
by an amendment to our amended and restated certificate of incorporation.
However, Mr. McCourt may not be able to satisfy his obligations.
 
 Prior to
completion of a business combination, we will seek waivers from all target
acquisitions, vendors and service providers to claims to amounts in the trust
account. In the event that a third party were to refuse to enter into the
waiver, our decision to engage the third party or to enter into discussions with
the target business would be based on our management’s determination that we
would be unable to obtain, on a reasonable basis, substantially similar services
or opportunities from another entity willing to enter into the
waiver.
 
 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 our initial public 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 a business combination. If we are
unable to do so by the expiration of the 24-month period from the date of
closing of our initial public offering, we will liquidate. Upon notice from us,
the trustee of the trust account will commence liquidating the investments
constituting the trust account and will turn over the proceeds to our transfer
agent for further distribution to our public stockholders. We anticipate that
our instruction to the trustee would be given promptly after the expiration of
the applicable 18-month or 24-month period.
 
 Our
public stockholders will be entitled to receive funds from the trust account
only in the event of our liquidation or if the stockholders seek to convert
their respective shares into cash upon a business combination that the
stockholder voted against and that is actually completed by us. In no other
circumstances will a stockholder have any right or interest of any kind to or in
the trust account.
 
 Government
Regulation of the Telecommunications and Media Industries
 
 Certain
segments of the telecommunications and media industries historically have been
subject to substantial government regulation, both in the United States and
overseas. If we complete a business combination with a target business or
businesses in these industries, changes in regulatory requirements in the United
States or other countries could affect the sales of our products, limit the
growth of the markets we serve, or require costly alterations of current or
future products. Future changes in tariffs by regulatory agencies or application
of tariff requirements to currently untariffed services could affect the sales
of our products for certain classes of customers.
 
 On the
other hand, few laws or regulations currently apply directly to access of or
commerce on the Internet. New regulations governing the Internet and Internet
commerce, if adopted, could have an adverse effect on our business, operating
results, and financial condition following a business combination. New
regulations governing the Internet and Internet commerce could include matters
such as changes in encryption requirements, sales taxes on Internet product
sales, and access charges for Internet service and/or content and/or commerce
providers
 
 Competition
 
 In
identifying, evaluating and pursuing target businesses, we may encounter intense
competition from other entities having a business objective similar to ours,
including leveraged buyout and other private equity funds, operating businesses
and other entities and individuals, both foreign and domestic, competing for
business combinations in the telecommunications and media industries. Many of
these entities are well established and have extensive experience identifying
and effecting business combinations directly or through affiliates. Many of
these competitors possess greater financial, marketing, technical, human and
other resources than we do. Our ability to compete in effecting a business
combination with an appropriately sized target business or businesses will be
limited by our available financial resources.
 
 5
 This
inherent competitive limitation gives others an advantage in pursuing a business
combination with target businesses. Further:
  ·
                our
      obligation to seek stockholder approval of our initial business
      combination may impede or delay the completion of a
      transaction;
  ·
                our
      obligation to convert shares of common stock held by our stockholders into
      cash in certain instances may reduce the resources available to effect our
      initial business combination;
  ·
                our
      inability to effect a business combination with a target business that
      does not have or will not reconcile its audited financial statements in
      conformity with U.S. generally accepted accounting principles may limit
      the prospective target businesses we may pursue;
  and
  ·
                our
      outstanding warrants and the future dilution they potentially represent,
      may not be viewed favorably by target
  businesses.
  Any of
these factors may place us at a competitive disadvantage in successfully
negotiating our initial business combination, particularly against a competitor
that does not need stockholder approval to complete a business
combination.
 
 If we
succeed in effecting a business combination, there will in all likelihood be
intense competition from competitors of the target business or businesses. The
telecommunications and media industries are rapidly evolving and intensely
competitive. We expect competition to intensify in the future. Many of the
competitors we will face upon consummation of a business combination will have
significantly greater financial, technical, manufacturing, marketing and other
resources than we do. Competing with these companies after a business
combination will require investment by us in engineering, research and
development and marketing. We may not have the resources to make these
investments and may not be successful in making these investments. In addition,
the management of our competitors may have greater operating resources and
experience in their respective industries. Some of these competitors may also
offer a wider range of services than we can and may have greater name
recognition and a larger client base. For example, cable network operators and
communications operators are increasingly offering similar products in an effort
to become an all-in-one provider of voice, high speed internet access and video
services to customers. These competitors may be able to respond more quickly and
effectively to new or changing opportunities, technologies and client
requirements. They may also be able to undertake more extensive promotional
activities, offer more attractive terms to clients, and adopt more aggressive
pricing policies. If we are unable to compete effectively following a business
combination, our business, financial condition, results of operations and
prospects could be materially adversely affected.
 
 Facilities
 
 We do not
own any real estate or other physical properties. Our headquarters are located
at 179 Stony Brook Road, Hopewell, NJ 08525. Under an office administration
agreement between Granahan McCourt Capital, LLC, a private investment firm of
which David C. McCourt is the President and CEO, and us, Granahan McCourt
Capital, LLC furnishes us with office facilities, equipment and clerical
services at the facilities in exchange for a payment of $10,000 per month. We
believe, based on our management’s experience, that our office facilities are
suitable and adequate for our business as it is presently
conducted.
 
 Employees
 
 We
currently have four officers, one of whom is also a member of our board of
directors. 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. We do not intend to have any full-time employees prior
to the consummation of a business combination.
 
 Available
Information
 
 We file
with or submit to the SEC annual, quarterly and current periodic reports, proxy
statements and other information meeting the informational requirements of the
Exchange Act. While we do not have a website with available filings, we will
provide, at no additional charge, copies of these reports, proxy and information
statements and other information upon request to our address at 179 Stony Brook
Road, Hopewell, NJ 08525, Attention: Barak Bar-Cohen or by telephone to
(609) 333-1200. You may also inspect and copy these reports, proxy
statements and other information, and related exhibits and schedules, at the
Public Reference Room of the SEC at 100 F Street, NE, Washington,
D.C. 20549. You may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0330. In addition, the SEC
maintains an Internet site that contains reports, proxy and information
statements and other information filed electronically by us with the SEC which
are available on the SEC’s Internet site at http://www.sec.gov.
 
 6
 We will
not acquire a target business if we cannot obtain audited financial statements
based on United States generally accepted accounting principles for such target
business. We will provide these financial statements in the proxy solicitation
materials sent to stockholders for the purpose of seeking stockholder approval
of our initial business combination. Our management believes that the need for
target businesses to have, or be able to obtain, audited financial statements
may limit the pool of potential target businesses available for
acquisition.
 
 We are
required to comply with the internal control requirements of the Sarbanes-Oxley
Act. A target company may not be in compliance with the provisions of the
Sarbanes-Oxley Act regarding adequacy of their internal controls. The
development of the internal controls of any such entity to achieve compliance
with the Sarbanes-Oxley Act may increase the time and costs necessary to
complete any such acquisition.
  ITEM1A.   
RISK FACTORS
 
 An
investment in our securities involves a high degree of risk. You should consider
carefully all of the risks described below, together with the other information
contained in this report, before making a decision to invest in our securities.
If any of the following risks occur, our business, financial condition and
results of operations may be adversely affected.
 
  Risks
Related to 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 an operating history, you will have no basis upon which to evaluate our
ability to achieve our business objective, which is to effect a business
combination. We will not generate any revenues until, at the earliest, after the
consummation of a business combination.
 
 If
we are forced to dissolve and liquidate before a business combination and
distribute the trust account, our public stockholders may receive less than
$8.00 per share and our warrants will expire worthless.
 
 We must
complete a business combination with a fair market value of at least 80% of our
net assets (excluding the amount held in the trust account representing a
portion of the underwriters’ discount) at the time of acquisition by April 24,
2008 (18 months after the consummation of our initial public offering) or
by October 24, 2008 (within 24 months from the consummation of our initial
public offering if a letter of intent, agreement in principle or definitive
agreement has been executed within 18 months after the consummation of our
initial public offering). If we are unable to complete a business combination
within the prescribed time frame and are forced to dissolve and liquidate our
assets, the per share liquidation distribution may be less than $8.00 because of
the expenses paid in our initial public offering. Furthermore, there will be no
distribution from the trust account with respect to our outstanding warrants
which will expire worthless if we dissolve and liquidate before the completion
of a business combination.
 
 If
we do not consummate a business combination and are forced to dissolve, payments
from the trust account to our public stockholders may be delayed.
 
 We
currently believe that any plan of dissolution and distribution subsequent to
the expiration of the 18 and 24-month deadlines would proceed in approximately
the following manner:
  ·
                our
      board of directors will, consistent with its obligations described in our
      fourth 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 it will then vote to recommend to
      our stockholders; at such time it will also cause to be prepared a
      preliminary proxy statement setting out the plan of dissolution and
      distribution as well as the board’s recommendation of the
      plan;
 
 ·
                promptly
      after the passing of such deadline, we would file our preliminary proxy
      statement with the Securities and Exchange
  Commission;
 
 ·
                if
      the Securities and Exchange Commission does not review the preliminary
      proxy statement, then, ten 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 Securities and Exchange Commission does review the preliminary proxy
      statement, we currently estimate that we will receive such comments within
      approximately 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 which may be substantial) and we will convene a meeting
      of our stockholders at which they will either approve or reject our plan
      of dissolution and distribution.
  7
 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 fourth
amended and restated certificate of incorporation, our powers following the
expiration of the permitted time periods for consummating a business combination
will automatically 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
approval is obtained from our stockholders, the funds held in our trust account
will not be released.
 
 These
procedures, 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.
 
 Upon
distribution of the trust account, our stockholders may be held liable for
claims of third parties against us to the extent of distributions received by
them.
 
 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 a corporation complies with certain statutory
procedures set forth in Section 280 of the Delaware General Corporation Law
intended to ensure that the corporation makes reasonable provision for all
claims against it, 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 from claims brought after the third anniversary of
the dissolution. The procedures in Section 280 include a 60-day notice
period during which any third-party claims may be brought against us, a 90-day
period during which we may reject any claims brought, and an additional 150-day
waiting period before any liquidating distributions may be made to stockholders.
We do not intend to follow the procedures in Section 280 of the Delaware
General Corporation Law, and therefore, our stockholders could potentially be
liable for any claims to the extent of distributions received by them in a
dissolution and any liability of our holders of common stock sold in our initial
public offering may extend beyond the third anniversary of such
dissolution.
 
 If
the net proceeds from the initial public offering that were not placed in the
trust account are insufficient to allow us to operate until October, 2008, we
may not be able to complete a business combination.
 
 We
currently believe that the funds available to us from the net proceeds from
our initial public offering not placed in the trust account together with funds
borrowed from David C. McCourt on March 14, 2008, are sufficient to allow us to
operate until October, 2008, and any potential business combination will have to
include additional financing. However, we cannot assure you that our estimates
will be accurate. We could use a portion of these funds to pay due diligence
costs in connection with a potential business combination or to pay fees to
consultants to assist us with our search for a target acquisition. We could also
use a portion of these funds as a down payment or to fund a “no-shop” provision
(a provision in letters of intent designed to keep target acquisitions from
“shopping” around for transactions with others on terms more favorable to such
target acquisitions) with respect to a particular proposed business combination,
although we do not have any current intention to do so. If we entered into such
a letter of intent where we paid for the right to receive exclusivity from a
target acquisition and were subsequently required to forfeit such funds (whether
as a result of our breach or otherwise), we might not have sufficient funds to
continue searching for, or conduct due diligence with respect to any other
potential target acquisitions.
 
 You
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 an unidentified target acquisition, we may be 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 SEC promptly following the consummation
of our offering including an audited balance sheet demonstrating this fact, we
are exempt from rules promulgated by the SEC to protect investors of blank check
companies such as Rule 419. Accordingly, investors are not afforded the
benefits or protections of those rules. Because we are not subject to these
rules, including Rule 419, our units were immediately tradable and we have
a longer period of time to complete a business combination in certain
circumstances than we would if we were subject to such rule.
 
 If
third parties bring claims against us, the proceeds held in the trust account
could be reduced and the per share liquidation price received by stockholders
will be less than the approximately $7.88 per share held in trust.
 
 Our
placing of funds in the trust account may not protect those funds from third
party claims against us. Upon our dissolution, we will be required, pursuant to
Delaware General Corporate Law Sections 280 and 281, to pay or make reasonable
provision to pay all of our claims and obligations, including contingent or
conditional claims, which we intend to pay, to the extent sufficient to do so,
from our funds not held in the trust account. Although we will seek to have all
vendors, prospective target businesses or other entities with which we execute
agreements waive 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. 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.
 
 8
 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 enter into an agreement with a third
party that did not execute a waiver only 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 not seek recourse against
the trust account for any reason. In addition, creditors may seek to interfere
with the distribution process under state or federal creditor and bankruptcy
laws. Accordingly, the proceeds held in the trust account could be subject to
claims which could take priority over those of our public stockholders. We
cannot assure you that the per share distribution from the trust account will
not be less than approximately $7.88 (of which $0.32 per share is attributable
to the underwriters’ deferred discount), plus net interest accrued, due to such
claims, or that there will not be delays in distributing funds in addition to
those imposed by our duties to comply with Delaware General Corporation Law
procedures and federal securities laws and regulations. Mr. McCourt has
agreed that he will be personally liable to cover claims made by such third
parties, but only if, and to the extent, the claims reduce the amounts in the
trust account available for payment to our stockholders in the event of a
liquidation and the claims are made by a vendor for services rendered, or
products sold, to us or by a prospective target business. However,
Mr. McCourt will not have any personal liability as to any claimed amounts
owed to a third party who executed a waiver, or as to any claims under our
indemnity of the underwriters of our initial public offering against certain
liabilities, including liabilities under the Securities Act of 1933. However, we
cannot assure you that Mr. McCourt will be able to satisfy those
obligations.
 
 Under
Delaware law, the requirements and restrictions relating to our initial public
offering contained in our fourth amended and restated certificate of
incorporation may be amended, which could reduce or eliminate the protection
afforded to our stockholders by such requirements and restrictions.
 
 Our
fourth amended and restated certificate of incorporation contains certain
requirements and restrictions relating to our initial public offering that will
apply to us until the consummation of a business combination. Specifically, our
fourth amended and restated certificate of incorporation provides among other
things, that:
  ·
                approximately
      $88,650,000 of the proceeds from our initial public offering, as well as
      the underwriters’ deferred discount and the proceeds of the private
      placement, were deposited into the trust account, which proceeds may not
      be disbursed from the trust account until the earlier of (i) a
      business combination or (ii) our liquidation, or as otherwise
      permitted in our fourth amended and restated certificate of
      incorporation;
 
 ·
                prior
      to consummating our initial business combination, we must submit such
      business combination to our stockholders for
  approval;
 
 ·
                we
      may consummate our initial business combination if it is approved by
      public stockholders holding a majority of the shares of our common stock
      sold in our initial public offering and voted by our public stockholders
      and if public stockholders owning less than 20% of the shares sold in our
      initial public offering both vote against the business combination and
      exercise their conversion rights;
 
 ·
                if
      our initial business combination is approved and consummated, public
      stockholders who voted against the business combination and who exercised
      their own conversion rights will receive their pro rata share of the trust
      account (including the underwriters’ deferred
  discount);
 
 ·
                if
      a business combination is not consummated or a letter of intent, an
      agreement in principle, or a definitive agreement is not signed within the
      time periods specified in this prospectus, then we will be dissolved and
      distribute to all of our public stockholders their pro rata share of the
      trust account; and
 
 ·
                we
      may not consummate any other merger, capital stock exchange, stock
      purchase, asset acquisition or similar transaction other than a business
      combination that meets the conditions specified in this prospectus,
      including the requirement that the business combination be with one or
      more operating businesses whose fair market value, collectively, is at
      least equal to 80% of our net assets (excluding the underwriters’ deferred
      discount) at the time of such business
  combination.
  Our
fourth amended and restated certificate of incorporation requires that we obtain
the unanimous consent of stockholders to amend the above provisions. However,
the validity of unanimous consent provisions under Delaware law has not been
settled. A court could conclude that the unanimous consent requirement
constitutes a practical prohibition on amendment in violation of the
stockholders’ implicit rights to amend the company’s fourth amended and restated
certificate of incorporation. In that case, some or all of the above provisions
could be amended without unanimous consent and any such amendment could reduce
or eliminate the protection afforded to our stockholders. However, we view the
foregoing provisions as obligations to our stockholders and we will not take any
action to waive or amend any of these provisions that would take effect prior to
the consummation of a business combination.
 
 Since
we have not yet selected any target acquisition with which to complete a
business combination, we are unable to currently ascertain the merits or risks
of the business’ operations.
 
 Because
we have not yet selected a prospective target acquisition, investors currently
have no basis to evaluate the possible merits or risks of the target
acquisition. We cannot assure you that our management, when evaluating a
prospective target acquisition, will properly ascertain or assess all of the
significant risk factors. We also cannot assure you that an investment in our
securities will ultimately prove to be more favorable to investors than a direct
investment, if such opportunity were available, in a target acquisition. Except
for the limitation that a target acquisition may have a fair market value of at
least 80% of our net assets (excluding the amount held in the trust account
representing a portion of the underwriters’ discount) at the time of the
acquisition, we will have virtually unrestricted flexibility in identifying and
selecting a prospective acquisition candidate.
 
 9
 There
may be tax consequences associated with our acquisition, holding and disposition
of target companies and assets.
 
 We may
incur significant taxes in connection with effecting acquisitions; holding,
receiving payments from, and operating target companies and assets; and
disposing of target companies and assets.
 
 We
may issue shares of our capital stock to complete a business combination, which
would reduce the equity interest of our stockholders and could potentially cause
a change in control of our ownership.
 
 Our
fourth amended and restated certificate of incorporation authorizes the issuance
of up to 100,000,000 shares of common stock, par value $0.0001 per share, and
5,000 shares of preferred stock, par value $0.0001 per share. There are
70,687,500 authorized but unissued shares of our common stock available for
issuance (including appropriate reservation for the issuance of shares upon full
exercise of our outstanding warrants) and 5,000 shares of preferred stock
available for issuance. Although we have no commitment to do so, we are likely
to issue a substantial number of additional shares of our common or preferred
stock, or a combination of common and preferred stock, to complete a business
combination. The issuance of additional shares of our common stock or any number
of shares of our preferred stock:
  ·
                may
      significantly reduce the equity interest of
  investors;
 
 ·
                may
      subordinate the rights of holders of common stock if preferred stock is
      issued with rights senior to those afforded to our common
      stock;
 
 ·
                could
      potentially cause a change in control if a substantial number of our
      shares of common stock are issued, which may affect, among other things,
      our ability to use our net operating loss carry forwards, if any, and
      could result in the resignation or removal of our present officers and
      directors; and
 
 ·
                may
      adversely affect prevailing market prices for our common
      stock.
  We
may issue debt securities, which could limit our ability to operate our business
and return value to our stockholders.
 
 If we
issue debt securities, 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;
 
 ·
                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;
 
 ·
                our
      inability to pay dividends on our common
stock;
 
 ·
                using
      a substantial portion of our cash flow to pay principal and interest on
      our debt, which will reduce the funds available for dividends on our
      common stock, working capital, capital expenditures, acquisitions and
      other general corporate purposes;
 
 ·
                limitations
      on our flexibility in planning for and reacting to changes in our business
      and in the industry in which we
operate;
 
 ·
                increased
      vulnerability to adverse changes in general economic, industry and
      competitive conditions and adverse changes in government
      regulation;
 
 ·
                limitations
      on our ability to borrow additional amounts for working capital, capital
      expenditures, acquisitions, debt service requirements, execution of our
      strategy and other purposes; and
 
 ·
                other
      disadvantages compared to our competitors who have less
    debt.
  10
 Our
ability to successfully consummate a business combination and to be successful
thereafter will be dependent upon the efforts of our management.
 
 Our
ability to successfully consummate a business combination will be dependent upon
the efforts of our current key personnel. The future role of our current key
personnel following a business combination, however, cannot presently be fully
ascertained. None of our current key personnel have entered into either
employment or consulting agreements with us and they may only remain with the
combined company upon the consummation of a business combination if they are
able to negotiate and agree to mutually acceptable employment or consultancy
terms, which terms would be determined at such time by the respective parties
and disclosed to stockholders at the time we seek approval for the initial
business combination. Furthermore, we will not be able to grant shares of common
stock or options to our current key personnel prior to the earlier of the
completion of a business combination or the total release of funds in the trust
account, which may affect our hiring and retention efforts. Even if our current
key personnel remain with us following a business combination, there is no
assurance that the business combination will be successful. For example,
Mr. McCourt was the Chief Executive Officer and Chairman of RCN Corporation
in May 2004 when it went through a voluntary reorganization under
Chapter 11 of the U.S. Bankruptcy Code. Additionally, we may also employ
other personnel following a business combination, including the management
associated with the acquisition candidate.
 
 Our
officers and directors will allocate some portion of 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 could create a conflict of interest when allocating their time
between our operations and their other commitments. We do not intend to have any
full time employees prior to the consummation of a business combination. All of
our officers and directors are not obligated to devote any specific number of
hours to our affairs. If an officer or director is required to devote more
substantial amounts of time to his or her other businesses and affairs, it could
limit his or her ability to devote time to our affairs and could have a negative
impact on our ability to consummate a business combination. We cannot assure you
that these conflicts will be resolved in our favor.
 
 Our
officers and directors currently are, and may in the future become affiliated
with additional entities that are, engaged in business activities similar to
those intended to be conducted by us and, accordingly, may have conflicts of
interest in determining to which entity a particular business opportunity should
be presented.
 
 Some of
our officers and directors are affiliated with entities in the
telecommunications and media industry. David C. McCourt, our President,
Chief Executive Officer and Chairman, is the Chairman and interim Chief
Executive Officer and Chief Operating Officer of Narrowstep, Inc., a company
that provides television services over the Internet and Roger L. Werner,
Jr., one of our directors, is Chairman of Werner Telesport, LLC, a sports
programming production company, and serves as a director of Narrowstep, Inc. and
WATV Productions, a vehicle enthusiasts production company. In addition Paul N.
D’Addario, a director, is the founder and Senior Managing Director of Palisades
Ventures, a technology and media growth fund.
 
 Several
of our officers are also officers of Granahan McCourt Capital, LLC, a private
investment firm founded by Mr. McCourt focused on making minority
investments in, and advising, companies in the telecommunications and media
industries. Mr. McCourt is Chairman and Chief Executive Officer,
Mr. Bar-Cohen is President and Chief Operating Officer, and Ms. Ito is
Chief Administrative Officer. To the extent a business presents mutually
exclusive opportunities including both the possibility of being acquired by us
and the possibility of a minority investment by or an advising contract with
Granahan McCourt Capital, LLC our officers could face conflicts of interest in
determining to which entity a particular business opportunity should be
presented.
 
 One of
our directors, Barry S. Sternlicht, is currently the Chairman and Chief
Executive Officer of Third Wave Acquisition Corp, a blank check company, which
is in registration with the SEC.  However all of our officers and
directors currently are, and may in the future become affiliated with additional
entities, including other “blank check” companies. Additionally, our officers
and directors may become aware of business opportunities that may be appropriate
for presentation to us and the other entities to which they owe fiduciary
duties. Accordingly, our officers and directors may have conflicts of interest
in determining to which entity a particular business opportunity should be
presented. We cannot assure you that any of these conflicts will be resolved in
our favor.
 
 If
we seek to effect a business combination with an entity that is directly or
indirectly affiliated with one or more of our officers and directors, conflicts
of interest could arise.
 
 Our
officers and directors either currently have or may in the future have
affiliations with companies in the telecommunications and media industries. If
we were to seek a business combination with a target business with which one or
more of our officers or directors may be affiliated, conflicts of interest could
arise in connection with negotiating the terms of and completing the business
combination. Conflicts that may arise may not be resolved in our favor. In the
event we pursue a business combination with an entity with which one or more of
officers and directors is affiliated, we would obtain an opinion from an
independent investment banking firm regarding the fairness to our stockholders
from a financial point of view of the business combination. Our officers and
directors are not currently aware of any specific opportunities to consummate a
business combination with any entities with which they are affiliated, whether
by virtue of the sale of assets, spin-off, divestiture or otherwise, and there
have been no preliminary discussions or indications of interest with any such
entity or entities. Although we will not be specifically focusing on or
targeting any transaction with any entities affiliated with any of our officers
and directors, and we are unaware of any such actual or potential transaction as
of the date of this prospectus, we would consider such a transaction after the
offering if any such opportunity were presented to us. It is possible that we
could consider an opportunity with entities affiliated with any of our officers
and directors without first seeking to consummate a business combination with an
entity that is not affiliated with any of our officers and
directors.
 
 11
 Our
current officers and directors may resign upon consummation of a business
combination.
 
 Upon
consummation of a business combination, the role of our officers and directors
in the target business cannot presently be fully ascertained. We may employ
other personnel following the business combination. If we acquire a target
business in an all cash transaction, it would be more likely that our management
team and certain of our directors would remain with us if they chose to do so.
If a business combination were structured as a merger whereby the stockholders
of the target company were to control the combined company, following a business
combination, it may be less likely that our management team would remain with
the combined company unless it was negotiated as part of the transaction via the
acquisition agreement, an employment agreement or other arrangement. If, as a
condition to a potential business combination, our management team negotiates to
be retained after the consummation of the business combination, such
negotiations may result in a conflict of interest. In making the determination
as to whether current management should remain with us following the business
combination, we will analyze the experience and skill set of the target
business’ management and negotiate, as part of the business combination, that
certain of our management team and directors remain if it is believed that it is
in the best interests of the combined company after the consummation of the
business combination.
 
 The
2,812,500 shares of common stock owned by our officers and directors will
not participate in liquidation distributions, and a conflict of interest may
arise in determining whether a particular target acquisition is appropriate for
a business combination.
 
 Our
officers and directors own, in the aggregate, 2,812,500 shares of our common
stock and the 4,000,000 warrants purchased in the private placement, but
have waived their right to receive distributions (other than with respect to any
units they purchase in our initial public offering or units, warrants or common
stock they purchase in the aftermarket) upon our dissolution and liquidation
prior to a business combination. Such shares and warrants owned by our officers
and directors will be worthless if we do not consummate a business combination.
The personal and financial interests of our officers and directors may influence
their motivation in identifying and selecting a target business and completing a
business combination in a timely manner. Consequently, our officers’ and
directors’ 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 public stockholders’ best interest.
 
 There
is no guarantee that a market for our securities will be maintained, which would
adversely affect the liquidity and price of our securities.
 
 Investors
have access to information from only a relatively short period of our prior
market history.  The price of our securities may vary significantly due to
reports of operating losses, one or more potential business combinations, the
filing of periodic reports with the SEC and general market or economic
conditions. Furthermore, an active trading market for our securities may not be
sustained. You may be unable to sell your securities unless a market can be
sustained.
 
 If
our common stock becomes subject to the SEC’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
will 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 the transaction prior to
      sale;
 
 ·
                provide
      the purchaser with risk disclosure documents which identify certain risks
      associated with investing in “penny stocks” and which 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.
 
 Initially,
we may only be able to complete one business combination, which may 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 provided us with approximately
$81,050,000, which, along with $4,000,000 of the proceeds from the private
placement and the $3,600,000 underwriters’ deferred discount (an aggregate of
$88,650,000), is held in the trust account and may be used by us to complete a
business combination. Our business combination must be with a business having a
fair market value of at least 80% of our net assets (excluding the amount held
in the trust account representing a portion of the underwriters’ discount) at
the time of such business combination. We have no limitation on our ability to
raise additional funds through the private sale of securities or the incurrence
of indebtedness that would enable us to effect a business combination with an
operating business having a fair market value in excess of 80% of our net assets
(excluding the amount held in the trust account representing a portion of the
underwriters’ discount) at the time of such a business combination.
Consequently, initially it is probable that we will have the ability to complete
only a single business combination. We may not be able to acquire more than one
target business because of various factors, including insufficient financing or
the difficulties involved in consummating the contemporaneous acquisition of
more than one operating company. Therefore, it is probable that we will have the
ability to complete a business combination with only a single operating
business, which may have only a limited number of products or services. The
resulting lack of diversification may:
 
 12
 
  ·
                  result
      in our dependency upon the performance of a single or small number of
      operating businesses;
  ·
                  result
      in our dependency upon the development or market acceptance of a single or
      limited number of products, processes or services;
  and
 
 ·
                  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.
 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 that
may have the resources to complete several business combinations in different
industries or different areas of a single industry so as to diversify risks and
offset losses. Further, the prospects for our success may be entirely dependent
upon the future performance of the initial target business or businesses we
acquire.
 
 The
ability of our stockholders to exercise their conversion rights may not allow us
to effectuate the most desirable business combination or optimize our capital
structure.
 
 When we
seek stockholder approval of any business combination, we will offer each public
stockholder (but not our initial stockholders with respect to any shares they
owned prior to our initial public offering) the right to have his, her or its
shares of common stock converted to cash if the stockholder votes against the
business combination and the business combination is approved and completed. An
initial stockholder who acquires shares in the offering or thereafter in the
open market, however, would be a public stockholder with respect to such shares
and retains the right to exercise the conversion rights attributable to such
shares. Such holder must both vote against such business combination and then
exercise his, her or its conversion rights to receive a pro rata share of the
trust account. 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 conversion rights, we may either
need to reserve part of the trust account for possible payment upon such
conversion, or we may need to arrange third party financing to help fund our
business combination in case a larger percentage of stockholders exercise their
conversion rights than we expect. 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 to incur an
amount of leverage that is not optimal for our business combination. This may
limit our ability to effectuate the most attractive business combination
available to us.
 
 Because
of our limited resources and the significant competition for business
combination opportunities, we may not be able to consummate a business
combination during the prescribed time period.
 
 We expect
to encounter intense competition from other entities having a business objective
similar to ours, including private investors (which may be individuals or
investment partnerships), other blank check companies, and operating businesses
competing for the types of businesses that we intend to primarily focus on. Many
of these individuals and entities are well established and have extensive
experience in identifying and effecting, directly or indirectly, acquisitions of
companies in the telecommunications and media industries. Many of these
competitors possess greater technical, human and other resources, or more local
industry knowledge, than we do and our financial resources will be relatively
limited when contrasted with those of many of these competitors. Accordingly,
our ability to compete with respect to the acquisition of certain target
acquisitions that are sizable will be limited by our available financial
resources. This inherent competitive limitation gives others an advantage in
pursuing the acquisition of certain target acquisitions. Furthermore, the
obligation we have to seek stockholder approval of a business combination may
delay the consummation of a transaction. Additionally, the warrants underlying
units issued in connection with our initial public offering and the warrants
issued in connection with the private placement and their dilutive effect they
may not be viewed favorably by certain target acquisitions. Also, our obligation
to convert into cash the shares of common stock in certain instances may reduce
the resources available for a business combination. Any of these obligations may
place us at a competitive disadvantage in successfully negotiating a business
combination.
 
 We
may have insufficient resources to cover our operating expenses and the expenses
of consummating a business combination.
 
 As of
December 31, 2007, we had approximately $306,180 remaining from the proceeds of
our initial public offering outside the trust account and on March 14, 2008 we
borrowed $250,000 from David C. McCourt. These funds are available to cover our
operating expenses until October, 2008, including expenses incurred in
connection with a business combination, based upon our management’s estimate of
the amount required for these purposes. This estimate may prove inaccurate,
especially if a portion of the available proceeds is used to make a down payment
or pay exclusivity or similar fees in connection with a business combination or
if we expend a significant portion of the available proceeds in pursuit of a
business combination that is not consummated.
 
 13
 
 We may
not be able to obtain additional financing, on acceptable terms, if at all, and
neither our sponsor, Mr. McCourt, nor other members of our management team
is obligated to provide any additional financing. If we do not have sufficient
proceeds and are unable to obtain additional financing, we may be forced to
liquidate prior to consummating a business combination.  In addition,
if we consummate a business combination, 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.
 
 Our
initial stockholders, including our officers and directors, control a
substantial interest in us and thus may influence certain actions requiring a
stockholder vote.
 
 David C.
McCourt and our other officers and directors collectively, own 20% of our issued
and outstanding shares of common stock. In addition, there is no restriction on
the ability of our initial stockholders to purchase units or shares of our
common stock either in our initial public offering or in the open market after
completion of the offering. If they were to do so, the percentage of our
outstanding common stock held by our initial stockholders would increase. Our
board of directors will be divided into three classes, each of which generally
will serve for a term of three years, with only one class of directors being
elected in each year. There may not 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 this “staggered” board of directors, only a minority of the
board of directors would be considered for election. As a result, our officers
and directors may exert considerable influence on actions requiring a
stockholder vote, including the election of officers and directors, amendments
to our fourth amended and restated certificate of incorporation, the approval of
benefit plans, mergers, and similar transactions. Moreover, except to the extent
stockholder proposals are properly and timely submitted, our directors will
determine which matters, including prospective business combinations, to submit
to a stockholder vote. As a result, they will exert substantial control over
actions requiring a stockholder vote both before and following a business
combination.
 
 In
connection with the stockholder vote required for a business combination, all of
our initial stockholders, including all of our officers and directors, have
agreed to vote all of the shares of common stock owned by them immediately prior
to the offering in accordance with the majority of the shares of common stock
voted by the public stockholders.
 
 In
addition, our initial stockholders have agreed to vote all of the shares owned
by them in favor of our dissolution in the event we are unable to timely
complete a business combination.
 
 Our
outstanding warrants may have an adverse effect on the market price of our
common stock and make it more difficult to effect a business
combination.
 
 We have
issued and outstanding warrants to purchase up to 15,250,000 shares of common
stock.  To the extent we issue shares of common stock to effect a business
combination, the potential for the issuance of a substantial number of
additional shares upon exercise of these warrants could make us a less
attractive acquisition vehicle in the eyes of a target acquisition. Such
warrants, 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. Therefore, our outstanding warrants may make it more
difficult to effectuate a business combination or increase the cost of acquiring
the target acquisition.  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.  If and to the extent our warrants are exercised, you may
experience dilution to your holdings.
 
 The
exercise by our initial stockholders of their registration rights may have an
adverse effect on the market price of our common stock and the existence of the
registration rights may make it more difficult to effect a business
combination.
 
 Our
initial stockholders are entitled to make a demand that we file a
registration statement to register their shares of common stock held prior to
our initial public offering and the warrants sold in the private placement,
including any shares of common stock issuable upon exercise of such warrants, at
any time commencing 90 days prior to the expiration of the transfer restrictions
on such securities. If our initial stockholders exercise their registration
rights with respect to all of their shares of common stock, including those
underlying the warrants issued in the private placement, then there will be an
additional 6,812,500 shares, or an additional 60.6% of the post-offering
shares of our common stock, eligible for trading in the public market (assuming
no exercise of the underwriters’ over-allotment option and no exercise of
warrants by our public stockholders). The presence of these additional shares of
common stock trading in the public market may have an adverse effect on the
market price of our common stock. In addition, the existence of the registration
rights may make it more difficult to effectuate a business combination or
increase the cost of acquiring the target acquisition, as the stockholders of
the target acquisition may be discouraged from entering into a business
combination with us or may request a higher price for their securities because
of the potential effect the exercise of the registration rights may have on the
trading market for our common stock.
 
 14
 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 difficult for us to complete a business combination, or we may be
required to incur additional expenses if we are unable to dissolve after the
expiration of the allotted time periods.
 
 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.
  To this
end, the proceeds from our initial public offering held in the trust account may
be invested by the trust agent only in United States “government securities”
within the meaning of Section 2(a)(16) of the Investment Company Act of
1940 with a maturity 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 meet the requirements for the exemption provided in Rule 3a-1
promulgated under the Investment Company Act of 1940.
 
 In
addition, if we do not complete a business combination by April 24, 2008
(18 months after the consummation of our initial public offering) or by
October 24, 2008 (24 months from the consummation of our initial public
offering if a letter of intent, agreement in principle or definitive agreement
has been executed by April 24, 2008 and a business combination has not yet been
consummated), our fourth amended and restated certificate of incorporation
(a) provides that our corporate powers will automatically thereafter be
limited to acts and activities relating to dissolving and winding up our
affairs, including liquidation, and (b) requires that, within 15 days
after the expiration of the allotted time periods, our board of directors adopt
a resolution finding our dissolution advisable and that it provide notice as
soon as possible thereafter of a special meeting of stockholders to vote on our
dissolution. If our stockholders do not approve our dissolution in a timely
manner or at all, we will not be able to liquidate and distribute the trust
account to holders of our common stock sold in our initial public offering for
an extended period of time or indefinitely, and, consequently, we may be deemed
to be an investment company.
 
 If we are
deemed to be an investment company at any time, we will be required to comply
with additional regulatory requirements under the Investment Company Act of 1940
which would require additional expenses for which we have not
budgeted.
 
 We
may or may not obtain an opinion from an unaffiliated third party as to the fair
market value of the target acquisition or that the price we are paying for the
business is fair to our stockholders.
 
 We are
not required to obtain an opinion from an unaffiliated third party that either
the target acquisition we select has a fair market value in excess of 80% of our
net assets (excluding the amount held in the trust account representing a
portion of the underwriters’ discount) or that the price we are paying is fair
to stockholders. If no opinion is obtained, our stockholders will be relying on
the judgment or our board of directors.
 
 The
American Stock Exchange may require us to submit a new listing application,
subject to the initial listing requirements, in connection with a business
combination, or may delist our securities from trading on its exchange, which
could limit investors’ ability to effect transactions in our securities and
subject us to additional trading restrictions.
 
 Our
securities are listed on the American Stock Exchange, a national securities
exchange. We cannot assure you that our securities will continue to be listed on
the American Stock Exchange in the future. In addition, in connection with a
business combination, it is likely that the American Stock Exchange may require
us to file a new listing application and meet its initial listing
requirements, as opposed to its more lenient continued listing requirements. We
cannot assure you that we will be able to meet those initial listing
requirements at that time.
 
 If the
American Stock Exchange delists our securities from trading on its exchange in
the future, we could face significant material adverse consequences,
including:
  ·
                a
      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
  us;
 
 ·
                decreased
      ability to issue additional securities or obtain additional financing in
      the future; and
 
 ·
                decreased
      ability of our security holders to sell their securities in certain
      states.
  15
 If
we are unable to maintain a current prospectus relating to the common stock
underlying our warrants, our warrants may have no value and the market for our
warrants may be limited.
 
 Our
warrants are not exercisable unless, at the time of exercise, a post-effective
amendment to the initial public offering registration statement, or a new
registration statement, is effective which includes a current prospectus
relating to the common stock issuable upon exercise of the warrants and the
common stock underlying the warrants has been registered or qualified or deemed
to be exempt under the securities laws of the state of residence of the holders
of our warrants. Under the terms of the warrant agreement between Continental
Stock Transfer & Trust Company, as warrant agent, and us, we have
agreed to use our best efforts to maintain a current prospectus relating to the
common stock issuable upon exercise of our warrants until the expiration of our
warrants. However, we cannot assure you that we will be able to do so. In
addition, the warrant agreement provides that we are not required to net-cash
settle the warrants if we are unable to maintain a current prospectus. If the
prospectus relating to the common stock issuable upon exercise of the warrants
is not current or if the common stock is not qualified or exempt from
qualification in the jurisdictions in which the holders of the warrants reside,
our warrants may not be exercisable before they expire. Thus, our warrants may
be deprived of any value and the market for our warrants may be limited. Even if
warrant holders are not able to exercise their warrants because there is no
current prospectus or the common stock is not qualified or exempt from
qualification in the jurisdictions in which the holders of the warrants reside,
we can exercise our redemption rights.
 
 We
may choose to redeem our outstanding warrants at a time that is disadvantageous
to our warrant holders.
 
 We may
redeem the warrants issued as a part of our units (including the warrants sold
in the private placement) at any time after the warrants become exercisable in
whole and not in part, at a price of $0.01 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 $11.50 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 it may be disadvantageous for the holders 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.
 
 Provisions
in our charter documents and Delaware law may inhibit a takeover of us, which
could limit the price investors might be willing to pay in the future for our
common stock and could entrench management.
 
 Our
fourth amended and restated certificate of incorporation and bylaws contain
provisions that may discourage unsolicited takeover proposals that stockholders
may consider to be in their best interests. These provisions include a staggered
board of directors and the ability of the board of directors to designate the
terms of and issue new series of preferred stock. Our board of directors is
divided into three classes, each of which will generally serve for a term of
three years with only one class of directors being elected in each year. As a
result, at any annual meeting only a minority of the board of directors will be
considered for election. Since our “staggered board” would prevent our
stockholders from replacing a majority of our board of directors at any annual
meeting, it may entrench management and discourage unsolicited stockholder
proposals that may be in the best interests of stockholders.
 
 We are
also subject to anti-takeover provisions under Delaware law, which could delay
or prevent a change of control. Together these provisions may make more
difficult the removal of management and may discourage transactions that
otherwise could involve payment of a premium over prevailing market prices for
our securities.
  Risks
Related to Doing Business Outside the United States
 
 Since
we may acquire a target business that is located outside the United States, we
may encounter risks specific to one or more countries in which we ultimately
operate.
 
 We may
acquire a business or businesses with some relationship to countries outside of
the United States. If we acquire a company that has operations outside the
United States, we will be exposed to risks that could negatively impact our
future results of operations following a business combination. The additional
risks we may be exposed to in these cases include but are not limited
to:
  ·
                tariffs
      and trade barriers;
 
 ·
                regulations
      related to customs and import/export
matters;
 
 ·
                tax
      issues, such as tax law changes and variations in tax laws as compared to
      the United States;
 
 ·
                cultural
      and language differences;
 
 ·
                foreign
      exchange controls;
 
 ·
                the
      possibility of our assets being
nationalized;
 
 ·
                crime,
      strikes, riots, civil disturbances, terrorist attacks and wars;
      and
 
 ·
                deterioration
      of political relations with the United
States.
  16
 Foreign
currency fluctuations could adversely affect our business and financial
results.
 
 A target
business with which we combine may do business and generate sales within other
countries. Foreign currency fluctuations may affect the costs that we incur in
such international operations. It is also possible that some or all of our
operating expenses may be incurred in non-U.S. dollar currencies. The
appreciation of non-U.S. dollar currencies in those countries where we have
operations against the U.S. dollar would increase our costs and could harm our
results of operations and financial condition.
 
 Because
we must furnish our stockholders with target business financial statements
prepared in accordance with and reconciled to U.S. generally accepted accounting
principles, we will not be able to complete a business combination with some
prospective target businesses unless their financial statements are first
reconciled to U.S. generally accepted accounting principles.
 
 The
federal securities laws require that a business combination meeting certain
financial significance tests include historical and/or pro forma financial
statement disclosure in periodic reports and proxy materials submitted to
stockholders. Because our initial business combination must be with a target
business that has a fair market value equal to at least 80% of our net assets at
the time of such business combination (all of our assets, including the funds
held in the trust account other than the deferred underwriting discount, less
our liabilities), we will be required to provide historical and/or pro forma
financial information to our stockholders when seeking approval of a business
combination with one or more target businesses. These financial statements must
be prepared in accordance with, or be reconciled to, U.S. generally accepted
accounting principles and the historical financial statements must be audited in
accordance with the standards of the Public Company Accounting Oversight Board
(United States), or PCAOB. If a proposed target business, including one located
outside of the United States, does not have financial statements that have been
prepared in accordance with, or that can be reconciled to, U.S. generally
accepted accounting principles and audited in accordance with the standards of
the PCAOB, we will not be able to acquire that proposed target business. These
financial statement requirements may limit the pool of potential target
businesses with which we may combine.
 
 Risks
Associated with the Telecommunications and Media Industries
 
 We
may be subject to significant regulatory requirements in connection with our
efforts to consummate a business combination with a company in the
telecommunications and media industries, which may result in our failure to
consummate our initial business combination within the required time frame and
may force us to liquidate.
 
 Acquisitions
of telecommunications and media companies are often subject to significant
regulatory requirements and consents, and we will not be able to consummate a
business combination with certain types of telecommunications and media
companies without complying with applicable laws and regulations and obtaining
required governmental or client consents. We may not receive any such required
approvals or we may not receive them in a timely manner, including as a result
of factors or matters beyond our control. Satisfying any requirements of
regulatory agencies may delay the date of our completion of our initial business
combination beyond the required time frame. If we fail to consummate our initial
business combination within the required time frame we may be forced to dissolve
and liquidate.
 
 Our
investments in telecommunications and media companies may be extremely risky
due, in part, to market conditions, and we could lose all or part of our
investments.
 
 An
investment in telecommunications and media companies may be extremely risky
relative to an investment in companies operating in other
industries.
 
 Telecommunications
and media companies typically have limited operating histories, narrower product
lines and smaller market shares than larger businesses, which tend to render
them more vulnerable to competitors’ actions and market conditions, as well as
general economic downturns. In addition, telecommunications and media companies
generally have less predictable operating results, may from time to time be
parties to litigation, may be engaged in rapidly changing businesses with
products subject to a substantial risk of obsolescence, and may require
substantial additional capital to support their operations, finance expansion or
maintain their competitive position.
 
 In recent
years, a number of internet companies have filed for bankruptcy or liquidated,
and many large companies whose purchases affect the demand for products and
services in the telecommunications and media industries have experienced
financial difficulties, which may result in decreased demand for such products
and services in the future. Our investments in the telecommunications and media
industries may be extremely risky and we could lose all or part of our
investments.
 
 The
information available regarding telecommunications and media companies is
limited which could result in poor investment decisions on our part and we could
lose all or part of our investments.
 
 Many
telecommunications and media companies are privately owned and there is
generally little publicly available information about these businesses;
therefore, we may not learn all of the material information we need to know
regarding these businesses. As a result, we may make investment decisions based
on incomplete information or we may be unaware of material problems in a
business in which we invest, which make our investments extremely
risky.
 
 If
we make an investment in a telecommunications and media company that is
dependent on current management, the loss of such management may materially
affect results of operations.
 
 Telecommunications
and media companies are often dependent on the management talents and efforts of
a small group of persons; therefore, the death, disability, resignation or
termination of one or more of these persons could have a material adverse impact
on the operations of any telecommunications and media companies we may
acquire.
 
 17
 The
telecommunications and media industries are highly cyclical, which may
materially affect our future performance and ability to sell our products or
services and, in turn, hurt our profitability.
 
 Customers
of telecommunications and media products and services tend to defer purchases
during periods of economic weakness, opting instead to continue to use what they
already own. As a consequence, revenues and earnings for telecommunications and
media companies may fluctuate more than those of less economically sensitive
companies. Due to the cyclical nature of the telecommunications and media
industries, inventories may not always be properly balanced, resulting in lost
sales when there are shortages or write-offs when there are excess inventories.
This may materially adversely affect the business, financial condition, and
results of operations of any target businesses that we may acquire. Moreover,
many of the customers of telecommunications and media products and services also
may be subject to similar cycles and less able to pay for such products and
services during periods of economic weakness.
 
 If
we are unable to keep pace with the changes in the telecommunications and media
industries, the products of any target business that we acquire could become
obsolete and it could materially hurt our results of operations.
 
 The
telecommunications and media industries are generally characterized by intense,
rapid changes, often resulting in product obsolescence or short product life
cycles. Our ability to compete after the consummation of a business combination
will be dependent upon our ability to keep pace with changes in the industry. If
we are ultimately unable to adapt our operations as needed, our business,
financial condition and results of operations following a business combination
will be materially adversely affected.
 
 The
telecommunications and media industries are highly competitive and we may not be
able to compete effectively which could materially adversely affect our revenues
and profitability upon consummation of a business combination.
 
 The
telecommunications and media industries are rapidly evolving and intensely
competitive. We expect competition to intensify in the future. Many of the
competitors we will face upon consummation of a business combination will have
significantly greater financial, technical, manufacturing, marketing and other
resources than we do. Competing with these companies after a business
combination will require investment by us in engineering, research and
development and marketing. We may not have the resources to make these
investments and may not be successful in making these investments. In addition,
the management of our
 competitors
may have greater operating resources and experience in their respective
industries. Some of these competitors may also offer a wider range of services
than we can and may have greater name recognition and a larger client base. For
example, cable network operators and communications operators are increasingly
offering similar products in an effort to become an all-in-one provider of
voice, high speed internet access and video services to customers. These
competitors may be able to respond more quickly and effectively to new or
changing opportunities, technologies and client requirements. They may also be
able to undertake more extensive promotional activities, offer more attractive
terms to clients, and adopt more aggressive pricing policies. If we are unable
to compete effectively following a business combination, our business, financial
condition, results of operations and prospects could be materially adversely
affected.
 
 We
may not be able to comply with government regulations that may be adopted with
respect to the telecommunications and media industries.
 
 The
telecommunications and media industries have historically been subject to
substantial government regulation. The Federal Communications Commission, or
FCC, is continuing implementation of the Communications Act of 1996, which, when
fully implemented, may significantly impact the telecommunications and media
industries and change federal, state and local laws and regulations regarding
the provision of cable, internet and telephony services. After we complete a
business combination, these regulations may materially affect the types of
products or services we may offer, the rates we are permitted to charge and our
method of operation. We cannot assure you that regulations currently in effect
or adopted in the future will not have a material adverse affect on our ability
to acquire a particular target or the operations of a business acquired by
us.
 
 We
may be unable to protect or enforce the intellectual property rights of any
target businesses that we acquire.
 
 After
completing a business combination, the procurement and protection of trademarks,
copyrights, patents, domain names, trade dress, and trade secrets will likely be
critical to our success. We will likely rely on a combination of copyright,
trademark, trade secret laws and contractual restrictions to protect any
proprietary technology and rights that we may acquire. Despite our efforts to
protect those proprietary technology and rights, we may not be able to prevent
misappropriation of those proprietary rights or deter independent development of
technologies that compete with the business we acquire. Our competitors may
claim that we are infringing on their intellectual property rights and seek
damages, the payment of royalties, licensing fees and/or an injunction against
the sale of our products or services. Litigation may be necessary in the future
to enforce our intellectual property rights, to protect our trade secrets, or to
determine the validity and scope of the proprietary rights of others. It is also
possible that third parties may claim we have infringed their patent, trademark,
copyright or other proprietary rights. Claims or litigation, with or without
merit, could result in substantial costs and diversions of resources, either of
which could have a material adverse effect on our competitive position and
business. Depending on the target business or businesses that we acquire, it is
likely that we will have to protect copyrights, trademarks, patents, and domain
names in an increasing number of jurisdictions, a process that is expensive and
may not be successful in every location. With respect to certain proprietary
rights, such as trademarks and copyrighted materials, of the target business or
businesses that we will acquire, we expect that the target business or
businesses will have entered into license agreements in the past and will
continue to enter into such agreements in the future. These licensees may take
actions that materially diminish the value of such target business or
businesses’ proprietary rights or cause material harm to such target business or
businesses’ reputation.
 
 18
 Government
regulation of the telecommunications and media industries and the uncertainty
over government regulation of the Internet could harm our operating results and
future prospects.
 
 Certain
segments of the telecommunications and media industries historically have been
subject to substantial government regulation, both in the United States and
overseas. If we complete a business combination with a target business or
businesses in these industries, changes in regulatory requirements in the United
States or other countries could affect the sales of our products, limit the
growth of the markets we serve, or require costly alterations of current or
future products. Future changes in tariffs by regulatory agencies or application
of tariff requirements to currently untariffed services could affect the sales
of our products for certain classes of customers.
 
 On the
other hand, few laws or regulations currently apply directly to access of or
commerce on the Internet. New regulations governing the Internet and Internet
commerce, if adopted, could have an adverse effect on our business, operating
results, and financial condition following a business combination. New
regulations governing the Internet and Internet commerce could include matters
such as changes in encryption requirements, sales taxes on Internet product
sales, and access charges for Internet service and/or content and/or commerce
providers.
 
 
 ITEM 1B.
              UNRESOLVED STAFF
      COMMENTS
  
 None.
 
 ITEM 2.
              PROPERTIES
  
 We do not
own any real estate or other physical properties. Our headquarters are located
at 179 Stony Brook Road, Hopewell, NJ 08525. Under an office administration
agreement between Granahan McCourt Capital LLC, a private investment firm, and
us, Granahan McCourt Capital LLC furnishes us with office facilities, equipment
and clerical services at the facilities in exchange for a payment of $10,000 per
month. We believe, based on our management’s experience, that our office
facilities are suitable and adequate for our business as it is presently
conducted.
 
 ITEM 3.
              LEGAL
      PROCEEDINGS
  
 None.
 
 ITEM 4.
              SUBMISSION OF MATTERS TO A VOTE
      OF SECURITY HOLDERS
  
 None.
 
 
 PART
II
  ITEM
      5.
              MARKET
      FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
      PURCHASES OF EQUITY
SECURITIES
   Market
Information
 
 Our
units, which consist of one share of our common stock, par value $0.0001 per
share, and one warrant to purchase one share of our common stock, trade on the
American Stock Exchange under the symbol “GHN.U.” Our warrants and common stock
have traded separately on the American Stock Exchange under the symbols “GHN.WS”
and “GHN,” respectively, since November 27, 2006. Each warrant entitles the
holder to purchase from us one share of our common stock at an exercise price of
$6.00 commencing on the later of our consummation of an initial business
combination or October 18, 2007. Our warrants will expire at 5:00 p.m., New York
City time, on October 18, 2010, or earlier upon redemption.
 
 The
following table sets forth, for the calendar quarter indicated, the high and low
sales prices per unit, warrant and share of common stock, respectively, as
reported on the AMEX,  The quotations listed below reflect
inter-dealer prices, without retail markup, markdown or commission and may not
necessarily represent actual transactions.
  19
  Units
                
                
                Warrants
                
                
                Common
      StockQuarter
      Ended
                
                High
                
                
                Low
                
                
                High
                
                
                Low
                
                
                High
                
                
                Low2006Fourth
      Quarter 2006 (11/27/06 - 12/31/06)
                
                
                8.05
                
                
                
                7.65
                
                
                
                0.65
                
                
                
                0.50
                
                
                
                7.55
                
                
                
                7.302007First
      Quarter
                
                
                8.22
                
                
                
                8.00
                
                
                
                0.72
                
                
                
                0.60
                
                
                
                7.72
                
                
                
                7.59Second
      Quarter
                
                
                9.00
                
                
                
                8.23
                
                
                
                1.39
                
                
                
                0.65
                
                
                
                8.00
                
                
                
                7.78Third
      Quarter
                
                
                9.00
                
                
                
                8.25
                
                
                
                1.29
                
                
                
                0.63
                
                
                
                7.90
                
                
                
                7.85Fourth
      Quarter
                
                
                8.50
                
                
                
                8.20
                
                
                
                0.83
                
                
                
                0.50
                
                
                
                7.85
                
                
                
                7.822008First
      Quarter 2008 (1/1/08 - 3/14/08)
                
                $
                8.40
                
                
                $
                8.06
                
                
                $
                0.65
                
                
                $
                0.24
                
                
                $
                8.00
                
                
                $
                7.95
  Holders
 
 As of
March 14, 2008, we had approximately 1 holder of record of our units, 8 holders
of record of our common stock and 4 holders of record of our
warrants.
 
 Dividends
 
 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. If, after
we consummate a business combination, we become a holding company with a
risk-bearing operating company subsidiary, the ability of that subsidiary to pay
dividends to our stockholders, either directly or through us, may be limited by
statute or regulation.
 
 Performance
 
 The graph
below compares the cumulative total return of our common stock from November 27,
2006 through December 31, 2007 with the cumulative total return of
companies comprising the S&P 500 Index and a peer group selected by us. The
graph plots the growth in value of an initial investment of $100 in each of our
common stock, the S&P 500 Index and the peer group selected by us over the
indicated time periods, and assuming reinvestment of all dividends, if any, paid
on our the securities. We have not paid any cash dividends and, therefore, the
cumulative total return calculation for us is based solely upon stock price
appreciation and not upon reinvestment of cash dividends. The stock price
performance shown on the graph is not necessarily indicative of future price
performance.
 
 Our peer
group is comprised of the following companies that were blank check companies
and that, as of the measurement dates, had neither completed a business
combination nor announced a business combination:  HD Partners Acquisition
Corporation, Affinity Media International Corp., Marathon Acquisition
Corporation, Rhapsody Acquisition Corporation and Fortissimo Acquisition
Corp.
 
 20
  
   Recent
Sales of Unregistered Securities
 
 On July
20, 2006, we sold 3,234,375 shares of our common stock (after giving effect to a
subsequent 0.72 for 1 reverse stock split) to the parties set forth below for
$2,000 in cash, at a purchase price of $0.000618 per share, without registration
under the Securities Act:
  Stockholders
              
              Number
                of SharesDavid
      C. McCourt
              
              2,574,900Barry
      S. Sternlicht
              
              32,400George
      J. Tenet
              
              32,400Roger
      L. Werner
              
              32,400Paul
      N. D’Addario
              
              32,400Barak
      Bar-Cohen
              
              72,000Ellyn
      M. Ito
              
              36,000
 
 Such
shares were issued in connection with our organization pursuant to the exemption
from registration contained in Section 4(2) of the Securities Act.
 
 Since the
underwriters’ over-allotment option was not exercised, on January 16, 2007 we
repurchased 421,875 shares of our common stock from David C. McCourt for
$261.
 
 On
October 18, 2006, David C. McCourt purchased from us an aggregate of 4,000,000
warrants in a private placement at a purchase price of $1.00 per warrant for an
aggregate price of $4,000,000. Such warrants were issued pursuant to an
exemption from registration contained in Section 4(2) of the Securities Act
as they were sold in a transaction not involving a public offering.
 
 The
$4,000,000 proceeds from the issuance and sale of the private placement warrants
were placed in a trust account and will be part of the liquidating distribution
to our public stockholders in the event of liquidation prior to our business
combination or in the event that less than 20% of our public stockholders elect
to convert their shares of common stock in connection with a business
combination.
 
 21
 The
private placement warrants have terms and provisions that are identical to those
of the warrants sold as part of our units but will not be transferable or
salable by Mr. McCourt until after the consummation of the initial business
combination, except that Mr. McCourt is permitted to transfer the warrants sold
in the private placement in certain limited circumstances, such as by will in
the event of his death or to other of the Company’s officers and
directors.  However, the transferees receiving such private placement
warrants will be subject to the same sale restrictions imposed on Mr. McCourt.
In the event of liquidation prior to our initial business combination, the
private placement warrants will expire worthless.
 
 Use
of Proceeds from our Initial Public Offering and Private
Placement
 
 On
October 24, 2006, we closed our initial public offering of 11,250,000 units with
each unit consisting of one share of our common stock and one warrant to
purchase one share of our common stock at an exercise price of $6.00 per share.
All of the units registered were sold, at an offering price of $8.00 per unit,
and generated gross proceeds of $90,000,000. The securities sold in our initial
public offering were registered under the Securities Act of 1933 on a
registration statement on Form S-1 (No. 333-136048). The Securities and Exchange
Commission declared the registration statement effective on October 18, 2006.
Deutsche Bank Securities Inc. served as the lead underwriter in our initial
public offering.
 
 Of the
gross proceeds from the Offering: (i) we deposited $88,650,000 into a trust
account at JP Morgan Chase Bank, NA, maintained by Continental Stock Transfer
& Trust Company, as trustee, which amount included $3,600,000 of contingent
underwriting discount and $4,000,000 that we received from the sale of warrants
to David C. McCourt, our President, CEO and Chairman; (ii) the underwriters
received $2,700,000 as underwriting discount (excluding the contingent
underwriting discount); and (iii) we used $707,915 for offering expenses. None
of the offering expenses were paid directly or indirectly to any of our
officers, directors or 10% stockholders. The net proceeds deposited into the
trust account remain on deposit in the trust account, except for a withdrawal of
$280,000 to pay estimated state income tax, and $3,725,900 in interest in the
trust earned through December 31, 2007.
 
 Following
the consummation of our initial public offering through December 31, 2007, we
incurred an aggregate of $1,993,750 in additional expenses, which consists of
approximately $182,428 for director and officer insurance and other insurance,
$911,107 for legal and accounting fees unrelated to our initial public offering,
$240,659 for Delaware franchise taxes, $35,322 for registration and filing fees,
$144,516 paid to Granahan McCourt Capital, LLC, through December 31, 2007 for
our office space and other general and administrative services, $435,193 for
travel expenses, consulting fees and other expenses incurred in connection
with due diligence investigations of potential acquisition targets and
$44,525 for other expenses. Through December 31, 2007, we earned interest
income of $82 on funds held outside the trust account. We also accrued an income
tax benefit of $552,600. The net remaining proceeds from the initial public
offering after deducting the underwriting discounts and commissions, the
offering expenses and all other expenditures through December 31, 2007 were
approximately $92,402,080, which consists of $306,180 of cash held outside the
trust account and $92,095,900 held in the trust account, including accrued
interest.
 
 ITEM
6.SELECTED FINANCIAL DATA
 The
following table summarizes the relevant financial data for our business and
should be read in conjunction with our financial statements, and the notes and
schedules related thereto, which are included in this report. To date, our
efforts have been limited to organizational activities and activities relating
to our initial public offering and sourcing a suitable business combination
candidate.
  Period
      from January 1, 2007 to December 31, 2007
                
                
                Period
      from July 10, 2006 (inception) to December 31, 2006
                
                
                Period
      from July 10, 2006 (inception) to December 31, 2007Revenues
                
                $
                -
                
                
                $
                -
                
                
                $
                -Operating
      loss
                
                $
                (1,770,232
                )
                
                $
                (223,518
                )
                
                $
                (1,993,750
                )Interest
      income
                
                $
                3,185,656
                
                
                $
                587,219
                
                
                $
                3,772,875Net
      income
                
                $
                1,915,424
                
                
                $
                416,301
                
                
                $
                2,331,725Net
      income attributable to common stock holders
                
                $
                1,344,250
                
                
                $
                312,044
                
                
                $
                1,656,294Basic
      and diluted net income per share
                
                $
                0.25
                
                
                $
                0.05
                
                
                $
                0.37Weighted
      average shares outstanding
                
                
                11,829,838
                
                
                
                6,803,341
                
                
                
                10,207,184Working
      capital (excludes assets held in trust and deferred underwriting
      fees)
                
                $
                83,224
                
                
                $
                1,754,602
                
                
                $
                83,224Total
      assets
                
                $
                93,342,466
                
                
                $
                91,146,703
                
                
                $
                93,342,466Common
      stock, subject to possible conversion $2,249,999 shares at conversion
      value
                
                $
                18,405,423
                
                
                $
                17,834,249
                
                
                $
                18,405,423Stockholders'
      equity
                
                $
                70,921,056
                
                
                $
                69,577,067
                
                
                $
                70,921,056
  22
  ITEM 7.
              MANAGEMENT’S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS
 
 Overview
 
 We are a
blank check company organized under the laws of the State of Delaware on
July 10, 2006. We were formed for the purpose of acquiring, or acquiring
control of, one or more assets or operating businesses in the telecommunications
and media industries through a merger, capital stock exchange, asset or stock
acquisition or other similar business transaction.  We have not generated
revenue to date other than interest income. We are considered to be in the
development stage and are subject to the risks associated with activities of
development stage companies. Since our initial public offering in October, 2006,
we have been actively engaged in identifying a suitable business combination
candidate. We have met with potential target companies, service professionals
and other intermediaries to discuss our company, the background of our
management and our combination preferences. However, we have not, entered into a
definitive agreement for, nor consummated, any business combination. We have
selected December 31 as our fiscal year end. Our securities trade on the
American Stock Exchange.
 
 We must
complete a business combination with a fair market value of at least 80% of our
net assets (excluding the amount held in the trust account representing a
portion of the underwriters’ discount) at the time of acquisition by April 24,
2008 (18 months after the consummation of our initial public offering) or
by October 24, 2008 (within 24 months from the consummation of our initial
public offering if a letter of intent, agreement in principle or definitive
agreement has been executed within 18 months after the consummation of our
initial public offering). If we are unable to complete a business combination
within the prescribed time frame and are forced to dissolve and liquidate our
assets, the per share liquidation distribution may be less than $8.00 because of
the expenses paid in our initial public offering. Furthermore, there will be no
distribution from the trust account with respect to our outstanding warrants
which will expire worthless if we dissolve and liquidate before the completion
of a business combination.
 
 Results
of Operations
 
 On
October 24, 2006, we consummated our initial public offering of 11,250,000
Units. Each Unit consists of one share of our common stock, par value $0.0001
per share, and one warrant entitling the holder to purchase one share of our
common stock at a price of $6.00. The public offering price of each Unit was
$8.00, and we generated gross proceeds of $90,000,000 in the initial public
offering.  Of the gross proceeds: (i) we deposited $88,650,000 into a trust
account at Lehman Brothers Inc., maintained by Continental Stock Transfer &
Trust Company, as trustee, which included $3,600,000 of contingent underwriting
discount and $4,000,000 that we received from the issuance and sale of 4,000,000
warrants to David C. McCourt, our President, Chief Executive Officer and
Chairman of the Board, on October 18, 2006 in a private placement; (ii) the
underwriters received $2,700,000 as underwriting discount (excluding the
contingent underwriting discount); and (iii) we retained $550,000 for offering
expenses.
 
 The
proceeds deposited in the trust account will not be released from the trust
account until the earlier of the completion of a business combination or the
expiration of the time period during which we may complete a business
combination. The proceeds held in the trust account (other than the contingent
underwriting discount) may be used as consideration to pay the sellers of a
target business with which we complete a business combination. To the extent
that our capital stock is used in whole or in part as consideration to effect a
business combination, the proceeds held in the trust account (other than the
contingent underwriting discount) will be used to finance the operations of the
target business.
 
 Income,
before income taxes, for the fiscal year ended December 31, 2007 was $1,415,424
and consisted of interest income of $3,185,656 earned predominantly on the trust
account, offset by an aggregate of $1,770,232 in expenses, which consist of
$152,179 for director and officer insurance and other insurance, $35,322 for
registration and filing fees, $844,468 for legal and accounting fees unrelated
to our initial public offering, $165,000 for Delaware franchise taxes, $120,000
for administrative services expense paid to Granahan McCourt Capital, LLC
for our office space and other general and administrative services, $435,193 for
travel expenses, consulting fees and other expenses incurred in connection with
due diligence investigations of potential acquisition targets and $18,070 for
other expenses. The net remaining proceeds from the initial public offering and
the private placement, after deducting the underwriting discounts and
commissions (excluding the contingent underwriting discount), the offering
expenses and all other expenditures through December 31, 2007 were approximately
$92,402,080, consisting of $306,180 of cash held outside the trust account and
$92,095,900 held in the trust account, including accrued interest.
 
 Income,
before income taxes, for the period since inception on July 10, 2006 until
December 31, 2007 was $1,779,125 and consisted of interest income of $3,772,875
earned predominantly on the trust account, offset by an aggregate of $1,993,750
in expenses, which consist of $182,428 for director and officer insurance and
other insurance, $35,322 for registration and filing fees, $911,107 for legal
and accounting fees unrelated to our initial public offering, $240,659 for
Delaware franchise taxes, $144,516 paid to Granahan McCourt Capital, LLC, for
our office space and other general and administrative services, $435,193 for
travel expenses, consulting fees and other expenses incurred in connection with
due diligence investigations of potential acquisition targets and
$44,525 for other expenses. The net remaining proceeds from the initial
public offering after deducting the underwriting discounts and commissions
(excluding the contingent underwriting discount), the offering expenses and all
other expenditures through December 31, 2007 were $92,402,080, which consist of
$306,180 of cash held outside the trust account and $92,095,900 held in the
trust account, including accrued interest.
  On March
14, 2008, David C. McCourt loaned $250,000 to us in exchange for a promissory
note from us in such amount.  The principal balance of this note is
payable on the earlier of (a) one business day following Mr. McCourt’s written
demand for payment and (b) upon consummation of a business
combination.  The promissory note bears no interest and has no
recourse against the funds in the trust account.
  23
  We
believe that the working capital available to us, in addition to the funds
available to us outside of the trust account and the loan from Mr. McCourt, will
be sufficient to allow us to operate through October, 2008, assuming that a
business combination is not consummated during that time. We do not believe we
will need to raise additional funds during this time in order to meet the
expenditures required to meet our operating expenses. However, we may issue
additional capital stock, debt or a combination of capital stock and debt to
complete one or more business combinations.
 
 Contractual
Obligations and Commitments
 
 Commitments.  As
of December 31, 2007, we had no long-term commitments.
 
 Contractual
Obligations. The Company is obligated to pay Granahan McCourt Capital, LLC a
monthly fee of $10,000 for general and administrative services including office
space, utilities and administrative support during the period commencing October
24, 2006 until the earlier of (i) the completion of our initial business
combination and (ii) our dissolution.
 
 Critical
Accounting Policies
 
 The
preparation of financial statements and related disclosures in conformity with
general accepting accounting principles in the United States requires management
to make estimates and assumptions that affect the reported amounts of assets,
liabilities, and disclosure of contingent assets and liabilities at the date of
the financial statements, and revenues and expenses during the periods reported.
Actual results could materially differ from those estimates. We have determined
that we currently are not subject to any critical accounting policies.
 
 ITEM 7A.
              QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET
RISK
 
 To date,
our efforts have been limited to organizational activities and activities
relating to our initial public offering and the identification of a target
business. We have neither engaged in any operations nor generated any revenues.
As the proceeds from our initial public offering held in trust have been
invested in short term investments, our only market risk exposure relates to
fluctuations in interest.
 
 As of
December 31, 2007, $91,862,529 of the net proceeds of our initial public
offering (including accrued interest) was held in trust for the purposes of
consummating a business combination.  Continental Stock Transfer &
Trust Company, the trustee, has invested the money held in the trust account at
JPMorgan Chase Bank, NA, in the Lehman Brothers Tax Free Money Market Fund which
invests in securities exempt from federal income taxes.  As of
December 31, 2007, the effective, annualized, federal tax-free interest
rate payable on our investment was 3.587%.
 
 We have
not engaged in any hedging activities since our inception on July 10, 2006. We
do not expect to engage in any hedging activities with respect to the market
risk to which we are exposed.
 
 ITEM 8.          
 FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 
 Financial
statements are attached hereto beginning on Page F-1.
 
 ITEM 9.
              CHANGES
      IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
      DISCLOSURE
 
 None.
 
 ITEM 9A.
              CONTROLS
      AND PROCEDURES
  a) Evaluation of Disclosure Controls
and Procedures.An evaluation of the effectiveness of our disclosure
controls and procedures as of December 31, 2007 was made under the supervision
and with the participation of our management, including our chief executive
officer and chief financial officer. Based on that evaluation, they concluded
that our disclosure controls and procedures are effective as of the end of the
period covered by this report to ensure that information required to be
disclosed by us in reports that we file or submit under the Securities Exchange
Act of 1934 is recorded, processed, summarized and reported within the time
periods specified in Securities and Exchange Commission rules and
forms.
 
 (b) Management’s Annual Report on
Internal Control Over Financial Reporting.Pursuant to Section 404 of the
Sarbanes-Oxley Act of 2002, and the implementing rules of the Securities and
Exchange Commission, our management assessed the effectiveness of the Company’s
internal control over financial reporting as of December 31, 2007. Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting for the company. Internal control over
financial reporting is a process to provide reasonable assurance regarding the
reliability of our financial reporting for external purposes in accordance with
accounting principles generally accepted in the United States of America.
Internal control over financial reporting includes maintaining records that in
reasonable detail accurately and fairly reflect our transactions; providing
reasonable assurance that transactions are recorded as necessary for preparation
of our financial statements; providing reasonable assurance that receipts and
expenditures of company assets are made in accordance with management
authorization; and providing reasonable assurance that unauthorized acquisition,
use or disposition of company assets that could have a material effect on our
financial statements would be prevented or detected on a timely basis. Because
of its inherent limitations, internal control over financial reporting is not
intended to provide absolute assurance that a misstatement of our financial
statements would be prevented or detected.
 
 24
 Management
conducted an evaluation of the effectiveness of our internal control over
financial reporting based on the framework in Internal Control - Integrated
Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission. Based on this evaluation, management concluded that the
company’s internal control over financial reporting was effective as of December
31, 2007.
 
 The
Company’s management assessment of the effectiveness of its internal control
over financial reporting as of December 31, 2007 has been audited by
Pressman Ciocca Smith, LLP, our independent registered public accounting
firm. Their report appears in the “Exhibits and
Financial Statements”
Section.
 
 
 ITEM 9B.
              OTHER
      INFORMATION
 
 None.
 
 
 PART
III
 
 ITEM 10.       
DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
 
 Board
of Directors and Executive Officers
 
 Our
current directors and executive officers are as follows:
  Name
              
              Age
              
              PositionDavid
      C. McCourt
              
              51
              
              Chairman
      and Chief Executive Officer and Chief Operating OfficerBarry
      S. Sternlicht
              
              47
              
              DirectorGeorge
      J. Tenet
              
              55
              
              DirectorRoger
      L. Werner, Jr.
              
              58
              
              DirectorPaul
      N. D’Addario
              
              54
              
              DirectorBarak
      Bar-Cohen
              
              37
              
              Chief
      Financial OfficerEllyn
      M. Ito
              
              39
              
              Chief
      Administrative OfficerPatrick
      Tangney
              
              38
              
              Executive
      Vice President, Strategy
  David C. McCourt has served as
our President, Chief Executive Officer and Chairman of the Board since our
inception. In addition, Mr. McCourt is the Founder, Chief Executive Officer
and Chairman of the Board of Granahan McCourt Capital, LLC, a private investment
firm focused on making minority investments and advising companies in the
telecommunications and media industries, a position he has held since January
2005. Over the last 26 years, Mr. McCourt has been a pioneer across the
telecommunications and media industries, founding or acquiring over ten
companies in four countries in North America and Europe. Under his leadership,
these companies completed capital raising and merger transactions valued in
excess of $7.0 billion. In 1985, Mr. McCourt established Discovery TV, an
independent television station in Grenada producing a range of programming for
the Caribbean market. In 1987, Mr. McCourt founded a competitive telephone
company, Corporate Communications Network. Corporate Communications Network was
later merged with a subsidiary of MFS Communications to create MFS/McCourt. MFS
Communications was later sold to Worldcom. In the early 1990’s Mr. McCourt
formed a partnership based in London, England called McCourt Kiewit
International that designed and built telecommunication systems across Europe.
In 1993, Mr. McCourt formed a $196 million partnership with Peter
Kiewit Sons, Inc. and acquired control of C-TEC, a diversified
telecommunications company based out of Wilkes-Barre, Pennsylvania. Under
Mr. McCourt’s leadership as Chief Executive Officer and Chairman, C-TEC
recapitalized its balance sheet and divested its non-strategic assets. In
September 1997, C-TEC completed a tax free transaction splitting the company
into three publicly traded companies: Cable Michigan, Commonwealth Telephone
Company, and RCN Corporation. Mr. McCourt was Chief Executive Officer and
Chairman of Cable Michigan from 1993 to 1999, he was Chief Executive Officer and
Chairman of Commonwealth Telephone Company from 1997 to 2000, served as Chairman
from 2000 until 2003 and was Chief Executive Officer and Chairman of RCN
Corporation from 1997 through 2004, the latter of which was reorganized under
Chapter 11 of the U.S. Bankruptcy Code in 2004. RCN Corporation is a
facilities-based competitive provider of bundled phone, cable and high speed
internet services delivered over its own fiber-optic local network to consumers
located in the Boston, New York, Philadelphia, Chicago, San Francisco and Los
Angeles metropolitan markets. Mr. McCourt has received numerous awards over
his career including “Entrepreneur of the Year” by Ernst & Young, LLP as
well as the American Irish Historical Society Gold Medal Award. In 2005,
Mr. McCourt received an Emmy Award for his role as Executive Producer of
the award-winning children’s show “Reading Rainbow.” Mr. McCourt is on the
National Advisory Board of JPMorgan Chase Bank, the North American Advisory
Board of the Michael Smurfit Graduate School of Business at University College
in Dublin, Ireland, the Board of Overseers of the Robert Wood Johnson Medical
School of the University of Medicine and Dentistry in New Jersey, and is the
Chairman and interim Chief Executive Officer and Chief Operating Officer of
Narrowstep, Inc. — a television over the internet company. Mr. McCourt
holds a B.A. from Georgetown University and is a frequent public speaker
and contributor to national and international publications on business and
regulatory issues in the telecommunications and media industries.
 
 25
 Barak Bar-Cohen has served as
our Chief Financial Officer since our inception. Mr. Bar-Cohen has been
President and Chief Operating Officer of Granahan McCourt Capital, LLC
since January 2005. From April 1999 through December 2004, Mr. Bar-Cohen
served in several senior management roles at RCN Corporation. From
October 2003 through December 2004, Mr. Bar-Cohen served as Vice
President of Customer Service, Marketing and Public Relations at RCN where his
responsibilities included managing all customer care and direct marketing
functions at corporate and in the markets across the company. From
January 2002 through September 2003, Mr. Bar-Cohen served as Vice
President of Financial Operations at RCN where his responsibilities included
managing the New York market. Prior to 2002, Mr. Bar-Cohen held roles as
Director of Corporate Initiatives at RCN, where he implemented cost savings
initiatives across the company, as well as Product Manager of Internet Product
Development. From February 1997 through August 1998,
Mr. Bar-Cohen was Vice President of Investment Banking at Zannex
Investments, a boutique investment firm based in Tel-Aviv, Israel, where he
raised seed-funding for technology start-up companies. From 1992 through 1996,
Mr. Bar-Cohen worked as a Senior Associate at Putnam, Hayes & Bartlett,
a world-wide economic consulting firm based out of Washington, DC, where he
specialized in financial analysis of securities fraud litigation cases as well
as quantitative analysis of mergers and acquisitions for electric utilities and
energy companies. Mr. Bar-Cohen holds a B.A. in Economics with Honors from
Brandeis University as well as an M.B.A. from the Tuck School of Business
at Dartmouth College.
 
 Ellyn M. Ito has served as our
Chief Administrative Officer since our inception. Ms. Ito has been Chief
Administrative Officer of Granahan McCourt Capital, LLC, a position she has held
since March 2005. From August 2003 through December 2004, Ms. Ito
served as Senior Vice President of Employee Services at RCN Corporation. In this
role, Ms. Ito was responsible for all corporate compliance, compensation,
benefits, payroll, staffing and recruiting functions across the company. From
November 1999 through July 2003, Ms. Ito was Director of
Corporate Staff Development and Director, Staffing at RCN Corporation. From
October 1998 to October 1999, Ms. Ito was a Management Consultant for
Ernst and Young, LLC, serving clients within their Finance, Technology and
Administration Group. Prior to this role, Ms. Ito ran her own independent
consulting practice, working with Fortune 500 clients such as MetLife,
Harvard Management, Sun Life Financial, New England Financial, and Putnam
Investments in addressing their talent acquisition and human capital management.
Ms. Ito is the recipient of the “Top Human Resource Business Leader for
2004” Award from the Society of Human Resources Management Organization and
holds a B.A. from the University of Colorado.
  Patrick
Tangneyhas served as
executive price president, strategy since March 2008 and as a consultant since
August 2007.  From 2000 through mid-2007, Mr. Tangney worked in
the Investment Banking division ofCitigroup Global Markets in London and
New York, most recently as a Director, and advised companies in the
telecom, media and technology sectors.  He also has experience in
various other sectors, including online and mobile software, towers, gaming,
wireless telephony, fixed telephony, newspapers, and
entertainment.  Mr. Tangney's experience prior to Citigroup includes
working as a management consultant with McKinsey & Company and as a
transactional attorney with Davis Polk & Wardwell.   Mr.
Tangney received an A.B. from Duke University, with honors, a J.D. from Columbia
University and was a Fulbright Scholar.
 
 Barry S. Sternlicht has served
as a director since our inception. He is Chairman and Chief Executive Officer of
Starwood Capital Group, a private real estate investment firm he formed in 1991.
From 1995 through 2004, Mr. Sternlicht was Chairman and CEO of Starwood
Hotels & Resorts Worldwide, Inc., a company he founded in 1995.
Mr. Sternlicht is a trustee of Brown University. He serves on the
Board of Directors of National Golf, The Estée Lauder Companies, the National
Advisory Board of JPMorgan Chase Bank, the Advisory Board of Eurohypo Bank, the
Juvenile Diabetes Research Foundation’s National Leadership Advocacy Program,
Kids in Crisis, the Business Committee for the Arts, and the Center for
Christian-Jewish Understanding. Mr. Sternlicht received his B.A., magna cum
laude, with honors from Brown University. He earned an M.B.A. with
distinction from Harvard Business School.
 
 George J. Tenet has served as
a director since our inception. Since July 2004, Mr. Tenet currently
serves as a distinguished professor at Georgetown University. From
July 1997 through June 2004, Mr. Tenet has served as the Director
of the U.S. Central Intelligence Agency. Prior to that, Mr. Tenet served in
other government positions, including as Deputy Director of the C.I.A., Special
Assistant to the President and Senior Director for Intelligence Programs at the
National Security Council and Staff Director of the Senate Select Committee on
Intelligence. Mr. Tenet serves as a member of the Board of: L-1 Identity
Solutions Inc., Guidance Software and the British defense firm, QinetiQ. 
In addition he is the Chairman of the CIA Memorial Foundation. 
Mr. Tenet holds a B.S.F.S. from the Georgetown University School of Foreign
Service and an M.I.A. from the School of International Affairs at
Columbia University.
 
 Roger L. Werner, Jr. has
served as a director since our inception. From 1995 to until 2001, he developed
and served as the President and CEO of Speedvision and Outdoor life cable
television networks. From 1990 to 1994, Mr. Werner served as President and
CEO of Daniels Programming Ventures, LLC, where he managed Daniels interest with
Prime Ticket (now Fox Sports West), and Prime Sports Network Group, a joint
venture with Liberty Media, along with a number of other sports media
properties. From 1982 to 1988 he was the Chief Operating Officer of ESPN and
from 1988 through 1990 he was its Chief Executive Officer. Prior to joining
ESPN, he served as Engagement Manager for McKinsey and Company from 1979 to
1982. Mr. Werner serves on the Board of Directors of WATV Productions,
Outdoor Channel Holdings Inc. and Narrowstep, Inc. and is the CEO of
Outdoor Channel Holdings Inc. He is a graduate of Trinity College,
Hartford, Connecticut and holds an M.B.A. from the University of
Virginia.
 
 26
 Paul N. D’Addario has served
as a director since our inception.  Mr. D’Addario is the Founder and Senior
Managing Director of Palisades Ventures, a technology and media growth
fund.  Mr. D’Addario was the former senior member of the Media Telecom
Group of Credit Suisse First Boston from 2000 to 2004, and prior to this, held
several positions within Donaldson, Lufkin & Jenrette Securities since the
spring of 1987, including Managing Director & Principal from 1994 to
2000.  At DLJ, Mr. D’Addario also served as Head of New Media and Head of
West Coast Media and managed a number of financings and M&A deals for major
media, technology and entertainment companies including: Crown Media Holdings,
Inc. and IMAX Corp.  Mr. D’Addario is a board observer for Omneon Video
Networks, a provider of media server solutions for the broadcast and video
industry, a board member of Language Weaver, a software company that specializes
in statistical machine translation software and Showtime Arabia, a pay TV
platform in the Middle East.  Prior to his employment by DLJ, Mr. D’Addario
was in the M&A Group of Weil, Gotshal & Manges LLP.  Mr. D’Addario
received a B.A. from Boston College, a M.Sc. from the London School of
Economics and a J.D. from Villanova Law School.
 
 Number
and Terms of Directors
 
 The term
of office of the first class of directors, consisting of Messrs. Werner and
D’Addario, will expire at our first annual meeting of stockholders. The term of
office of the second class of directors, consisting of Messrs.  Tenet and
Sternlicht, will expire at the second annual meeting. The term of office of the
third class of directors, consisting of Mr. McCourt, will expire at the third
annual meeting. All of our directors have served as directors since the
inception of our company.
 
 Since
there has not been an annual stockholders meeting to elect new directors and
there will likely not be an annual stockholders meeting to elect new directors
prior to the consummation of any business combination, we expect that all of the
current directors will continue as directors until at least the consummation of
the business combination.
 
 Director
Independence
 
 Our board
of directors has determined that Barry S. Sternlicht, George J. Tenet, Roger L.
Werner, Jr. and Paul N. D’Addario, a majority of the directors on our board, are
“independent directors” as defined in Rule 10A-3 of the Securities Exchange
Act of 1934, as amended, and the rules of the American Stock Exchange. By
“independent director,” we mean a person other than an officer or employee of
ours or any other individual having a relationship, which, in the opinion of our
board of directors would interfere with the director’s exercise of independent
judgment in carrying out the responsibilities of a director. Our independent
directors will have regularly scheduled meetings at which only independent
directors are present.
 
 As
provided in our by-laws, any affiliated transactions will be on terms no less
favorable to us than could be obtained from independent parties. Any affiliated
transactions must be approved by a majority of our independent directors and our
directors who do not have a pecuniary interest in the transaction, in either
case who had access, at our expense, to attorneys or independent legal counsel.
Whether or not independent, our directors will be our fiduciaries and, as such,
must exercise discretion over future transactions consistent with their
responsibilities as fiduciaries. Moreover, we intend to obtain estimates from
unaffiliated third parties for similar goods or services, taking into account,
in addition to price, the quality of the goods or services to be provided by
such third parties to ascertain whether such transactions with affiliates are on
terms that are no less favorable to us than are otherwise available from
unaffiliated third parties.
 
 Committees
of the Board of Directors
 
 Our board
of directors has established the following standing committees: audit committee
and nominating and corporate governance committee.
 
 Audit
Committee
 
 Our board
of directors has an audit committee, which reports to the board of directors.
The audit committee consists of Mr. D’Addario, as chairman, and Messrs.
Sternlicht and Werner. The audit committee is responsible for approving our
independent accountants, reviewing with our independent accountants the plans
and results of the audit engagement, approving professional services provided by
our independent accountants, reviewing the independence of our independent
accountants and reviewing the adequacy of our internal accounting
controls.
 
 Each of
the members of the audit committee is “financially literate,” meaning that they
are able to read and understand fundamental financial statements, including a
company’s balance sheet, income statement and cash flow statement. In addition,
the audit committee has, and will continue to have, at least one member who has
past employment experience in finance or accounting, requisite professional
certification in accounting, or other comparable experience or background that
results in the individual’s financial sophistication. The board of directors has
determined that Mr. D’Addario satisfies the definition of financial
sophistication, qualifies as an “audit committee financial expert,” as defined
under the SEC’s rules and regulations and is independent, as defined by our
listing standards.
 
 27
 Nominating
and Corporate Governance Committee
 
 The
members of the nominating and corporate governance committee are Messrs. Tenet,
Sternlicht and Werner. Mr. Tenet serves as chairman of the nominating and
corporate governance committee. The nominating and corporate governance
committee is responsible for selecting, researching and nominating directors for
election by our stockholders, selecting nominees to fill vacancies on the board
or a committee of the board, developing and recommending to the board a set of
corporate governance principles and overseeing the evaluation of the board and
our management.
 
 The
guidelines for selecting nominees, which are specified in the Nominating
Committee Charter, generally provide that persons to be nominated should be
actively engaged in business endeavors, have an understanding of financial
statements, corporate budgeting and capital structure, be familiar with the
requirements of a publicly traded company, be familiar with industries relevant
to our business endeavors, be willing to devote significant time to the
oversight duties of the board of directors of a public company, and be able to
promote a diversity of views based on the person’s education, experience and
professional employment.  The nominating committee evaluates each
individual in the context of the board as a whole, with the objective of
recommending a group of that can best implement our business plan, perpetuate
our business and represent stockholder interests. The nominating committee may
require certain skills or attributes, such as financial or accounting
experience, to meet specific board needs that arise from time to time. The
nominating committee does not distinguish among nominees recommended by
stockholders and other persons.
 
 Section 16(a)
Beneficial Ownership Reporting Compliance
 
 Section 16(a)
of the Exchange Act requires our officers, directors and persons who own more
than 10% of a registered class of our equity securities to file reports of
ownership and changes in ownership with the SEC. Officers, directors and 10%
stockholders are required by regulation to furnish us with copies of all
Section 16(a) forms they file. Based solely on copies of such forms
received, we believe that, during the fiscal year ended December 31, 2007, all
16(a) filing requirements applicable to our officers, directors and greater than
10% beneficial owners were met in a timely manner.
 
 Code
of Ethics
 
 Our board
of directors has adopted a code of ethics, which establishes standards of
ethical conduct applicable to all our directors, officers and employees. This
code of ethics addresses conflicts of interest, compliance with disclosure
controls and procedures and internal control over financial reporting, corporate
opportunities and confidentiality requirements. The audit committee is
responsible for applying and interpreting our code of ethics in situations where
questions are presented to it.
 
 Our code
of ethics may be viewed and copied at the SEC’s Public Reference Room in
Washington, D.C. Information about the SEC’s Public Reference Room may be
obtained by calling the SEC at 1-800-SEC-0330. Our code of ethics also may be
available on the SEC’s website, http://www.sec.gov, or be obtained, after paying
a duplicating fee, by electronic request to publicinfo@sec.gov, or by writing
to: SEC’s Public Reference Room, 100 F Street, NE, Washington, D.C.
20549.
 
 We
undertake to provide without charge to any person, upon written or verbal
request of such person, a copy of our code of ethics. Requests for a copy should
be directed in writing to Granahan McCourt Acquisition Corporation, 179 Stony
Brook Road, Hopewell, NJ 08525, Attention: Barak Bar-Cohen or by telephone to
(609) 333-1200.
 
 Promoters
 
 We
consider Mr. McCourt to be our promoter as the term is defined within the rules
promulgated by the SEC under the Securities Act.
 
 ITEM 11.
EXECUTIVE COMPENSATION
 
 Compensation
Discussion and Analysis
 
 No
executive officer has received any cash compensation for services rendered to
us. Commencing on October 18, 2006, the effective date of the registration
statement through the consummation of a business combination, pursuant to a
letter agreement, we have paid Granahan McCourt Capital, LLC a fee of $10,000
per month for providing us with administrative services. Other than the fees
payable to Granahan McCourt Capital, LLC pursuant to the agreement described
above, no compensation of any kind, including finder’s, consulting fees or other
similar compensation, will be paid by us or any other entity to any of our
existing officers, directors, initial stockholders or any of their respective
affiliates, prior to or in connection with a business combination. However, such
individuals and entities 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. 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. Because of the foregoing, we will generally not have the benefit of
independent directors examining the propriety of expenses incurred on our behalf
and subject to reimbursement. In addition, Mr. McCourt may, in his sole
discretion, transfer our securities held by him to our existing officers and
directors who participate in the deal sourcing, due diligence, structuring and
negotiating of a business combination. The compensation of our Chief Executive
Officer and other officers will be determined by a majority of our independent
directors in accordance with Section 805 of the American Stock Exchange
Company Guide.
 
 28
 Compensation
Committee Interlocks and Insider Participation
 
 Our board
of directors has not established a compensation committee of the board of
directors.  The compensation of our Chief Executive Officer and other
officers will be determined by a majority of our independent directors in
accordance with Section 805 of the American Stock Exchange Company
Guide.
 
 No
members of our board of directors has a relationship that would constitute an
interlocking relationship with executive officers or directors of the company or
another entity.
 
 Compensation
Committee Report
 
 Our board
of directors has not established a compensation committee of the board of
directors. The
compensation of our Chief Executive Officer and other officers will be
determined by a majority of our independent directors in accordance with Section
805 of the American Stock Exchange Company Guide.
 
 Our board
of directors has reviewed and discussed the discussion and analysis of our
compensation which appears above with management, and, based on such review and
discussion, the board of directors determined that the above disclosure be
included in this Annual Report on Form 10-K.
 
 The
independent members of our board of directors are:
 
 Barry
S. Sternlicht
 George
J. Tenet
 Roger
L. Werner, Jr.
 Paul
N. D’Addario
   ITEM 12. SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS
 The
following table sets forth certain information regarding beneficial ownership of
our common stock as of March 17, 2008, by each person who is known by us to
own beneficially more than 5% of the outstanding shares of common
stock.
  Name of Beneficial Owner(1)
              
              Amount of
                Beneficial
                Ownership
                of
      Common
                Stock
              
              Percent of
                Common
                Stock(2)5%
      StockholdersDavid
      C. McCourt(3)
              
              2,574,900
              
              
              18.3
              %HBK
      Investments LP(4)
              
              1,379,400
              
              
              9.8
              %Fir
      Tree, Inc.(6)
              
              1,378,400
              
              
              9.8
              %QVT
      Financial LP(5)
              
              1,278,450
              
              
              9.1
              %Sapling,
      LLC(6)
              
              1,174,102
              
              
              8.3
              %
  
  (1)
                Except
      as set forth in the footnotes to this table, the persons named in the
      table above have sole voting and dispositive power with respect to all
      shares shown as beneficially owned by
them.
 
 (2)
                Amount
      and applicable percentage of ownership is based on 14,062,500 shares of
      our common stock outstanding on March 14,
2008.
 
 (3)
                The
      business address of David C. McCourt is 179 Stony Brook Road, Hopewell,
      NJ 08525.
 
 (4)
                The
      business address of HBK Investments LP is 300 Crescent Court, Suite 700,
      Dallas, Texas 75201.
 
 (5)
                The
      business address of QVT Financial LP, QVT Financial GP LLC, and QVT
      Associates GP LLC is 1177 Avenue of the Americas, 9th
      Floor, New York, NY 10036.  QVT Financial LP (“QVT Financial”)
      is the investment manager for QVT Fund LP (the “Fund”), which beneficially
      owns 1,144,189 shares of Common Stock, and for Quintessence Fund L.P.
      (“Quintessence”), which beneficially owns 125,085 shares of Common Stock.
      QVT Financial is also the investment manager for a separate discretionary
      account managed for Deutsche Bank AG (the “Separate Account”), which holds
      9,176 shares of Common Stock. QVT Financial has the power to direct the
      vote and disposition of the Common Stock held by the Fund, Quintessence
      and the Separate Account. Accordingly, QVT Financial may be deemed to be
      the beneficial owner of an aggregate amount of 1,278,450 shares of Common
      Stock, consisting of the shares owned by the Fund and Quintessence and the
      shares held in the Separate Account. QVT Financial GP LLC, as General
      Partner of QVT Financial, may be deemed to beneficially own the same
      number of shares of Common Stock reported by QVT Financial. QVT Associates
      GP LLC, as General Partner of the Fund and Quintessence, may be deemed to
      beneficially own the aggregate number of shares of Common Stock owned by
      the Fund and Quintessence, and accordingly, QVT Associates GP LLC may be
      deemed to be the beneficial owner of an aggregate amount of 1,269,274
      shares of Common Stock.  The foregoing information was derived
      from a Schedule 13G filed with the SEC on January 30,
      2008.
 
 29
  (6)
                The
      business address of Sapling, LLC and Fir Tree, Inc. is 505 Fifth Avenue,
      New York, New York 10017.  Fir Tree, Inc. is the investment
      manager for each of Sapling, LLC and Fir Tree Recovery Master Fund, L.P.
      and has been granted investment discretion over portfolio investments held
      by each of them.  Sapling, LLC and Fir Tree Recovery Master Fund,
      L.P. are the beneficial owners of 1,174,102 shares of Common Stock and
      204,298 shares of our common stock, respectively. Fir Tree, Inc. may be
      deemed to beneficially own the shares of our common stock held by Sapling,
      LLC and Fir Tree Recovery Master Fund, L.P. as a result of being the
      investment manager of Sapling, LLC and Fir Tree Recovery Master Fund,
      L.P.  Sapling, LLC and Fir Tree Recovery Master Fund, L.P. are the
      beneficial owners of 8.3% and 1.5%, respectively, of the outstanding
      shares of our common stock. Collectively, Sapling, LLC and Fir Tree
      Recovery Master Fund, L.P. beneficially own 1,378,400 shares of common
      stock of the Company, which represent 9.8% of the shares of common stock
      outstanding.  Sapling, LLC may direct the vote and disposition of
      1,174,102 shares of our common stock. Fir Tree Recovery Master Fund, L.P.
      may direct the vote and disposition of 204,298 shares of our common
      stock.  Fir Tree, Inc. has been granted investment discretion over
      the shares of our common stock held by Sapling, LLC and Fir Tree Recovery
      Master Fund, L.P. The foregoing information was derived from a
      Schedule 13G filed with the SEC on February 14,
      2008.
 
 The
following table sets forth certain information regarding beneficial ownership of
our common stock and warrants as of March 14, 2008, by (i) each of our
executive officers for the fiscal year ended December 31, 2007,
(ii) each of our directors, and (iii) all directors and executive
officers as a group. Our warrants become exercisable on the later of the
completion of our initial business combination and October 18, 2007. These
warrants expire on October 18, 2010, or earlier upon redemption.
  Name of Beneficial Owner(1)
              
              Amount of
                Beneficial
                Ownership of
                Common Stock(1)
              
              Percent of
                Common
                StockExecutive
      OfficersDavid
      C. McCourt(2)
              
              2,574,900
              
              18.3
      %Barak
      Bar-Cohen(2)
              
              72,000
              
              *Patrick
      Tangney(2)
              
              0
              
              *Ellyn
      M. Ito(2)
              
              36,000
              
              *DirectorsBarry
      S. Sternlicht(3)
              
              32,400
              
              *George
      J. Tenet(4)
              
              32,400
              
              *Paul
      N. D’Addario(5)
              
              32,400
              
              *Roger
      L. Werner, Jr.(6)
              
              32,400
              
              *All
      executive officers and directors as a group
              
              2,812,500
              
              20.0
      %
 
 
 *
Less than 1.0%
 
 (1)
                All
      ownership is direct beneficial
ownership.
 
 (2)
                Business
      address is 179 Stony Brook Road, Hopewell,
  NJ 08525.
 
 (3)
                Business
      address is 591 W. Putnam Ave., Greenwich,
    CT 06830.
 
 (4)
                Business
      address is School of Foreign Service, Georgetown University, ICC
      Building, Washington,
D.C. 20057.
 
 (5)
                Business
      address is 11766 Wilshire Blvd., Ste. 890, Los Angeles,
      CA 90025.
 
 (6)
                Business
      address is 10 Barnstable Lane, Greenwich,
    CT 06830.
 
 30
 ITEM 13.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
 
 Certain
Relationships and Related Transactions
 
 Prior to
our initial public offering, we privately sold to our officers and directors
3,234,375 shares of our common stock for $2,000 in cash, at a price of $0.000618
per share. In connection with out initial public offering, we also sold to
Mr. McCourt, our President, CEO and Chairman, in a private placement
concurrently with the initial public offering 4,000,000 warrants for
$4,000,000 in cash, at a price of $1.00 per warrant.
 
 The
holders of the majority of the shares and warrants sold to our initial
stockholders prior to our initial public offering (including the warrants, and
the shares underlying the warrants, purchased in the private placement) are
entitled to make up to two demands that we register these shares, warrants and
the shares of common stock underlying such warrants pursuant to an agreement
dated October 18, 2006. The holders of the majority of these securities can
elect to exercise these registration rights at any time commencing 90 days
prior to the date upon which they will first become eligible for resale. In
addition, these security holders have certain “piggy-back” registration rights
with respect to registration statements filed subsequent to the date they become
eligible for resale. We will bear the expenses incurred in connection with the
filing of any of these registration statements.
 
 The
payment to Granahan McCourt Capital, LLC of a monthly fee of $10,000 is for
certain administrative services, including office space, utilities and
secretarial support. David C. McCourt is the Chairman and CEO of Granahan
McCourt Capital, LLC and, as a result, will benefit from the transaction with
Granahan McCourt Capital, LLC. However, this arrangement is solely for our
benefit and is not intended to provide Mr. McCourt compensation in lieu of
a salary.
 
 We will
reimburse our officers and directors, subject to board approval, 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 acquisitions and business combinations. There is no limit on the amount
of 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.
 
 Other
than the $10,000 per month administrative fee payable to Granahan McCourt
Capital, LLC and reimbursable out-of-pocket expenses payable to our officers and
directors, no compensation or fees of any kind, including finder’s and
consulting fees, will be paid to any of our initial stockholders, officers or
directors who owned our common stock prior to our initial public offering, or to
any of their respective affiliates or family members for services rendered to us
prior to or with respect to the initial transaction. However, Mr. McCourt
may, in his sole discretion, transfer our securities held by him to our existing
officers and directors who participate in the deal sourcing, due diligence,
structuring and negotiating of a business combination.
 
 David C.
McCourt advanced a total of $218,000 in exchange for a promissory note from us.
The promissory note was repaid upon consummation of the initial public
offering.  Mr. McCourt loaned an additional $250,000 to us on March
14, 2008,in exchange for a promissory note from us in such
amount.  The principal balance of this note is payable on the earlier
of (a) one business day following Mr. McCourt’s written demand for payment and
(b) upon consummation of a business combination.  The promissory note
bears no interest and has no recourse against the funds in the trust
account.
 
 Since the
underwriters’ over-allotment option was not exercised, on January 16, 2007 we
repurchased 421,875 shares of our common stock from David C. McCourt for
$261.
 
 All
ongoing and future transactions between us and any of our officers and directors
or their respective affiliates, including loans by our officers and directors,
will be on terms believed by us to be no less favorable than are available from
unaffiliated third parties. Such transactions or loans, including any
forgiveness of loans, will require prior approval 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.
 
 None of
our directors or officers, nor any of their associated persons have any direct
or indirect affiliation or association with a member of the National Association
of Securities Dealers, Inc.
 
 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 us as well as the other entities with
      which they are affiliated. Our officers and directors may have conflicts
      of interest in determining to which entity a particular business
      opportunity should be presented.
 
 31
 ·
                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.  One of our
      directors, Barry S. Sternlicht, is currently the Chairman and Chief
      Executive Officer of Third Wave Acquisition Corp,  a blank check
      company, which is in registration with the SEC.  Some of our
      officers and directors are affiliated with entities in the
      telecommunications and media industries. David C. McCourt, our
      President, Chief Executive Officer and Chairman, is the Chairman and
      interim Chief Executive Officer and Chief Operating Officer of
      Narrowstep, Inc., a company that provides television services over
      the internet, and Roger L. Werner, Jr., one of our directors, is
      Chairman of Werner Telesport, LLC, a sports programming and
      production company, and serves as a director of Narrowstep, Inc. and
      WATV Productions, an event and television production company. In addition
      Paul N. D’Addario is the founder and Senior Managing Director of
      Palisades Ventures, a technology and media growth
  fund.
 
 ·
                Our
      officers and directors own 2,812,500 shares of our common stock, and our
      sponsor, Mr. McCourt, purchased 4,000,000 warrants in a private
      placement prior to the consummation of our initial public offering. Except
      under limited circumstances, these securities are transferable only if a
      business combination is successfully completed and will be worthless if a
      business combination is not consummated. Consequently, our officers and
      directors may have a conflict of interest in determining whether a
      particular target acquisition is appropriate to effect a business
      combination. Additionally, certain members of management may enter into
      consulting or employment agreements with us as part of a business
      combination, pursuant to which they may be entitled to compensation for
      their services. The personal and financial interests of our directors and
      officers may influence their motivation in identifying and selecting a
      target acquisition, timely completing a business combination and securing
      the release of their stock.
 
 ·
                Other
      than with respect to our initial business combination, we have not adopted
      a policy that expressly prohibits our officers and directors from having a
      direct or indirect pecuniary interest in any investment to be acquired or
      disposed of by us or in any transaction to which we are a party or have an
      interest. Nor do we have a policy that expressly prohibits any such
      persons from engaging for their own account in business activities of the
      types conducted by us. Accordingly, such parties may have an interest in
      certain transactions in which we are involved, and may also compete with
      us.
  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 dissolution and liquidation or such time
as he or she ceases to be an officer or director, to present to us 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 and contractual obligations
he or she might have.
 
 As each
of our officers and directors is currently involved in other business
enterprises, each has certain pre-existing fiduciary and contractual obligations
to other entities that may cause him to have conflicts of interest in
determining to which entity he presents a specific business opportunity. To the
extent that one of our officers or directors identifies a business opportunity
that may be suitable for an entity that he or she has a pre-existing fiduciary
or contractual obligation to, he or she may honor his pre-existing fiduciary or
contractual obligation to this entity. Accordingly, consistent with our code of
ethics, he or she may not present opportunities to us that otherwise may be
attractive to such entity unless such entity has declined to accept such
opportunities.
 
 In
connection with the vote required for any business combination, all of our
initial stockholders, including all of our officers and directors, have agreed
to vote their respective shares of common stock owned by them immediately prior
to our initial public offering in accordance with the vote of a 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
distribution with respect to the shares of common stock acquired by them prior
to such offering. An initial stockholder who acquires shares in or after our
initial public offering, however, would be a public stockholder with respect to
these shares and retains the right to participate in any liquidation
distribution with respect to such shares.
 
 To
further minimize potential conflicts of interest, we have agreed that we will
not consummate a business combination with any of our initial stockholders,
including our officers and directors, or any of their respective affiliates
without first obtaining an opinion from an independent investment banking firm
regarding the fairness to our stockholders from a financial point of view of the
business combination.
 
 32
 
 ITEM 14.
PRINCIPAL ACCOUNTANT FEES AND SERVICES
 
 Audit
and Non-Audit Fees
 
 The
following table sets forth the fees billed or anticipated for the periods
indicated for professional services rendered by Pressman Ciocca Smith LLP, our
independent registered public accounting firm.
  Fiscal Year Ended
                December 31, 2007
              
              Fiscal Year Ended
                December 31, 2006Audit
      Fees(1)
              
              $
              46,801
              
              77,032Audit-Related
      Fees(2)
              
              $
              27,795
              
              —Tax
      Fees(3)
              
              $
              11,344
              
              11,774All
      Other Fees
              
              $
              —
              
              —Total
              
              $
              85,940
              
              88,806
 
 
 
 
 
 (1)
                Audit
      fees related to professional services rendered in connection with the
      audit of our financial statements for fiscal year 2007 estimated to be
      $20,000, and for the quarterly review of financial statements included in
      our quarterly reports on Form 10-Q for the quarterly periods ended March
      31, 2007, June 30, 2007 and September 30, 2007, estimated to be
      $26,801.
 
 (2)
                Audit-related
      fees for due diligence services incurred in connection with a
      potential acquisition.
 
 (3)
                Tax
      fees relate to professional services rendered for tax compliance, tax
      advice and tax planning.
 
 Approval
of Independent Registered Public Accounting Firm Services and
Fees
 
 The Audit
Committee is responsible for appointing, setting compensation, and overseeing
the work of the independent auditor. In recognition of this responsibility, the
Audit Committee has established a policy to pre-approve all audit and
permissible non-audit services provided by the independent auditor.
 
 In
addition to retaining Pressman Ciocca Smith LLP to audit our financial
statements for fiscal year 2007, we may retain Pressman Ciocca Smith LLP to
provide advisory services and due diligence work in connection with prospective
business combinations to us in our 2008 fiscal year. We understand the need for
Pressman Ciocca Smith LLP to maintain objectivity and independence in its audit
of our financial statements.
 
 
 33
 PART
IV
 
 ITEM 15.  EXHIBITS AND FINANCIAL STATEMENT
SCHEDULES
 
 (a)(1)
Financial Statements
 
 See
financial statements commencing on page F-1 hereof.
 
 (a)(2)
Financial Statement Schedules
 
 No
financial statement schedules are filed herewith because (i) such schedules
are not required or (ii) the information required has been presented in the
aforementioned financial statements.
 
 (a)(3)
Exhibits
 
 Exhibits
marked with an asterisk (*) are incorporated by reference to documents
previously filed by us with the SEC, as exhibits to our registration statement
on Form S-1 (File No. 333-136048). All other documents listed are filed
with this report.
 
 EXHIBIT
INDEX
  Exhibit
      No.
              
              Description*3.1
              
              Form
      of Fourth Amended and Restated Certificate of Incorporation of the
      Registrant*3.2
              
              By-laws
      of the Registrant*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*10.1
              
              Subscription
      Agreement, dated July 20, 2006 between the Registrant and
      David C. McCourt*10.2
              
              Subscription
      Agreement, dated July 20, 2006 between the Registrant and
      Barry S. Sternlicht*10.3
              
              Subscription
      Agreement, dated July 20, 2006 between the Registrant and
      George J. Tenet*10.4
              
              Subscription
      Agreement, dated July 20, 2006 between the Registrant and
      Roger L. Werner, Jr.*10.5
              
              Subscription
      Agreement, dated July 20, 2006 between the Registrant and
      Paul N. D’Addario*10.6
              
              Subscription
      Agreement, dated July 20, 2006 between the Registrant and Barak
      Bar-Cohen*10.7
              
              Subscription
      Agreement, dated July 20, 2006 between the Registrant and
      Ellyn M. Ito*10.8
              
              Form
      of Investment Management Trust Agreement between the Registrant and
      Continental Stock Transfer & Trust Company*10.9
              
              Administrative
      Services Letter Agreement, dated July 24, 2006 between the Registrant
      and Granahan McCourt Capital, LLC.*10.10
              
              Promissory
      Note, dated July 17, 2006, in the principal amount of $218,000 issued by
      the Registrant to David C. McCourt*10.11
              
              Form
      of Registration Rights Agreement between the Registrant and the initial
      stockholders*10.12
              
              Second
      Amended and Restated Placement Warrant Purchase Agreement between the
      Registrant and David C. McCourt*10.13
              
              Form
      of Letter Agreement between each Insider, the Registrant and Deutsche Bank
      Securities Inc.*14
              
              Code
      of Ethics24
              
              Power
      of Attorney (contained in signature page)31.1
              
              Certificate
      Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 of
      the Principal Executive Officer31.2
              
              Certificate
      Pursuant to Rule 13a-14(a) under Securities Exchange Act of 1934 of the
      Principal Financial Officer32.1
              
              Certificate
      Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002 of the Principal Executive
      Officer32.2
              
              Certificate
      Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of
      the Sarbanes-Oxley Act of 2002 of the Principal Financial
      Officer
 
 34
 SIGNATURES
 
 Pursuant
to the requirements of Section 13 or Section 15(d) of the Securities
Exchange Act of 1934, this Registrant has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.
  GRANAHAN
      MCCOURT ACQUISITION CORPORATIONBy:
              /s/
      David C. McCourtName:
              David
      C. McCourtTitle:
              President,
      Chief Executive Officer and
Chairman
 
 Date:
March 17, 2008
 
 
 
 35
 
 
 POWER
OF ATTORNEY AND SIGNATURES
 
 Each of
the undersigned officers and directors of Granahan McCourt Acquisition
Corporation hereby severally constitute and appoint David C. McCourt, our true
and lawful attorney, with full power to him, to sign for us in our names in the
capacities indicated below, all amendments to this Annual Report on Form 10-K,
and generally to do all things in our names and on our behalf in such capacities
to enable Granahan McCourt Acquisition Corporation to comply with the provisions
of the Securities Exchange Act of 1934, as amended, and all requirements of the
Securities and Exchange Commission.
 
 Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the registrant and in the
capacities indicated on this 17th day of March, 2008.
  Name
              
              Capacity/s/
      David C. McCourtDavid
      C. McCourt
              
              President,
      CEO and Chairman of the Board (principal executive
  officer)/s/
      Barak Bar-CohenBarak
      Bar-Cohen
              
              Treasurer
      and CFO (principal financial and accounting officer)/s/
      Barry S. SternlichtBarry
      S. Sternlicht
              
              Director/s/
      George J. TenetGeorge
      J. Tenet
              
              Director/s/
      Paul N. D’AddarioPaul
      N. D’Addario
              
              Director/s/
      Roger L. Werner, Jr.Roger
      L. Werner, Jr.
              
              Director
 
  
 36
 
 FINANCIAL
STATEMENTS
 Granahan
McCourt Acquisition Corporation
 (A
Development Stage Company)
 Index
of Financial Statements
  PageReport
      of Management on Internal Control Over Financial Reporting
              
              F-2Reports of Independent Registered Public
      Accounting Firm
              
              F-3Financial
      StatementsBalance Sheets
              
              F-5Statements of Operations
              
              F-6Statements of Stockholders’
      Equity
              
              F-7Statements of Cash Flows
              
              F-8Notes to Financial
    Statements
              
              F-9
 
  
  F-1
 Management’s
Report on Internal Control over Financial Reporting
  Management
of Granahan McCourt Acquisition Corporation (the “Company”) is responsible for
establishing and maintaining adequate internal control over financial reporting
as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. The
Company’s internal control over financial reporting is a process designed under
the supervision of the Company’s chief executive and chief financial officers to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of the Company’s consolidated financial statements for
external purposes in accordance with the U.S. generally accepted accounting
principles. The Company’s internal control over financial reporting includes
policies and procedures that:
  (i) pertain
to the maintenance of records that, in reasonable detail, accurately and fairly
reflect transactions and dispositions of assets of the Company;
  (ii) provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with U.S. generally
accepted accounting principles, and that receipts and expenditures are being
made only in accordance with authorizations of management and the directors of
the Company; and
  (iii) provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of the Company’s assets that could have a
material effect on the Company’s financial statements.
  Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect all misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may become
inadequate due to changes in conditions, or that the degree of compliance with
the policies or procedures may deteriorate.
  As of
December 31, 2007, management assessed the effectiveness of the Company’s
internal control over financial reporting based on the framework established
inInternal Control —
Integrated Framework  issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Based on this assessment,
management determined that the Company’s internal control over financial
reporting as of December 31, 2007 is effective.
  The
effectiveness of the Company’s internal control over financial reporting as of
December 31, 2007, has been audited by Pressman, Ciocca, Smith LLP an
independent registered public accounting firm, as stated in their report
appearing on page F-4.
 
  March 17,
2008
     /s/
      David C.
      McCourt
                  /s/
      Barak
      Bar-CohenName:  David C.
      McCourt
                    Title:  Principal Executive Officer
                  Name:  Barak
      Bar-Cohen
                    Title:  Principal Financial
  Officer
  F-2
  Report
of Independent Registered Public Accounting Firm
 
 To The
Board of Directors and Stockholders
 Granahan
McCourt Acquisition Corporation
 
 We have
audited the accompanying balance sheets of Granahan McCourt Acquisition
Corporation (a development stage company) (the “Company”) as of December 31,
2007 and 2006 and the related statements of operations, stockholders’ equity and
cash flows for the year ended December 31, 2007 and for the periods from July
10, 2006 (inception) through December 31, 2006 and July 10, 2006 (inception)
through December 31, 2007.  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 audits 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 financial position of Granahan McCourt Acquisition
Corporation as of December 31, 2007 and 2006  and the results of its
operations and its cash flows for the year ended December 31, 2007 and for the
periods from July 10, 2006 (inception) through December 31, 2006 and July 10,
2006 (inception) through December 31, 2007, in conformity with accounting
principles generally accepted in the United States of America.
 
 The
accompanying financial statements have been prepared assuming that the Company
will continue as a going concern.  As discussed in Note A to the
financial statements, in the event 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, the proceeds held in the Trust Account will be
distributed.  This condition raises substantial doubt about the
Company’s ability to continue as a going concern.  Management’s plans
regarding those matters also are described in Note A.  The financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.
 
 We also
have audited, in accordance with the standards of the Public Company Accounting
Oversight Board (United States), the effectiveness of the Company’s internal
control over financial reporting as of December 31, 2007, based on criteria
established in Internal
Control – Integrated Framework issued by Committee of Sponsoring
Organizations of the Treadway Commission (COSO) and our report dated March 17,
2008, expressed an unqualified opinion thereon.
 
 
 
 
 /s/
Pressman Ciocca Smith LLP
 
 Huntingdon
Valley, Pennsylvania
 March
17, 2008
 F-3
 Report
of Independent Registered Public Accounting Firm
 
 To the
Board of Directors and Stockholders
 Granahan
McCourt Acquisition Corporation
 
 We have
audited Granahan McCourt Acquisition Corporation’s internal control over
financial reporting as of December, 31, 2007, based on criteria established in
Internal Control—Integrated
Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO).  Granahan McCourt Acquisition
Corporation’s management is responsible for maintaining effective internal
control over financial reporting and for its assessment of the effectiveness of
internal control over financial reporting included in the accompanying
Management's Annual Report on Internal Control Over Financial
Reporting.  Our responsibility is to express an opinion on the
Company’s internal control over financial reporting based on our
audit.
 
 We
conducted our audit 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
effective internal control over financial reporting was maintained in all
material respects.  Our audit of internal control over financial
reporting included obtaining an understanding of internal control over financial
reporting, assessing the risk that a material weakness exists, and testing and
evaluating the design and operating effectiveness of internal control based on
the assessed risk.  Our audit also included performing such other
procedures as we considered necessary in the circumstances.  We
believe that our audit provides a reasonable basis for our opinion.
 
 A
company’s internal control over financial reporting is a process designed to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles.  A company’s internal
control over financial reporting includes those policies and procedures that (1)
pertain to the maintenance of records that, in reasonable detail, accurately and
fairly reflect the transactions and dispositions of the assets of the company;
(2) provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted
accounting principles, and that receipts and expenditures of the company are
being made only in accordance with authorizations of management and directors of
the company; and (3) provide reasonable assurance regarding prevention or timely
detection of unauthorized acquisition, use, or disposition of the company’s
assets that could have a material effect on the financial
statements.
 
 Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements.  Also, projections of any evaluation
of effectiveness to future periods are subject to the risk that controls may
become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.
 
 In our
opinion, Granahan McCourt Acquisition Corporation maintained, in all material
respects, effective internal control over financial reporting as of December 31,
2007, based on criteria established in Internal Control—Integrated
Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO).
 
 We have
also audited, in accordance with the standards of the Public Company Accounting
Oversight Board (United States), the balance sheets and the related statements
of operations, stockholders’ equity and cash flows of Granahan McCourt
Acquisition Corporation, and our report dated March 17, 2008 expressed an
unqualified opinion.
 
 
 /s/
Pressman Ciocca Smith LLP
 
 Huntingdon
Valley, Pennsylvania
 March 17,
2008
  F-4
 Granahan
McCourt Acquisition Corporation
 (A
Development Stage Company)
 Balance
Sheets
  December
      31,
                
                
                December
      31,2007
                
                
                2006ASSETSCurrent
      AssetsCash
      and cash equivalents
                
                $
                306,180
                
                
                $
                1,662,056Cash
      and cash equivalents in trust account
                
                
                91,862,529
                
                
                
                88,909,820Accrued
      interest receivable in trust account
                
                
                233,371
                
                
                
                260,294Accrued
      interest receivable-other
                
                
                1,381
                
                
                
                4,622Prepaid
      expenses
                
                
                100,650
                
                
                
                202,311Prepaid
      taxes
                
                
                91,000
                
                
                
                21,000Total
      current assets
                
                
                92,595,111
                
                
                
                91,060,103Property
      and equipment, net of accumulated depreciation of $2,877
                
                
                5,755
                
                
                
                -Deferred
      tax asset, net
                
                
                741,600
                
                
                
                86,600TOTAL
      ASSETS
                
                $
                93,342,466
                
                
                $
                91,146,703LIABILITIES
      & STOCKHOLDERS' EQUITYCurrent
      liabilitiesAccounts
      payable and accrued expenses
                
                $
                312,038
                
                
                $
                59,728Franchise
      tax payable
                
                
                103,949
                
                
                
                75,659Deferred
      underwriting fees
                
                
                3,600,000
                
                
                
                3,600,000Total
      current liabilities
                
                
                4,015,987
                
                
                
                3,735,387Common
      stock, subject to possible conversion, 2,249,999 shares at conversion
      value
                
                
                18,405,423
                
                
                
                17,834,249Commitments
      and contingenciesStockholders'
      equityPreferred
      Stock, $0.0001 par value; authorized, 5,000 shares; no shares issued or
      outstanding
                
                
                -
                
                
                
                -Common
      Stock, $0.0001 par value, authorized, 100,000,000 shares, 14,062,500
      shares issued and outstanding as of December 31, 2007 and 14,484,375
      shares issued and outstanding as of December 31, 2006 (which includes
      2,249,999 shares subject to possible conversion)
                
                
                1,406
                
                
                
                1,448Additional
      paid- in capital
                
                
                68,587,925
                
                
                
                69,159,318Retained
      earnings accumulated during the development stage
                
                
                2,331,725
                
                
                
                416,301Total
      stockholders' equity
                
                
                70,921,056
                
                
                
                69,577,067TOTAL
      LIABILITIES  AND STOCKHOLDERS' EQUITY
                
                $
                93,342,466
                
                
                $
                91,146,703
  See
accompanying notes.
 
 F-5
  Granahan
McCourt Acquisition Corporation
 (A
Development Stage Company)
 Statements
of Operations
  For
      the year ended
                  December
      31, 2007
                
                
                July
      10, 2006
                  (date
      of inception)
                  to
      December 31,
                  2006
                
                
                July
      10, 2006
                  (date
      of inception)
                  to
      December 31,
                  2007Interest
      income
                
                $
                3,185,656
                
                
                $
                587,219
                
                
                $
                3,772,875General
      and administrative expenses
                
                
                1,770,232
                
                
                
                223,518
                
                
                
                1,993,750Income
      before income taxes
                
                
                1,415,424
                
                
                
                363,701
                
                
                
                1,779,125Income
      tax (benefit)
                
                
                (500,000
                )
                
                
                (52,600
                )
                
                
                (552,600
                )Net
      income
                
                
                1,915,424
                
                
                
                416,301
                
                
                
                2,331,725Accretion
      of trust account relating to common stock subject to possible
      conversion
                
                
                (571,174
                )
                
                
                (104,257
                )
                
                
                (675,431
                )Net
      income attributable to common stockholders
                
                $
                1,344,250
                
                
                $
                312,044
                
                
                $
                1,656,294Weighted-average
      common shares outstanding subject to possible conversion
                
                
                2,249,999
                
                
                
                892,241
                
                
                
                1,811,688Basic
      and diluted net income per share subject to possible
      conversion
                
                $
                0.25
                
                
                $
                0.05
                
                
                $
                0.37Weighted-average
      number of shares outstanding - basic and diluted
                
                
                11,829,838
                
                
                
                6,803,341
                
                
                
                10,207,184Basic
      and diluted net income per share
                
                $
                0.11
                
                
                $
                0.05
                
                
                $
                0.16
 
  See
accompanying notes.
 
 F-6
  Granahan
McCourt Acquisition Corporation
 (A
Development Stage Company)
 Statements
of Stockholders’ Equity
  RetainedEarningsAccumulatedAdditional
                
                
                During
      the
                
                
                TotalCommon
      Stock
                
                
                Paid-in
                
                
                Development
                
                
                Stockholders'Shares
                
                
                Amount
                
                
                Capital
                
                
                Stage
                
                
                EquityJuly
      10, 2006 (Inception) to December 31, 2007Issuance
      of common stock to initial stockholders
                
                
                3,234,375
                
                
                $
                323
                
                
                $
                1,677
                
                
                $
                -
                
                
                $
                2,000Issuance
      of warrants in private placement
                
                
                -
                
                
                
                -
                
                
                
                4,000,000
                
                
                
                -
                
                
                
                4,000,000Sale
      of 11,250,000 units, net of underwriters' discount and offering
      expenses
                
                
                11,250,000
                
                
                
                1,125
                
                
                
                82,991,890
                
                
                
                -
                
                
                
                82,993,015Net
      proceeds subject to possible conversion of 2,249,999
shares
                
                
                -
                
                
                
                -
                
                
                
                (17,729,992
                )
                
                
                -
                
                
                
                (17,729,992
                )Accretion
      of trust fund relating to common stock subject to possible
      conversion
                
                
                -
                
                
                
                -
                
                
                
                (104,257
                )
                
                
                -
                
                
                
                (104,257
                )Net
      income for the period July 10, 2006 (inception) to December 31,
      2006
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                416,301
                
                
                
                416,301Balance,
      December 31, 2006
                
                
                14,484,375
                
                
                $
                1,448
                
                
                $
                69,159,318
                
                
                $
                416,301
                
                
                $
                69,577,067Repurchase
      of 421,875 shares of common stock from initial
stockholders
                
                
                (421,875
                )
                
                
                (42
                )
                
                
                (219
                )
                
                
                -
                
                
                
                (261
                )Accretion
      of trust fund relating to common stock subject to possible
      conversion
                
                
                -
                
                
                
                -
                
                
                
                (571,174
                )
                
                
                -
                
                
                
                (571,174
                )Net
      income for the year ended December 31, 2007
                
                
                -
                
                
                
                -
                
                
                
                -
                
                
                
                1,915,424
                
                
                
                1,915,424Balance,
      December 31, 2007
                
                
                14,062,500
                
                
                $
                1,406
                
                
                $
                68,587,925
                
                
                $
                2,331,725
                
                
                $
                70,921,056
 
 See
accompanying notes.
 
 F-7
  Granahan
McCourt Acquisition Corporation
 (A
Development Stage Company)
 Statements
of Cash Flows
  For
      the year ended
                  December
      31,
                  2007
                
                
                July
      10, 2006
                  (date
      of inception)
                  to
      December 31,
                  2006
                
                
                July
      10, 2006
                  (date
      of inception)
                  to
      December 31,
                  2007Cash
      flows from operating activities:Net
      income
                
                $
                1,915,424
                
                
                $
                416,301
                
                
                $
                2,331,725Adjustments
      to reconcile net income to net cash (used in) operating
      activities:Depreciation
                
                
                2,877
                
                
                
                -
                
                
                
                2,877Interest
      earned on cash held in trust
                
                
                (3,150,786
                )
                
                
                (575,114
                )
                
                
                (3,725,900
                )Deferred
      tax
                
                
                (655,000
                )
                
                
                (86,600
                )
                
                
                (741,600
                )Changes
      in operating assets and liabilities:Accrued
      interest receivable-other
                
                
                3,241
                
                
                
                (4,622
                )
                
                
                (1,381
                )Prepaid
      expenses
                
                
                101,661
                
                
                
                (202,311
                )
                
                
                (100,650
                )Prepaid
      taxes
                
                
                (70,000
                )
                
                
                (21,000
                )
                
                
                (91,000
                )Accounts
      payable and accrued expenses
                
                
                252,310
                
                
                
                59,728
                
                
                
                312,038Franchise
      tax payable
                
                
                28,290
                
                
                
                75,659
                
                
                
                103,949Net
      cash (used in) operating activities
                
                
                (1,571,983
                )
                
                
                (337,959
                )
                
                
                (1,909,942
                )Cash
      flows from investing activities:Cash
      and cash equivalents deposited in trust account
                
                
                -
                
                
                
                (88,650,000
                )
                
                
                (88,650,000
                )Cash
      withdrawn from trust for income tax payment
                
                
                225,000
                
                
                
                55,000
                
                
                
                280,000Purchase
      of property and equipment
                
                
                (8,632
                )
                
                
                -
                
                
                
                (8,632
                )Net
      cash provided by (used in) investing activities
                
                
                216,368
                
                
                
                (88,595,000
                )
                
                
                (88,378,632
                )Cash
      flows from financing activities:Proceeds
      from offering, net
                
                
                -
                
                
                
                86,593,015
                
                
                
                86,593,015Proceeds
      from note payable to stockholder
                
                
                -
                
                
                
                218,000
                
                
                
                218,000Repayment
      of note payable to stockholder
                
                
                -
                
                
                
                (218,000
                )
                
                
                (218,000
                )Proceeds
      from issuance of common stock to initial stockholders
                
                
                -
                
                
                
                2,000
                
                
                
                2,000Repurchase
      of common stock from initial stockholders
                
                
                (261
                )
                
                
                -
                
                
                
                (261
                )Proceeds
      from issuance of warrants
                
                
                -
                
                
                
                4,000,000
                
                
                
                4,000,000Net
      cash provided by (used in) financing activities
                
                
                (261
                )
                
                
                90,595,015
                
                
                
                90,594,754Net
      increase (decrease) in cash and cash equivalents
                
                
                (1,355,876
                )
                
                
                1,662,056
                
                
                
                306,180Cash
      and cash equivalents, beginning
                
                
                1,662,056
                
                
                
                -
                
                
                
                -Cash
      and cash equivalents, ending
                
                $
                306,180
                
                
                $
                1,662,056
                
                
                $
                306,180Supplemental
      disclosure of taxes paid and non-cash investing and financing
      transactionsCash
      paid for income taxes
                
                $
                225,000
                
                
                $
                55,000
                
                
                $
                280,000Accrual
      of deferred underwriting fees
                
                
                -
                
                
                
                3,600,000
                
                
                
                3,600,000Accretion
      of trust fund relating to common stock subject to possible
      conversion
                
                
                571,174
                
                
                
                104,257
                
                
                
                675,431
 
 See
accompanying notes.
  F-8
  Granahan
McCourt Acquisition Corporation
 (A
Development Stage Company)
 Notes
to Financial Statements
 
 
 Note
A—Organization and Business Operations
 
 Granahan
McCourt Acquisition Corporation (the “Company”) was incorporated in Delaware on
July 10, 2006 as a blank check company for the purpose of acquiring, or
acquiring control of, one or more assets or operating businesses in the
telecommunications and media industries through a merger, capital stock
exchange, asset or stock acquisition or other similar business transaction
(“Business Combination”).  As of December 31, 2007, the Company had not
commenced any operations.  All activity through December 31, 2007 relates
to the Company’s formation, the sale of shares of common stock in a private
placement, and the initial public offering (the “Offering”) described
below.  The Company has selected December 31 as its fiscal year
end.
 
 The
registration statement for the Company’s initial public offering was declared
effective on October 18, 2006.  The Company consummated the Offering of
11,250,000 Units (as defined in Note C) on October 24, 2006 for net proceeds of
approximately $83 million.  On October 24, 2006, the Company consummated a
private placement of 4 million warrants (the “Private Placement”) for an
aggregate purchase price of $4 million.
 
 The
Company’s management has broad discretion with respect to the specific
application of the net proceeds of the Offering and the Private Placement,
although substantially all of the net proceeds of the Offering and the Private
Placement are intended to be generally applied toward consummating a Business
Combination.  Furthermore, there is no assurance that the Company will be
able to successfully effect a Business Combination.  Upon the closing of
the Private Placement and the Offering, $88.65 million (including $3.6 million
of underwriters’ fees which have been deferred by the underwriters as described
in Note C) was placed in a trust account (“Trust Account”) and invested in
United States “government securities” within the meaning of Section 2(a)(16) of
the Investment Company Act of 1940 having a maturity 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 until the earlier of (i) the consummation of
its first Business Combination in which the fair market value of the assets or
operating businesses acquired is at least 80% of the balance in the Trust
Account (excluding deferred underwriters’ discount) and (ii) liquidation of the
Company.  The remaining proceeds may be used to pay for business, legal and
accounting due diligence on prospective acquisitions and continuing general and
administrative expenses.
 
 The
Company, after signing a definitive agreement for the acquisition of a target
business, will submit such transaction for stockholder approval.  In the
event that 20% or more of the outstanding stock (excluding, for this purpose,
those shares of common stock issued prior to the Offering) vote against the
Business Combination and exercise their conversion rights described below, the
Business Combination will not be consummated.  Accordingly, Public
Stockholders holding 19.99% of the aggregate number of shares owned by all
Public Stockholders may seek conversion of their shares in the event of a
Business Combination.  Such Public Stockholders are entitled to receive
their per share interest in the Trust Fund computed without regard to the shares
held by initial stockholders.  In this respect, $18,405,423 (including
accretion of $675,431) has been classified as common stock subject to possible
conversion at December 31, 2007.  Public Stockholders who convert their
stock into an allocable share of the Trust Account will still have the right to
exercise the warrants that they received as part of the Units and still
hold.
 
 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,
the proceeds held in the Trust Account will be distributed to the Company’s
public stockholders, excluding the initial stockholders to the extent of their
initial stock holdings.  In the event of such distribution, the per share
value of the residual assets remaining available for distribution (including
Trust Account assets) may be less than the initial public offering price per
share in the Offering (assuming no value is attributed to the Warrants contained
in the Units to be offered in the Offering discussed in Note C).
 
 The
accompanying financial statements have been prepared assuming that Granahan
McCourt Acquisition Corp. will continue as a going concern. The Company’s
Certificate of Incorporation provides for mandatory liquidation of the Company
by October 24, 2008, without stockholder approval, in the event that the Company
does not consummate a business combination within 18 months from the date of
consummation of the Public Offering, or 24 months from the consummation of the
Public Offering if certain extension criteria have been satisfied. The Initial
Stockholders have agreed to waive their rights to participate in any liquidation
distribution occurring upon its failure to consummate a business combination
with respect to those shares of common stock acquired by them prior to the
Public Offering and with respect to the warrants purchased in the private
placement. In addition, the underwriters have agreed to waive their rights to
the $3,600,000 of contingent compensation deposited in the trust account for
their benefit. Accordingly, in the event of liquidation, the public stockholders
will receive $7.88 per share plus interest (net of taxes payable and that
portion of the earned interest previously released to the Company). The Company
will pay the costs of liquidation and dissolution from remaining assets outside
of the trust account. The financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
 
 F-9
 
 Note
B—Summary of Significant Accounting Policies
  Concentration
of Credit Risk
 
 The
Company maintains cash balances at a financial institution.  Accounts
at this institution are insured up to $100,000.  The Company maintains
cash balances in excess of the insured amount.
 Cash and
Cash Equivalents
 
 The
Company considers all marketable debt securities with original maturities of
three months or less to be cash equivalents.
 
 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 and disclosure of contingent assets and liabilities at the date of
the financial statements and reported amounts of revenues and expenses during
the reporting period.  Actual results could differ from those
estimates.
  Property
and Equipment
 
 Property
and equipment are stated at cost.  Depreciation is provided over the
estimated useful lives using the straight-line method.  Expenditures
for renewals and betterments that extend the useful lives of property and
equipment are capitalized.  Expenditures for maintenance and repairs
are charged to expense as incurred.
  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 when realized.
  Recently
Issued Accounting Standards
  In June
2006, the FASB issued Interpretation No. 48, “Accounting for Uncertainty in Income
Taxes-an Interpretation of SFAS No. 109 ” (“FIN 48”). FIN 48 clarifies
the accounting for uncertainty in tax positions recognized in a company's
financial statements in accordance with SFAS No. 109, “Accounting for Income Taxes.
” FIN 48 prescribes a recognition threshold and measurement attribute for the
financial statement recognition and measurement of the tax position taken or
expected to be taken in a tax return. The Company adopted FIN 48 effective
January 1, 2007. The adoption of FIN 48 did not have any impact on the
accompanying financial statements since we have not identified any uncertain tax
positions as defined by FIN 48.
 
 We
recognize interest and penalties related to uncertain tax positions in income
tax expense. The tax years 2007 and 2006 remain open to examination by the major
taxing jurisdictions to which we are subject.
  In
September 2006, the FASB issued SFAS No. 157 “Fair Value Measurements” (“SFAS
157”) which defines fair value, establishes a framework for measuring fair
value, and expands disclosures about fair value measurements.  SFAS
157  applies to other accounting pronouncements that require or permit
fair value measurements.  The new guidance is effective for financial
statements issued for fiscal years beginning after November 15, 2007, and for
interim periods within those fiscal years.  The adoption of SFAS No.
157 is not expected to have a material effect on the Company’s financial
position and results of operations.
 
 In
February 2007, the FASB issued SFAS No.159 “The Fair Value Option for Financial
Assets and Financial Liabilities” which permits entities to choose to measure
many financial instruments and certain other items at fair value that are not
currently required to be measured at fair value. SFAS 159 is effective for the
first quarter of 2008.  The Company is currently evaluating the impact
of SFAS 159.
 
 In
December of 2007, FASB issued SFAS No. 141 (revised 2007) "Business
Combinations" (“SFAS 141 (R)”).  SFAS 141 (R) retains the fundamental
requirements of the original pronouncement requiring that the purchase method be
used for all business combinations, but also provides revised guidance for
recognizing and measuring identifiable assets and goodwill acquired, liabilities
assumed, and any non-controlling interest in the acquiree.  It also
requires the recognition of assets acquired and liabilities assumed arising from
contingencies, the capitalization of in-process research and development at fair
market value, and the expensing of acquisition-related costs as
incurred.  SFAS 141(R) is effective for the fiscal years beginning
after December 15, 2008.  The Company is not currently able to
estimate the impact of the adoption of SFAS 141(R) on the results of operations
if the Company completes acquisition subsequent to its
adoption.
  F-10
 In
December 2007, the FASB issued SFAS No. 160, “Non-controlling Interests in
Consolidated Financial Statements, an Amendment of ARB No. 51” (“FAS
160”).  SFAS 160 requires ownership interests in subsidiaries held by
parties other than the parent, and the amount of consolidated net income, be
clearly identified, labeled and presented in the consolidated financial
statements. It also requires once a subsidiary is deconsolidated, any retained
non-controlling equity investment in the former subsidiary be initially measured
at fair value.  Sufficient disclosures are required to clearly
identify and distinguish between the interests of the parent and the interest of
the non-controlling owners.  It is effective for the fiscal years
beginning after December 15, 2008, and requires retroactive adoption of the
presentation and disclosure requirements for existing minority
interests.  All other requirements are applied
prospectively.  The Company does not expect the adoption of SFAS to
have a material impact on its financial condition or results of
operations.
  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.
  Reclassification
  Certain
2006 amounts have been reclassified to conform with the 2007
presentation.
 Note
C—Offering
  In the
Offering, effective October 24, 2006, the Company sold to the public 11,250,000
units (“Units”).  The underwriters were paid fees equal to 3% of the gross
proceeds of the Offering, or $2,700,000, at the closing of the Offering and have
agreed to defer an additional $3,600,000 of their underwriting fees until the
consummation of a business combination. Upon the consummation of a business
combination, the Company will pay such deferred fees out of the proceeds of the
Offering held in the Trust Account.  The underwriters will not be entitled
to any interest accrued on the deferred fees.  The underwriters have agreed
to forfeit any rights to, or claims against, such proceeds if the Company does
not successfully complete a business combination.
  Each Unit
consists of one share of the Company's common stock, $0.0001 par value, and one
redeemable common stock purchase warrant (each a “Warrant”).  Each Warrant
will entitle the holder to purchase from the Company one share of common stock
at an exercise price of $6.00 commencing on the later of (a) the completion of a
business combination with a target business and (b) October 18, 2007.  The
Warrants will expire on October 18, 2010.  No Warrant may be exercised
unless, at the time of exercise, a post effective amendment to the registration
statement, or a new registration statement, is effective that includes a current
prospectus relating to the common stock issuable upon exercise of the Warrant
and the common stock underlying the Warrant has been registered, qualified or
deemed to be exempt under the securities laws of the state of residence of the
holder of the Warrant.  The Company is not required to net-cash settle any
Warrant if it is unable to maintain a current prospectus.  The Warrants
will be redeemable 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 $11.50 per share for any 20 trading days within a 30
trading day period ending three business days prior to the date on which notice
of redemption is given.  The Company does not need the consent of the
underwriters in order to redeem the outstanding Warrants.
 
 Mr. David
C. McCourt purchased from the Company in a private placement 4,000,000 Warrants,
at a purchase price of $1.00 per Warrant, for an aggregate purchase price of
$4,000,000.  The $4,000,000 proceeds from the private placement were placed
in the Trust Account and are part of the liquidating distribution to the public
stockholders in the event of a liquidation prior to a business
combination.  The Warrants sold in the private placement can be exercised
on a cashless basis.  The Warrants sold in the private placement have terms
and provisions that are otherwise identical to those of the Warrants being sold
in the Offering but the Warrants issued in connection with the private placement
will not be transferable by Mr. McCourt until after the consummation of the
initial business combination, except that Mr. McCourt is permitted to transfer
the Warrants sold in the private placement in certain limited circumstances,
such as by will in the event of his death or to other of the Company's officers
and directors.  However, the transferees receiving such Warrants will be
subject to the same transfer restrictions imposed on Mr. McCourt.  In the
event of liquidation prior to a business combination, the Warrants sold in
the private placement will be worthless.
  Since the
underwriters' over-allotment option was not exercised, on January 16, 2007
the Company repurchased 421,875 shares of common stock from David C. McCourt,
the President, Chief Executive Officer and Chairman of the Company, at a total
aggregate cost of $261.
 F-11
  
 Note
D—Note Payable to Stockholder
 
 The
Company issued a $218,000 unsecured promissory note to one stockholder, David C.
McCourt, on July 17, 2006.  The note was non-interest bearing and was
payable on the earlier of July 17, 2007 and the consummation of the Company’s
Offering.  In conjunction with the close of the Offering on October 24,
2006, the Company repaid the note.
  Note
E—Commitments
 
 Pursuant
to an administrative services agreement, commencing on October 18, 2006, the
effective date of the registration statement for the Offering (See Note C),
through the earlier of the consummation of a business combination or the
liquidation of the Company, the Company pays a fee of $10,000 per month to an
affiliate of Mr. McCourt for certain administrative services, including office
space, utilities and secretarial support.
 
 In
connection with the Offering, the Company has committed to pay a 7% fee of the
gross offering proceeds to the underwriters, of which 4% ($3,600,000) of the
total gross Offering amount is to be deferred until the consummation of an
initial business combination.
 
 Note
F—Common Stock
 
 On
October 24, 2006, the Company effected a 0.72 to 1 reverse stock split of its
common stock.  Following this reverse stock split, and prior to the
Offering, there were 3,234,375 shares of common stock outstanding.  All
references in the accompanying financial statements to the number of shares of
common stock and loss per share have been retroactively restated to reflect the
reverse stock split.
 
 Note
G—Preferred Stock
 
 The
Company is authorized to issue 5,000 shares of blank check preferred stock with
such designation, voting and other rights and preferences as may be determined
from time to time by the Board of Directors.
 
 Note
H—Income Taxes
 
 Provision
for income tax expense (benefit) consists of the following
components:
  Current:Federal
                
                $
                -State
      (New Jersey)
                
                
                155,000155,000Deferred:Federal
                
                
                (655,000
                )State
      (New Jersey)
                
                
                -(655,000
                )$
                (500,000
                )
  The total
provision for income taxes for the period ended December 31, 2007, differs from
that amount which would be computed by applying the U.S. Federal income tax rate
to income before income taxes as follows:
  Statutory
      federal income tax rate
                34%Interest
      income exempt from federal income tax
                (76)Effect
      of state income tax
                7(35%)
 At
December 31, 2007, the Company recorded a deferred tax asset in the amount of
$741,600, which is comprised entirely of the tax effect of a net operating loss
carryforward for Federal income tax purpose of approximately $2,179,946. 
The carryforward will expire in 2027, if not utilized.
 
 F-12
  Note I - Summarized Quarterly Financial Information
(Unaudited)
  Quarter
      endedDecember
      31,
                
                September
      30,
                
                June
      30,
                
                
                March
      31,2007
                
                
                2007
                
                
                2007
                
                
                2007Year
      Ended December 31, 2007Interest
      income
                
                $
                773,208
                
                
                $
                821,609
                
                
                $
                817,141
                
                
                $
                773,698General
      and administrative expenses
                
                
                672,133
                
                
                
                337,032
                
                
                
                386,567
                
                
                
                374,500Income
      before income taxes
                
                
                101,075
                
                
                
                484,577
                
                
                
                430,574
                
                
                
                399,198Income
      tax (benefit)
                
                
                (220,000
                )
                
                
                (82,000
                )
                
                
                (95,400
                )
                
                
                (102,600
                )Net
      income
                
                
                321,075
                
                
                
                566,577
                
                
                
                525,974
                
                
                
                501,798Accretion
      of trust fund relating to commonstock
      subject to possible conversion
                
                
                (139,175
                )
                
                
                (147,567
                )
                
                
                (146,291
                )
                
                
                (138,141
                )Net
      income attributable to common stockholders
                
                
                181,900
                
                
                
                419,010
                
                
                
                379,683
                
                
                
                363,657Weighted
      average common shares outstandingsubject
      to possible conversion
                
                
                2,249,999
                
                
                
                2,249,999
                
                
                
                2,249,999
                
                
                
                2,249,999Basic
      and diluted net income per share
                
                
                0.06
                
                
                
                0.07
                
                
                
                0.07
                
                
                
                0.06subject
      to possible conversionWeighted
      average number of shares outstanding
                
                
                11,812,501
                
                
                
                11,812,501
                
                
                
                11,812,501
                
                
                
                11,882,814Basic
      and diluted net income per share
                
                
                0.02
                
                
                
                0.04
                
                
                
                0.03
                
                
                
                0.03
  Quarter
      ended
                  December
      31,
                  2006
                
                
                
                July 10,
      2006
                  (date of
      inception) to
                  September 30,
      2006Year
      Ended December 31, 2006Interest
      income
                
                $
                587,219
                
                
                $
                -General
      and administrative expenses
                
                
                222,018
                
                
                
                1,500Income
      before income taxes
                
                
                365,201
                
                
                
                (1,500
                )Income
      tax (benefit)
                
                
                (52,600
                )
                
                
                -Net
      income
                
                
                417,801
                
                
                
                (1,500
                )Accretion
      of trust fund relating to commonstock
      subject to possible conversion
                
                
                (104,257
                )
                
                
                -Net
      income attributable to common stockholders
                
                
                313,544
                
                
                
                (1,500
                )Weighted
      average common shares outstandingsubject
      to possible conversion
                
                
                1,687,499
                
                
                
                -Basic
      and diluted net income per share
                
                
                0.06
                
                
                
                -subject
      to possible conversionWeighted
      average number of shares outstanding
                
                
                9,984,376
                
                
                
                3,234,375Basic
      and diluted net income per share
                
                
                0.03
                
                
                
                (0.00
                )
 
  Note J
- Subsequent Event
  The
Company issued a $250,000 unsecured promissory note to Mr. McCourt on March 14,
2008.  The promissory note is non-interest bearing and is payable on
the earlier of (a) one business day following Mr. McCourt’s written demand for
payment and (b) upon consummation of a business combination.  No
amounts have been repaid on the note.
 
  F-13