**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 July 31, 2006





**o**  **Transition
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934** ****


For
      the
      transition period from __________ to __________





**Commission
      File Number 000-51869**







**GLOBAL
      SERVICES PARTNERS ACQUISITION CORP**


(Exact
      Name of Registrant as Specified in Its Charter)










**Delaware**
            
            **20-3290391**(State
                or Other Jurisdiction of Incorporation or Organization)
            
            (IRS
                Employer Identification Number)**3130
                  Fairview Park Drive, Suite 500,****Falls
                  Church, VA**(Address
                  of Principal Executive Offices)
            
            **22042**(Zip
                Code)**Registrant’s
                  telephone number, including area code**
            
            **(703)
                  373-3143**




**Securities
      registered pursuant to Section 12(b) of the Exchange Act:**





**None**




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





**SERIES
      A UNITS, EACH CONSISTING OF TWO SHARES OF COMMON STOCK,
      PAR**


**VALUE
      $0.0001 PER SHARE, AND TEN CLASS Z WARRANTS**


**SERIES
      B UNITS, EACH CONSISTING OF TWO SHARES OF CLASS B COMMON**


**STOCK,
      PAR VALUE $0.0001 PER SHARE, AND TWO CLASS W WARRANTS**


**COMMON
      STOCK, $0.0001 PAR VALUE PER SHARE**


**CLASS
      B COMMON STOCK, $0.0001 PAR VALUE PER SHARE**


**CLASS
      W WARRANTS**


**CLASS
      Z WARRANTS**




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, or a non-accelerated filer. See definition of “accelerated
      filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check
      one):


Large
                  Accelerated Filer o
              Accelerated
                  Filer o
              Non-Accelerated
                  Filer x




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
      January 31, 2006, the aggregate market value of the registrant’s voting and
      non-voting common equity held by non-affiliates of the registrant was $0.00.




The
      number of outstanding shares of the registrant’s Common Stock, $.0001 par value,
      as of October 30, 2006 was 920,100.  The number of oustanding shares of the
      registrant's Class B Common Stock, $.0001 par value, as of October 30, 2006
      was
      5,980,000.










**GLOBAL
      SERVICES PARTNERS ACQUISITION CORP.**


**ANNUAL
      REPORT ON FORM 10-K**


**FOR
      THE FISCAL YEAR ENDED JULY 31, 2006**


**INDEX**




**Page
                  No.**PART
                  I
              3Item.
                  1  Business
              3Item
                  1B.  Unresolved Staff Comments
              30Item
                  2.  Properties
              30Item
                  3.  Legal Proceedings
              30Item
                  4.  Submission of Matters To a Vote of Security
                  Holders
              30PART
                  II
              31Item
                  5.  Market for Registrant’s Common Equity, Related Stockholder
                  Matters and Issuer Purchase of Equity Securities
              31Item
                  6.  Selected Financial Data
              32Item
                  7.  Management’s Discussion and Analysis of Financial Condition
                  and Results of Operations
              33Item
                  7A.  Quantitative and Qualitative Disclosure About Market
                  Risks
              35Item
                  8.  Financial Statements and Supplementary Data
              36Item
                  9.  Changes in and Disagreements with Accountants on Accounting
                  and Financial Disclosure
              36Item
                  9A.  Controls and Procedures
              36Item
                  9B.  Other Information
              36PART
                  III
              37Item
                  10.  Directors and Executive Officers of the
                  Registrant
              37Item
                  11.  Executive Compensation
              43Item
                  12  Security Ownership of Certain Beneficial Owners and
                  Management and Related Stockholders
              43Item
                  13.  Certain Relationships and Related Transactions
              46Item
                  14.  Principal Accountant Fees and Services
              48Item
                  15.  Exhibits, Financial Statements Schedules and Reports on
                  Form 8-K
              49








**PART
      I**





**ITEM.
      1  BUSINESS**




**CAUTIONARY
      NOTE CONCERNING FORWARD-LOOKING STATEMENTS:**




Certain
      statements in this Form 10-K constitute forward-looking statements for purposes
      of the securities laws. Forward-looking statements include all statements that
      do not relate solely to the historical or current facts, and can be identified
      by the use of forward looking words such as “may”, “believe”, “will”, “expect”,
“expected”, “project”, “anticipate”, “anticipated”, “estimates”, “plans”,
“strategy”, “target”, “prospects” or “continue”. These forward looking
      statements are based on the current plans and expectations of our management
      and
      are subject to a number of uncertainties and risks that could significantly
      affect our current plans and expectations, as well as future results of
      operations and financial condition and may cause our actual results,
      performances or achievements to be materially different from any future results,
      performances or achievements expressed or implied by such forward-looking
      statements. This Form 10-K contains important information as to risk factors
      above. In making these forward-looking statements, we claim the protection
      of
      the safe-harbor for forward-looking statements contained in the Private
      Securities Reform Act of 1995. Although we believe that the expectations
      reflected in such forward-looking statements are reasonable, there can be no
      assurance that such expectations will prove to have been correct. We do not
      assume any obligation to update these forward-looking statements to reflect
      actual results, changes in assumptions, or changes in other factors affecting
      such forward-looking statements.




**AVAILABLE
      INFORMATION**




This
      report may be read or copied at the SEC’s Public Reference Room at 100 F Street,
      NE, Washington, DC 20549 or at www.sec.gov **.** Information on the operation of the Public Reference Room may be obtained by
      calling the SEC at 1-800-SEC-0330.




**Introduction**




We
      are a
      Delaware blank check company incorporated under the laws of the State of
      Delaware on August 10, 2005, to serve as a vehicle for the acquisition of an
      operating business. Our efforts in identifying a prospective target business
      are
      not limited to a particular industry. However, our management has significant
      experience and relationships in the business process services industry and
      we
      are initially focusing on target businesses in this industry.




On
      April
      25, 2006, we consummated our initial public offering of 460,000 Series A units
      and 2,990,000 Series B units, which included the full exercise of the
      over-allotment option. Each Series A Unit consists of two shares of Common
      Stock, $.0001 par value per share and ten Class Z Warrants, each to purchase
      one
      share of Common Stock. Each Series B Unit consists of two shares of Class B
      Common Stock, $.0001 par value per share, and two Class W Warrants, each to
      purchase one share of Common Stock. The Series A units were sold at an offering
      price of $8.50 per Series A Unit and the Series B units were sold at an offering
      price of $10.10 per Series B Unit, generating gross proceeds of $34,109,000.
      After deducting the underwriting discounts and commissions and the offering
      expenses, the total net proceeds to us from the offering were approximately
      $31.6 million of which $30,199,000 was deposited into the trust account and
      the
      remaining proceeds $1,378,473 became available to be used to provide for
      business, legal and accounting due diligence on prospective business
      combinations and continuing general and administrative expenses. Through July
      31, 2006, net cash used to pay general and administrative expenses was $59,069.
      The net proceeds deposited into the trust fund remain on deposit in the trust
      fund earning interest. As of July 31, 2006, there was $30,449,626 held in the
      trust fund.




3


We
      are
      not presently engaged in, and we will not engage in, any substantive commercial
      business until we consummate a business combination. We intend to utilize our
      cash, including the funds held in the trust fund, capital stock, debt or a
      combination of the foregoing in effecting a business combination. A business
      combination may involve the acquisition of, or merger with, a company which
      does
      not need substantial additional capital but which desires to establish a public
      trading market for its shares, while avoiding what it may deem to be adverse
      consequences of undertaking a public offering itself. These transactions include
      time delays, significant expense, loss of voting control and compliance with
      various Federal and state securities laws. In the alternative, we may seek
      to
      consummate a business combination with a company that may be financially
      unstable or in its early stages of development or growth.




**The
      business process services industry**




The
      business process services industry encompasses companies that undertake, on
      a
      contract basis, the management, delivery, or operation of one or more business
      processes or functions of other companies. Segments within the business process
      services industry include, but are not limited to:




· information
      technology services;




· finance
      and accounting services;




· human
      resources management services;




· payment
      services;




· manufacturing
      services;




· design
      services;




· media
      production services;




· research
      services;




· distribution
      and logistics services;




· sales/marketing
      services;




· customer
      care services; and




4


· claims/transaction
      processing services.




While
      we
      have not prioritized or determined which segment or segments of the business
      process services industry we may focus on, we are initially focusing on target
      companies operating in the United States that, prior to the business
      combination, have high cost structures and operating inefficiencies which we
      believe can be readily improved. Following the business combination, we will
      seek to lower the target business’ cost structure, improve its operations and
      enhance its value through various means, including the reallocation of operating
      resources within the target company, the relocation of labor resources to
      jurisdictions with more favorable labor rates, such as India or the Philippines,
      and the implementation of productivity technologies.




**Selection
      of a target business and structuring a business combination**




While
      we
      have not yet identified any acquisition candidates, we believe that there are
      numerous acquisition candidates for us to target. We have generated an initial
      list of potential target opportunities from a host of different sources and
      have
      initiated discussions with several potential candidates. The candidates
      comprising the list of potential business combinations are being and will
      continue to be examined through analysis of available information and general
      due diligence to identify areas where operational efficiency can be enhanced.
      We
      will narrow our search for potential target opportunities through this due
      diligence process, focusing on what we determine are the most promising
      businesses that can benefit from efforts to improve operating efficiencies
      and
      cost structures. We anticipate that additional target business candidates will
      be brought to our attention from various unaffiliated sources, including
      securities broker-dealers, investment bankers, venture capitalists, bankers
      and
      other members of the financial community. Target businesses may be brought
      to
      our attention by such unaffiliated sources as a result of being solicited by
      us
      through calls, meetings or mailings. These sources may also introduce us to
      target businesses they think we may be interested in on an unsolicited basis,
      based on our recent public offering and our other public filings and reports
      and
      know the types of businesses we are targeting. Our initial securityholders,
      including our officers, directors and senior advisors, and their affiliates
      may
      also bring to our attention target business candidates that they become aware
      of
      through their business contacts as a result of formal or informal inquiries
      or
      discussions they may have, as well as attending trade shows or conventions.
      We
      may engage professional firms that specialize in business acquisitions in the
      future, in which event we may pay a finder’s fee or other compensation. In no
      event, however, will we pay any of our initial stockholders or any entity with
      which they are affiliated any finder’s fee or other compensation for services
      rendered to us prior to or in connection with the consummation of a business
      combination.




Subject
      to the requirement that our initial business combination must be with a target
      business that has a fair market value that is equal to at least 80% of our
      net
      assets at the time of such acquisition, our management has virtually
      unrestricted flexibility in identifying and selecting a prospective target
      business. We have not established any other specific attributes or criteria
      (financial or otherwise) for prospective target businesses, though we are
      initially focusing on the business services sector. Moreover, there is no
      limitation on our ability to raise additional funds through the sale of our
      securities or through loan transactions that would, if we were successful in
      raising such funds, enable us to acquire a target company with a fair market
      value significantly in excess of 80% of our net assets.




5


In
      evaluating a prospective target business, our management will consider, among
      other factors, the following:




· financial
      condition and results of operation;




· growth
      potential;




· experience
      and skill of management and availability of additional personnel;




· high
      cost
      labor intensive operations that can be relocated to lower cost jurisdictions;




· capital
      requirements;




· competitive
      position;




· barriers
      to entry;




· stage
      of
      development of the products, processes or services;




· degree
      of
      current or potential market acceptance of the products, processes or services;




· proprietary
      features and degree of intellectual property or other protection of the
      products, processes or services;




· regulatory
      environment of the industry; and




· costs
      associated with effecting the business combination.




The
      above
      criteria are not intended to be exhaustive. Any evaluation relating to the
      merits of a particular business combination will be based, to the extent
      relevant, on the above factors as well as other considerations deemed relevant
      by our management in effecting a business combination consistent with our
      business objective. In evaluating a prospective target business, we will conduct
      an extensive due diligence review which will encompass, among other things,
      meetings with incumbent management and inspection of facilities, as well as
      review of financial and other information which will be made available to us.
      This due diligence review will be conducted either by our management or by
      unaffiliated third parties we may engage, although we have no current intent
      to
      engage any such third parties. We will also seek to have all prospective target
      businesses execute agreements with us waiving any right, title, interest or
      claim of any kind in or to any monies held in the trust. If any prospective
      target business refuses to execute such agreement, it is unlikely we would
      continue negotiations with such target business.




We
      will
      endeavor to structure a business combination so as to achieve the most favorable
      tax treatment to us, the target business and both companies’ stockholders. We
      cannot assure you, however, that the Internal Revenue Service or appropriate
      state tax authorities will agree with our tax treatment of the business
      combination.




6


The
      time
      and costs required to select and evaluate a target business and to structure
      and
      complete the business combination cannot presently be ascertained with any
      degree of certainty. Any costs incurred with respect to the identification
      and
      evaluation of a prospective target business with which a business combination
      is
      not ultimately completed will result in a loss to us and reduce the amount
      of
      capital available to otherwise complete a business combination.




We
      have
      engaged HCFP/Brenner Securities, the representative of the underwriters of
      our
      initial public offering, on a non-exclusive basis, to act as our investment
      banker to assist us in structuring a business combination and negotiating its
      terms (but not for purposes of locating potential target candidates for our
      business combination). We will pay the representative a cash fee at the closing
      of our business combination of $900,000.




**Fair
      market value of target business**




The
      initial target business that we acquire must have a fair market value equal
      to
      at least 80% of our net assets at the time of such acquisition, although we
      may
      acquire a target business whose fair market value significantly exceeds 80%
      of
      our net assets. To this end, we may seek to raise additional funds through
      the
      sale of our securities or through loan arrangements if such funds are required
      to consummate such a business combination, although we have not engaged or
      retained, had any discussions with, or entered into any agreements with, any
      third party regarding any such potential financing transactions. If we were
      to
      seek such additional funds, any such arrangement would only be consummated
      simultaneously with our consummation of a business combination. The fair market
      value of such business will be determined by our board of directors based upon
      standards generally accepted by the financial community, such as actual and
      potential sales, earnings and cash flow and book value. If our board is not
      able
      to independently determine that the target business has a sufficient fair market
      value, we will obtain an opinion from an unaffiliated, independent investment
      banking firm that is a member of the National Association of Securities Dealers,
      Inc. with respect to the satisfaction of such criteria. Since any opinion,
      if
      obtained, would merely state that the fair market value of the target business
      meets the 80% of net assets threshold, it is not anticipated that copies of
      such
      opinion would be distributed to our stockholders, although copies will be
      provided to stockholders who request it. We will not be required to obtain
      an
      opinion from an investment banking firm as to the fair market value if our
      board
      of directors independently determines that the target business has sufficient
      fair market value.




*Opportunity
      for Class B stockholder approval of business combination*




Prior
      to
      the completion of a business combination, we will submit the transaction to
      our
      Class B stockholders for approval, even if the nature of the acquisition would
      not ordinarily require stockholder approval under applicable state law. In
      connection with seeking Class B stockholder approval of a business combination,
      we will furnish our Class B stockholders with proxy solicitation materials
      prepared in accordance with the Securities Exchange Act of 1934, which, among
      other matters, will include a description of the operations of the target
      business and audited historical financial statements of the business. These
      materials will also be mailed to the holders of our common stock although their
      vote will not be solicited.




7


We
      will
      not proceed with a business combination if the holders of a majority of the
      shares of Class B common stock cast at the meeting to approve the business
      combination fail to vote in favor of such business combination or if
      stockholders owning 20% or more of the outstanding shares of Class B common
      stock both exercise their conversion rights and vote against the business
      combination.




*Conversion
      rights*




At
      the
      time we seek Class B stockholder approval of any business combination, we will
      offer each Class B stockholder the right to have his, her or its shares of
      Class
      B common stock converted to cash if he, she or it votes against the business
      combination and the business combination is approved and completed. The holders
      of our common stock will not be entitled to seek conversion of their shares.
      The
      actual per-share conversion price will be equal to the amount in the trust
      fund
      inclusive of any interest (calculated as of two business days prior to the
      proposed consummation of the business combination), divided by the number of
      Class B shares sold in our initial public offering. Without taking into account
      any interest earned on the trust fund, the initial aggregate conversion price
      of
      a share of Class B common stock would be $5.05. An eligible Class B stockholder
      may request conversion at any time after the mailing to our Class B 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 Class B stockholder votes against the business
      combination and the business combination is approved and completed. 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 Class B
      stockholders entitled to convert their Class B shares who elect conversion
      will
      be distributed promptly after completion of a business combination. Any Class
      B
      stockholder who converts his, her or its Class B common stock into his, her
      or
      its share of the trust fund still has the right to exercise the Class W warrants
      that he, she or it received as part of the Series B units. We will not complete
      any business combination if Class B stockholders, owning 20% or more of the
      Class B shares outstanding, both vote against the business combination and
      exercise their conversion rights.




*Distribution
      of trust fund to Class B stockholders if no business combination*




If
      we do
      not complete a business combination by October 25, 2007, or by April 25, 2008
      if
      the extension criteria described below have been satisfied, our charter provides
      that we distribute to all of our Class B stockholders, in proportion to their
      respective equity interest in the Class B common stock, an aggregate sum equal
      to the amount in the trust fund, inclusive of any interest, and all then
      outstanding shares of Class B common stock will be automatically cancelled.
      There will be no distribution from the trust fund with respect to our common
      stock or our Class W and Class Z warrants. Our charter provides that certain
      provisions that apply prior to a business combination, including those
      provisions relating to the distribution of the trust fund if no business
      combination occurs within the prescribed time periods, cannot be amended. Our
      counsel has advised us that these restrictions on charter amendments may not
      be
      enforceable under Delaware law. Nevertheless, we view these business combination
      procedures in our charter as obligations to investors and we will not propose
      any amendment to these procedures to our stockholders.




8


Without
      taking into account any interest earned on the trust fund, the initial aggregate
      conversion price of a share of Class B common stock would be $5.05. The proceeds
      deposited in the trust fund could, however, become subject to the claims of
      our
      creditors which could be prior to the claims of our Class B stockholders. We
      cannot assure you that the actual distribution per Class B share will not be
      less than $5.05, plus interest, due to claims of creditors. If we are unable
      to
      complete a business combination and are forced to distribute the proceeds held
      in trust to our Class B stockholders, each of Rahul Prakash, our Chairman of
      the
      Board and Chief Executive Officer, Abhishek Jain, our President and a member
      of
      our Board of Directors, and Avinash Vashistha, our Executive Vice President
      and
      Chief Financial Officer and a member of our Board of Directors, have agreed
      that
      they will be personally liable to ensure that the proceeds in the trust fund
      are
      not reduced by the claims of target businesses or of vendors or other entities
      that are owed money by us for services rendered or contracted for or products
      sold to us and that have not executed an agreement waiving any right, title,
      interest or claim of any kind in or to any monies held in the trust. However,
      we
      cannot assure you that these individuals will be able to satisfy those
      obligations. If we enter into either a letter of intent, an agreement in
      principle or a definitive agreement to complete a business combination prior
      to
      October 25, 2007, but are unable to complete the business combination by such
      date, then we will have an additional six months in which to complete the
      business combination contemplated by the letter of intent, agreement in
      principle or definitive agreement. If we are unable to do so by April 25, 2008,
      we will then notify the trustee of the trust fund to commence liquidating the
      investments constituting the trust fund and will turn over the proceeds to
      our
      transfer agent for distribution to our Class B stockholders. We anticipate
      that
      our instruction to the trustee would be given promptly after such applicable
      date.




A
      Class B
      stockholder shall be entitled to receive funds from the trust fund only in
      the
      event we do not complete a business combination within the applicable time
      periods or if the Class B stockholder elected to convert his, her or its shares
      into cash upon our completion of a business combination that the Class B
      stockholder voted against and such business combination is actually completed
      by
      us. In no other circumstances shall a Class B stockholder have any right or
      interest of any kind to or in the trust fund. Holders of our common stock will
      not be entitled to receive any of the proceeds held in the trust fund.




*Liquidation
      if no business combination*




If
      we do not complete a business combination by
      October 25, 2007 (or April 25, 2008 if the extension criteria described
      above have been satisfied), we will be dissolved and any remaining net assets,
      after the distribution of the trust fund to our Class B stockholders, will
      be
      distributed to the holders of our common stock. It is likely, however that
      our
      remaining net assets will be minimal following the expenditures incurred in
      connection with the attempt to complete a business combination and, accordingly,
      such holders are likely to lose all or substantially all of their investment.
      Accordingly, the holders of our common stock will receive distributions on
      liquidation only in the event that the amount of proceeds not held in trust
      exceeds the expenses we incur.




9


**Competition**




In
      identifying, evaluating and selecting a target business, we expect to encounter
      intense competition from other entities having a business objective similar
      to
      ours. There are numerous blank check companies that have completed initial
      public offerings that are seeking to carry out a business plan similar to our
      business plan. Additionally, we may be subject to competition from other
      companies looking to expand their operations through the acquisition of a target
      business. 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 technical, human and
      other
      resources than us and our financial resources will be relatively limited when
      contrasted with those of many of these competitors. While we believe there
      are
      numerous potential target businesses that we could acquire, our ability to
      compete in acquiring certain sizable target businesses will be limited by our
      available financial resources. This inherent competitive limitation gives others
      an advantage in pursuing the acquisition of a target business.
      Further:


·
            our
                obligation to seek Class B stockholder approval of a business combination
                may delay the completion of a transaction;


·
            our
                obligation to convert into cash shares of Class B common stock held
                by our
                Class B stockholders if such holders both vote against the business
                combination and also seek conversion of their shares may reduce the
                resources available to us for a business combination; and  ·
            our
                outstanding warrants and option, and the future dilution they potentially
                represent, may not be viewed favorably by certain target businesses.


Any
      of
      these factors may place us at a competitive disadvantage in successfully
      negotiating a business combination. Our management believes, however, that
      our
      status as a public entity and potential access to the United States public
      equity markets may give us a competitive advantage over privately-held entities
      having a similar business objective as us in acquiring a target business on
      favorable terms.




If
      we
      succeed in effecting a business combination, there will be, in all likelihood,
      intense competition from competitors of the target business. In particular,
      certain industries which experience rapid growth frequently attract an
      increasingly larger number of competitors, including competitors with
      increasingly greater financial, marketing, technical and other resources than
      the initial competitors in the industry. The degree of competition
      characterizing the industry of any prospective target business cannot presently
      be ascertained. We cannot assure you that, subsequent to a business combination,
      we will have the resources or ability to compete effectively.




**Facilities**




We
      maintain our executive offices at 3130 Fairview Park Drive, Suite 500, Falls
      Church, Virginia 22042. The cost for this space is included in the $7,500
      per-month fee. Everest Telecom LLC charges us for general and administrative
      services pursuant to a letter agreement between us and Everest Telecom LLC,
      an
      affiliate of Mr. Prakash. We believe, based on rents and fees for similar
      services in the northern Virginia area, that the fee charged by Everest Telecom
      LLC is at least as favorable as we could have obtained from an unaffiliated
      person. We consider our current office space adequate for our current
      operations.




10


**Employees**




We
      have
      three executive officers, all of whom are also members of our board of
      directors. These individuals are not obligated to contribute any specific number
      of hours to our matters and intend to devote only as much time as they deem
      necessary to our affairs. The amount of time they will devote in any time period
      will vary based on whether a target business has been selected for a business
      combination and the stage of our business combination process. Accordingly,
      once
      management locates a suitable target business to acquire, they will spend more
      time investigating such target business and negotiating and processing the
      business combination (and consequently more time on our affairs) than they
      would
      prior to locating a suitable target business.




**ITEM
      1A.** **RISK
      FACTORS**




*Future
      results of our operations involve a number of known and unknown risks and
      uncertainties. Factors that could affect future operating results and cash
      flows
      and cause actual results to vary materially from historical results include,
      but
      are not limited to those risks set forth below:*




**Risks****associated
      with our business**




**We
      are a development stage company with no****operating
      history and very limited resources.**




We
      are a
      recently incorporated development stage company with no operations to date
      other
      than organizational activities. 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 acquire an operating business. Although we have initiated
      discussions with several potential candidates for a business combination, we
      have not yet entered into any letters of intent, agreements, or other
      arrangements relating to a business combination. We have no present revenue
      and
      will not generate any revenue until, at the earliest, after the consummation
      of
      a business combination. We believe we have sufficient available funds to operate
      until such time as a business combination is consummated or we are required
      to
      dissolve and liquidate.




***If
      we are unable to complete a business combination, holders of our*** **common
      *stock will be unable to convert their securities and participate in the
      distribution of the trust fund.***




The
      trust
      fund is reserved for holders of our Class B common stock acquired as part of
      the
      Series B units sold in our initial public offering. Consequently, if we are
      unable to complete a business combination by October 25, 2007 or April 25,
      2008
      if the extension criteria described below have been satisfied, the holders
      of
      common stock that was sold as part of the Series A units will not be entitled
      to
      participate in the distribution of the trust fund. Furthermore, there will
      be no
      distribution from the trust fund with respect to our outstanding Class W
      warrants and Class Z warrants.




11


***Holders
      of the shares of common stock will not be entitled to vote those shares on
      a
      proposed business combination.***




Unless
      required by the Delaware General Corporation Law, holders of the shares of
      common will not be entitled to vote those shares on a proposed business
      combination with a target business. Only the holders of Class B common stock
      will have an opportunity to approve a business combination. Consequently,
      holders of common stock and warrants will be entirely dependent upon the
      judgment of the holders of Class B common stock in determining whether or not
      a
      proposed business combination is approved.




***Because
      there are numerous companies with a business plan similar to ours seeking to
      effectuate a business combination, it may be more difficult for us to complete
      a
      business combination.***




There
      are
      numerous blank check companies which have gone public in the United States
      since
      August 2003 that are seeking to complete business combinations. Furthermore,
      there are numerous additional offerings for blank check companies in the United
      States that are still in the registration process but have not completed initial
      public offerings and there are likely to be more blank check companies filing
      registration statements for initial public offerings prior to our completion
      of
      a business combination. While some of the blank check companies must complete
      their respective business combinations in specific industries, a number of
      them
      may consummate their business combinations in any industry they choose.
      Therefore, we may be subject to competition from these and other companies
      seeking to consummate a business combination. We cannot assure you that we
      will
      be able to successfully compete for an attractive business combination.
      Additionally, because of this competition, we cannot assure you that we will
      be
      able to effectuate a business combination within the required time period.




***If
      third parties bring claims against us, the proceeds held in trust could be
      reduced and the per-share distribution received by Class B stockholders could
      be
      less than $5.05 per share.***




Our
      placing of funds in trust may not protect those funds from third party claims
      against us. Although we will seek to have all vendors, prospective target
      businesses or other entities we engage, execute agreements with us waiving
      any
      right, title, interest or claim of any kind in or to any monies held in the
      trust fund for the benefit of the holders of our Class B common stock, there
      is
      no guarantee that they will execute such agreements or that even if they execute
      such agreements that they would be prevented from bringing claims against the
      trust fund. Nor is there any guarantee that such entities will agree to waive
      any claims they may have in the future as a result of, or arising out of, any
      negotiations, contracts or agreements with us and will not seek recourse against
      the trust fund for any reason. Accordingly, the proceeds held in trust could
      be
      subject to claims which could take priority over the claims of the holders
      of
      our Class B common stock. We cannot assure you that the per-share distribution
      from the trust fund will not be less than $5.05 due to claims of creditors.
      If
      we are unable to complete a business combination and are forced to distribute
      the proceeds held in trust to the holders of our Class B common stock, our
      executive officers Rahul Prakash, Abhishek Jain and Avinash Vashistha, have
      agreed that they will be personally liable to ensure that the proceeds in the
      trust fund are not reduced by the claims, if any, of target businesses or of
      vendors or other entities that are owed money by us for services rendered or
      contracted for or products sold to us and that have not executed an agreement
      waiving any right, title, interest or claim of any kind in or to any monies
      held
      in the trust. However, we cannot assure you that these individuals will be
      able
      to satisfy those obligations. Furthermore, even after our
      liquidation (including the distribution of the funds then held in the trust
      account), under the Delaware General Corporation Law, stockholders may be held
      liable for claims by third parties against a corporation to the extent of
      distribution received by them in a dissolution. As
      a
      result, and because of the significant limitations on their indemnification
      obligations described above, we believe that these individuals will be able
      to
      satisfy their indemnification obligations. However, we cannot assure you this
      will be the case. Accordingly, the proceeds held in trust could be subject
      to
      claims which could take priority over the claims of the holders of our Class
      B
      common stock and we cannot assure you that the per-share distribution from
      the
      trust fund will not be less than $5.05 due to claims of creditors.




12


***Our
      common stockholders and our Class B stockholders may be held liable for claims
      by third parties against us to the extent of distributions received by
      them.***




Under
      Sections 280 through 282 of the Delaware General Corporation Law, stockholders
      may be held liable for claims by third parties against a corporation to the
      extent of distributions received by them in a dissolution. If the corporation
      complies with certain procedures set forth in Section 280 of the Delaware
      General Corporation Law intended to ensure that it makes reasonable provision
      for all claims against it, including a 60-day notice period during which any
      third-party claims can be brought against the corporation, a 90-day period
      during which the corporation may reject any claims brought, and an additional
      150-day waiting period before any liquidating distributions are made to
      stockholders, any liability of stockholders with respect to a liquidating
      distribution is limited to the lesser of such stockholder’s pro rata share of
      the claim or the amount distributed to the stockholder, and any liability of
      the
      stockholder would be barred after the third anniversary of the dissolution.
      However, it is our intention to distribute the proceeds of the trust fund to
      our
      Class B stockholders and make liquidating distributions to our common
      stockholders as soon as reasonably possible after dissolution and, therefore,
      we
      do not intend to comply with those procedures. Because will
      will not be complying with those procedures, we are required, pursuant to
      Section 281 of the Delaware General Corporation Law, to adopt a plan that will
      provide for our payment, based on facts known to us at such time of (i) all
      existing claims, (ii) all pending claims and (iii) all claims that may be
      potentially brought against us within the subsequent 10 years. Accordingly,
      we
      would be required to provide for any creditors known to us at that time prior
      to
      distributing the funds held in trust to the stockholders. We cannot assure
      you
      that we will properly assess all claims that may be potentially brought against
      us. As
      such,
      our common stockholders and Class B common stockholders could potentially be
      liable for any claims to the extent of distributions received by them in a
      dissolution and any liability of our common stockholders and Class B
      stockholders may extend beyond the third anniversary of such dissolution.
      Accordingly, we cannot assure you that third parties will not seek to recover
      from our common stockholders and Class B stockholders amounts owed to them
      by
      us.




Additionally,
      if we are forced to file a bankruptcy case or an involuntary bankruptcy case
      is
      filed against us which is not dismissed, any distributions received by
      stockholders could be viewed under applicable debtor/creditor and/or bankruptcy
      laws as either a “preferential transfer” or a “fraudulent conveyance”. As a
      result, a bankruptcy court could seek to recover all amounts received by our
      stockholders in our dissolution.






13


***Since
      we have not yet identified a target business, and our search and selection
      of a
      target business with which to complete a business
      combination*** ***is
      not limited to any particular industry, we cannot currently ascertain the merits
      or risks of the business which we may ultimately acquire or the industry in
      which we may ultimately operate.***




We
      may
      consummate a business combination with a company in any industry we choose
      and
      are not limited to any particular industry or type of business. Moreover, as
      of
      the date of this report, we have only had discussions with potential target
      businesses, but have not yet entered into any letters of intent, arrangements
      or
      other agreements related to a business combination. Accordingly, there is no
      current basis for you to evaluate the possible merits or risks of the particular
      industry in which we may ultimately operate or the target business which we
      may
      ultimately acquire. To the extent we complete a business combination with a
      financially unstable company or an entity in its development stage, we may
      be
      affected by numerous risks inherent in the business operations of those
      entities. If we complete a business combination with an entity in an industry
      characterized by a high level of risk, we may be affected by the currently
      unascertainable risks of that industry. Although our management will endeavor
      to
      evaluate the risks inherent in a particular industry or target business, we
      cannot assure you that we will properly ascertain or assess all of the
      significant risk factors. We also cannot assure you that an investment in our
      securities will not ultimately prove to be less favorable than a direct
      investment, if an opportunity were available, in a target business.




14
 
 ***We
          may issue shares of our capital stock or debt securities to complete a
          business
          combination, which would reduce the equity interest of our stockholders
          and
          likely cause a change in control of our ownership.***


Our
      certificate of incorporation, as amended, authorizes the issuance of up to
      24,000,000 shares of common stock, par value $.0001 per share, 7,000,000 shares
      of Class B common stock, par value $.0001 per share, and 5,000 shares of
      preferred stock, par value $.0001 per share. As of October 30, 2006, there
      were
      2,684,900 and 1,020,000 authorized but unissued shares of our common stock
      and
      Class B common stock, respectively, available for issuance (after appropriate
      reservation for the issuance of shares upon conversion of the Class B common
      stock and upon full exercise of our outstanding Class W warrants and Class
      Z
      warrants and the purchase option granted to HCFP/Brenner Securities, the
      representative of the underwriters of our initial public offering) and all
      of
      the 5,000 shares of preferred stock available for issuance. Although we
      currently have no commitments to issue our securities, we will, in all
      likelihood, issue a substantial number of additional shares of our common stock
      or preferred stock, or a combination of common and preferred stock, to the
      shareholders of a potential target or in connection with a related simultaneous
      financing 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 our investors;  ·
            may
                subordinate the rights of holders of common stock if preferred stock
                is
                issued with rights senior to those afforded to our common stockholders;  ·
            will
                likely 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 carryforwards, if any, and most likely
                also
                result in the resignation or removal of some or all of our present
                officers and directors; and  ·
            may
                adversely affect prevailing market prices for our common stock.  Similarly,
        if we issue debt securities, it could result in:
  ·
            default
                and foreclosure on our assets if our operating revenues after a business
                combination were insufficient to pay our debt obligations;  ·
            acceleration
                of our obligations to repay the indebtedness even if we have made
                all
                principal and interest payments when due if the debt security contains
                covenants that require the maintenance of certain financial ratios
                or
                reserves and any such covenant is breached without a waiver or
                renegotiation of that covenant;  ·
            our
                immediate payment of all principal and accrued interest, if any,
                if the
                debt security is payable on demand; and  ·
            our
                inability to obtain additional financing, if necessary, if the debt
                security contains covenants restricting our ability to obtain additional
                financing while such security is outstanding.  15


***Our
      ability to effect successfully a business combination and to be successful
      afterwards*** ***is
      totally dependent upon the efforts of our key personnel, some of whom may join
      us following a business combination and whom we would have only a limited
      ability to evaluate.***




Our
      ability to effect successfully a business combination is totally dependent
      upon
      the efforts of our key personnel. The future role of our key personnel in the
      target business, however, cannot presently be ascertained. Although we expect
      Messrs. Rahul Prakash, Abhishek Jain and Avinash Vashistha, our executive
      officers, to remain with us in senior management or advisory positions following
      a business combination, we may employ other personnel following the business
      combination. Moreover, management will only be able to remain with the company
      after the consummation of a business combination if members of management are
      able to negotiate employment or consulting agreements in connection with the
      business combination. Such negotiations would take place simultaneously with
      the
      negotiation of the business combination and could provide for such individuals
      to receive compensation in the form of cash payments and/or securities for
      services they would render to the company after the consummation of the business
      combination. While the personal and financial interests of such individuals
      may
      cause them to have a conflict of interest in determining whether a potential
      business combination is appropriate for us and influence their motivation in
      identifying and selecting a target business, the ability of such individuals
      to
      remain with the company after the consummation of a business combination will
      not be the determining factor in our decision as to whether or not we will
      proceed with any potential business combination. While we intend to closely
      scrutinize any additional individuals we engage after a business combination,
      we
      cannot assure you that our assessment of these individuals will prove to be
      correct. These individuals may be unfamiliar with the requirements of operating
      a public company which could cause us to have to expend time and resources
      helping them become familiar with such requirements. This could be expensive
      and
      time-consuming and could lead to various regulatory issues.




***Because
      our officers, directors and senior advisors allocate their time to other
      businesses, it*** ***may
      interfere with our ability to consummate a business combination.***




Our
      officers, directors and senior advisors are not required to commit their full
      time to our affairs, which may result in a conflict of interest in allocating
      their time between our operations and other businesses. We do not intend to
      have
      any full time employees prior to the consummation of a business combination.
      All
      of our officers, directors and senior advisors are engaged in several other
      business endeavors and are not obligated to contribute any specific number
      of
      hours to our affairs. If their other business affairs require them to devote
      more substantial amounts of time to such affairs, it could limit their ability
      to devote time to our affairs and could interfere with our ability to consummate
      a business combination.




***Our
      officers, directors and senior advisors may in the future become affiliated
      with
      entities engaged in business activities similar to those intended to be
      conducted by us and accordingly, may have conflicts of interest in determining
      which entity a particular business opportunity should be presented to.***




Except
      for Saurabh Srivastava , none of our officers, directors or senior advisors
      or
      any of their respective affiliates have previously been associated with a blank
      check company. Mr. Srivastava has served as the director of East India Company
      Acquisition Corp., a structured blank check company the purpose of which is
      to
      complete a business combination with an operating business that derives the
      majority of its revenues from operations in India or that has a majority of
      its
      assets located in India. As of the date hereof, East India Company Acquisition
      Corp. has not yet completed its initial public offering. Our officers, directors
      and/or senior advisors may also 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. Our officers, directors and/or senior
      advisors may become aware of business opportunities which may be appropriate
      for
      presentation to us as well as the other entities to which they have fiduciary
      obligations. Accordingly, they may have conflicts of interest in determining
      to
      which entity a particular business opportunity should be presented.




16


***All
      of our officers, directors and senior advisors own securities of ours which
      will
      not participate in the distribution of the trust fund or distributions upon
      our
      liquidation. This may cause them to have a conflict of interest in determining
      whether a particular target business is appropriate for a business combination.***




The
      common stock, Class W warrants and Class Z warrants owned by our officers,
      directors and senior advisors will become worthless if we do not consummate
      a
      business combination. The personal and financial interests of our officers,
      directors and senior advisors may influence their motivation in identifying
      and
      selecting a target business and completing a business combination. Consequently,
      our officers’, directors’ and senior advisors’ discretion in identifying and
      selecting a suitable target business may result in a conflict of interest when
      determining whether the terms, conditions and timing of a particular business
      combination are appropriate and in our stockholders’ best interest. To the
      extent such individuals purchase Class B common stock, they are entitled to
      vote
      as they choose on a proposal to approve a business combination and exercise
      conversion rights in connection therewith. These individuals may not have the
      same interests as other Class B common stockholders.




***If
      our common stock or Class B 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
      or
      Class B common stock has a market price per share of less than $5.00,
      transactions in our securities may be subject to the “penny stock” rules
      promulgated under the Securities Exchange Act of 1934. 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  17
 ·
            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 and Class B 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.




**It
      is probable that we will only****be
      able to complete one business combination, which will cause us to be solely
      dependent on a single business and a limited number of products or services.**




As
      of
      July 31, 2006, we had $30,449,626 on deposit in a trust fund that we may use
      to
      complete a business combination. Our initial business combination must be with
      a
      business with a fair market value of at least 80% of our net assets at the
      time
      of such acquisition. Consequently, initially we will have the ability to
      complete only a single business combination, although this may entail the
      simultaneous acquisitions of several closely related operating businesses.
      By
      consummating a business combination with only a single entity, our lack of
      diversification may subject us to numerous economic, competitive and regulatory
      developments, any or all of which may have a substantial adverse impact upon
      the
      particular industry in which we may operate subsequent to a business
      combination. Further, we would not be able to diversify our operations or
      benefit from the possible spreading of risks or offsetting of losses, unlike
      other entities which may have the resources to complete several business
      combinations in different industries or different areas of a single industry.
      Accordingly, the prospects for our success may be:




·
            solely
                dependent upon the performance of a single business; or


·
            dependent
                upon the development or market acceptance of a single or limited
                number of
                products, processes or services.


Alternatively,
      if our business combination entails the simultaneous acquisitions of several
      operating businesses and with different sellers, each seller will need to agree
      that the purchase of its business is contingent upon simultaneous closings
      of
      the other acquisitions which may make it more difficult for us, and delay our
      ability, to complete the business combination. If we were to consummate a
      business combination with several operating businesses, we could also face
      additional risks, including burdens and costs with respect to possible multiple
      negotiations and due diligence investigations (if there are multiple sellers)
      and the additional risks associated with the subsequent assimilation of the
      operations and services or products of the acquired companies into a single
      operating business. If we are unable to address these risks adequately, we
      may
      not be able to achieve the optimal result of the merger, including improving
      productivity, efficiencies, profitability and operating results.




***Because
      of our limited resources and structure, we may not be able to consummate an
      attractive business combination.***




We
      expect
      to encounter intense competition from other entities with business objectives
      similar to ours, including venture capital funds, leveraged buyout funds and
      operating businesses competing for acquisitions. Many of these entities are
      well
      established and have extensive experience in identifying and effecting business
      combinations directly or through affiliates. Many of these competitors possess
      greater technical, human and other resources than we do and our financial
      resources will be relatively limited when contrasted with those of many of
      these
      competitors. While we believe that there are numerous potential target
      businesses that we could acquire with the net proceeds of our initial public
      offering, our ability to compete in acquiring certain sizable target businesses
      will be limited by our available financial resources. This inherent competitive
      limitation gives others an advantage in pursuing the acquisition of certain
      target businesses. Further, the obligation we have to seek Class B stockholder
      approval of a business combination may delay the consummation of a transaction,
      and our obligation to convert into cash the shares of Class B common stock
      in
      certain instances may reduce the resources available for a business combination.
      Additionally, our outstanding Class W warrants and Class Z warrants, and the
      future dilution they potentially represent, may not be viewed favorably by
      certain target businesses. Any of these factors may place us at a competitive
      disadvantage in successfully negotiating a business combination. The fact that
      less than half of the blank check companies that have gone public in the United
      States since August 2003 have completed a business combination or entered into
      a
      definitive agreement for a business combination may indicate that many privately
      held target businesses are not inclined to enter into a business combination
      with a blank check company. If we are unable to consummate a business
      combination with a target business within the prescribed time period, we will
      be
      forced to liquidate and, in such case, the holders of our common stock and
      warrants will lose their entire investment.




18


***We
      may be unable to obtain additional financing, if required, to complete a
      business combination or to fund the operations and growth of the target
      business, which could compel us to restructure the transaction or abandon a
      particular business combination.***




Although
      we believe our current assets will be sufficient to allow us to consummate
      a
      business combination, in as much as we have not yet identified any prospective
      target business, we cannot ascertain the capital requirements for any particular
      transaction. If the net proceeds of our initial public offering prove to be
      insufficient, either because of the size of the business combination or the
      depletion of the available net proceeds in search of a target business, or
      because we become obligated to convert into cash a significant number of shares
      of Class B common stock from dissenting stockholders, we will be required to
      seek additional financing. We cannot assure you that such financing would be
      available on acceptable terms, if at all. To the extent that additional
      financing proves to be unavailable when needed to consummate a particular
      business combination, we would be compelled to restructure the transaction
      or
      abandon that particular business combination and seek an alternative target
      business candidate. 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 prevent or severely
      limit the continued development or growth of the target business. None of our
      officers, directors or stockholders is required to provide any financing to
      us
      in connection with or after a business combination.




19


***The
      loss of the services of any of our executive officers would make it more
      difficult to find a suitable company for a business combination which makes
      it
      more likely that we will be required to distribute the proceeds of our trust
      fund to our Class B stockholders.***




Our
      ability to effect successfully a business combination will be largely dependent
      upon the efforts of our executive officers. We have not entered into an
      employment agreement with any of our executive officers, nor have we obtained
      any “key man” life insurance on any of their lives. The loss of any or all of
      their services could have a material adverse effect on our ability to
      successfully achieve our business objectives, including seeking a suitable
      target business to effect a business combination.




***Our
      outstanding warrants and option may have an adverse effect on the market price
      of our common stock and warrants and make it more difficult to effect a business
      combination.***




We
      currently have outstanding Class W warrants to purchase 7,517,500 shares of
      common stock and Class Z warrants to purchase 6,137,500 shares of common stock.
      We also issued an option to purchase 20,000 Series A units and/or 130,000 Series
      B units to the representative of the underwriters of our initial public offering
      which, if exercised, will result in the issuance of an additional 300,000 shares
      of common stock and warrants to purchase 460,000 shares of common stock. To
      the
      extent we issue shares of common stock to effect a business combination, the
      potential for the issuance of substantial numbers of additional shares upon
      exercise of these warrants and option could make us a less attractive
      acquisition vehicle in the eyes of a target business as such securities, when
      exercised, will increase the number of issued and outstanding shares of our
      common stock and reduce the value of the shares issued to complete the business
      combination. Accordingly, our warrants and option may make it more difficult
      to
      effectuate a business combination or increase the cost of the target business.
      Additionally, the sale, or even the possibility of sale, of the securities
      underlying the warrants and option could have an adverse effect on the market
      price for our securities or on our ability to obtain future public financing.
      If
      and to the extent these warrants and option are exercised, you may experience
      dilution to your holdings.




***If
      our existing securityholders exercise their registration rights, it may have
      an
      adverse effect on the market price of our common stock and the existence of
      these rights may make it more difficult to effect a business combination.***




Our
      existing securityholders are entitled to demand that we register the resale
      of
      their 100 shares of our common stock and their 1,537,500 Class W warrants and
      1,537,500 Class Z warrants as well as the 3,075,000 shares of common stock
      underlying their Class W warrants and Class Z warrants at any time after we
      consummate a business combination. Thus, if our existing securityholders
      exercise their registration rights with respect to these securities, there
      could
      be up to an additional 100 shares of common stock and 3,075,000 warrants (or
      an
      additional 3,075,000 shares of common stock issuable upon exercise of such
      warrants) eligible for trading in the public market. The presence of this
      additional number of shares of common stock and warrants eligible for trading
      in
      the public market may have an adverse effect on the market price of our common
      stock. In addition, the existence of these rights may make it more difficult
      to
      effectuate a business combination or increase the cost of the target business,
      as the stockholders of the target business may be discouraged from entering
      into
      a business combination with us or request a higher price for their securities
      as
      a result of these registration rights and the potential future effect their
      exercise may have on the trading market for our common stock.




20


***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 c*** **omplete
      a business combination.**




If
      we are
      deemed to be an investment company under the Investment Company Act of 1940,
      we
      may be subject to certain restrictions that may make it difficult for us to
      complete a business combination, including:


·
            restrictions
                on the nature of our investments; and  ·
            restrictions
                on our issuance of securities.  In
        addition, we may have imposed upon us burdensome requirements, including:
  ·
            registration
                as an investment company;  ·
            adoption
                of a specific form of corporate structure; and  ·
            reporting,
                record keeping, voting, proxy and disclosure requirements and other
                rules
                and regulations.


We
      believe that our anticipated activities will not subject us to the Investment
      Company Act of 1940 as the net proceeds of our initial public offering that
      are
      held in trust may only be invested by the trust agent in “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.
      By restricting the investment of the trust fund 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. If we were deemed to be subject to
      the
      act, compliance with these additional regulatory burdens would require
      additional expense that we have not allotted for.




***Risks
      related to the business process services industry***




There
      are
      many risks that we will face in connection with operating a business in the
      business process services industry. If we complete a business combination in
      this industry, in addition to the risks specific to the business we acquire,
      which we cannot predict, we anticipate that our business will be subject to
      the
      following risks:




***Our
      revenues may be highly dependent on a limited number of major clients and any
      loss of business from major clients would reduce our revenues and growth.***




Some
      business process services companies derive a substantial portion of their
      revenues from a limited number of customers. If we fail to renew or extend
      contracts with major clients, or if these contracts are terminated for cause
      or
      convenience, these clients will have no further obligation to purchase services
      from us. The loss of, or any significant decline in business from, one or more
      major clients could lead to a significant decline in revenues and operating
      margins, particularly if we are unable to make corresponding reductions in
      our
      expenses in the event of any such loss or decline. We may not be able to retain
      a target business’ major clients following a business combination and if we were
      to lose any of a target business’ major clients, we may not be able to timely
      replace the revenue generated by the lost clients. In addition, the revenue
      we
      generate from major clients may decline or grow at a slower rate in future
      periods than it has in the past. If we lose any major clients, or if they reduce
      the volume of services contracted from us, we may suffer from the costs of
      underutilized capacity because of our inability to eliminate all of the costs
      associated with conducting business with them, which could exacerbate the harm
      that any such loss or reduction would have on our operating results and
      financial condition.




21


***Our
      clients may adopt technologies that decrease the demand for our services, which
      could reduce our revenues and threaten our ability to compete.***




The
      target business we acquire will depend on its customers continued need for
      its
      services, especially major clients who generate the substantial majority of
      its
      revenues. However, over time, clients may adopt new technologies that streamline
      or automate business processes. The adoption of such technologies could reduce
      the demand for our services, pressure our pricing, cause a reduction in our
      revenues and threaten our ability to compete.




***Business
      process service providers are typically highly dependent on a few industries
      and
      any decrease in demand for outsourced services in these industries could reduce
      our revenues and growth.***




Our
      major
      clients will likely concentrate in a limited number of industries. Our business
      and growth will largely depend on a continued demand for our services from
      clients in these industries and other industries we may target in the future
      and
      on trends in these industries to purchase business process services. A downturn
      in any of our target business’ industries or a slowdown or reversal of the trend
      in any of these industries to use business process service providers could
      result in a decrease in the demand for our services.




Other
      adverse changes also may lead to a decline in the demand for our services in
      the
      target business’ industries. For example, consolidation in any of these
      industries, particularly involving our clients, may decrease the potential
      number of buyers of our services. Any significant reduction in or the
      elimination of the use of the services we provide within any of these industries
      would result in reduced revenues and harm our business. Although rapid changes
      in their prospects, substantial price competition and pressure on profitability
      can encourage the use of business process service providers as a cost reduction
      measure, they may also result in increasing pressure on us from clients in
      key
      industries to lower our prices, which could result in declining operating
      results.




***The
      business process service provider industry is highly competitive and we may
      be
      unable to compete with businesses that have greater resources than we do.***




We
      expect
      to face significant competition for business process services and expect that
      competition will increase as the trend towards offshore outsourcing,
      international expansion by foreign and domestic competitors continues and
      continuing technological changes result in new and different competitors
      entering our markets. These competitors may include entrants from the financial
      services, healthcare services, media production services, communications,
      software and data networking industries or entrants in geographic locations
      with
      lower costs than those in which we operate. Many of our competitors will have
      greater financial, personnel and other resources, longer operating histories,
      more technological expertise, more recognizable brand names and more established
      relationships in industries that we may serve in the future. Increased
      competition, our inability to compete successfully against current or future
      competitors, pricing pressures or loss of market share could result in increased
      costs and reduced operating margins, which could harm our business, operating
      results, financial condition, and future prospects.




22


***Business
      process service providers often encounter long sales and implementation cycles
      and require significant resource commitments by us and our clients, which they
      may be unwilling or unable to make.***




Providing
      business process services involves significant resource commitments by us and
      our clients. Potential clients require that we expend substantial time and
      money
      educating them as to the value of our services and assessing the feasibility
      of
      integrating our systems and processes with theirs. Decisions relating to
      engaging business process service providers generally involve the evaluation
      of
      the service by our clients’ senior management and a significant number of client
      personnel in various functional areas, each having specific and often
      conflicting requirements. We may expend significant funds and management
      resources during the sales cycle and ultimately the potential client may not
      engage our services. Our sales cycle for all of our services is subject to
      significant risks and delays over which we have little or no control, including:


·
            potential
                clients’ alternatives to our services, including their willingness to
                replace their internal solutions or existing vendors;  ·
            potential
                clients’ budgetary constraints, and the timing of our clients’ budget
                cycles and approval process;  ·
            potential
                clients’ willingness to expend the time and resources necessary to
                integrate their systems with our systems and network; and  ·
            the
                timing and expiration of potential clients’ current outsourcing agreements
                for similar services.


If
      we are
      unsuccessful in closing sales after expending significant funds and management
      resources, or if we experience delays in the sales cycle, it could have a
      negative impact on our revenues and margins. The sales and implementation
      process occupies important personnel resources that could otherwise be assisting
      other new clients. Moreover, after being engaged by a client after the sales
      process, it frequently takes an additional period of time to integrate the
      client’s systems with ours, and to thereafter ramp-up our services to the
      client’s requirements.




23


***We
      may experience significant employee turnover rates and we may be unable to
      hire
      and retain enough sufficiently trained employees to support our operations,
      which could limit our ability to service clients, grow and operate profitably.***




The
      business process services industry is very labor intensive and, following a
      business combination, our success will depend on our ability to attract, hire,
      and retain qualified employees. We will compete for qualified personnel with
      companies in our target business’ industries and in other industries and this
      competition is increasing globally. Our growth requires that we continually
      hire
      and train new personnel. The business process services industry has
      traditionally experienced high employee turnover. A higher than expected
      turnover rate among our employees would increase our recruiting and training
      costs and decrease operating efficiency and productivity, and could lead to
      a
      decline in demand for our services. If this were to occur, we would be unable
      to
      service our clients effectively and this would reduce our ability to continue
      our growth and operate profitably. We may be unable to continue to recruit,
      hire, train, and retain a sufficient labor force of qualified employees to
      execute our growth strategy or meet the needs of our business.




***Our
      operations could suffer from telecommunications or technology downtime,
      disruptions or increased costs.***




Following
      the business combination, we will be highly dependent on our computer and
      telecommunications equipment and software systems. In the normal course of
      our
      business, we may need to record and process significant amounts of data quickly
      and accurately to access, maintain and expand the databases we use for our
      services. We will also be dependent on continuous availability of voice and
      electronic communication with customers. If we experience interruptions of
      our
      telecommunications network with our clients, we may experience data loss or
      a
      reduction in revenues, even if we maintain redundant systems and infrastructure.
      These disruptions could be the result of errors by our vendors, clients, or
      third parties, electronic or physical attacks by persons seeking to disrupt
      our
      operations, or the operations of our vendors, clients or others. Any failure
      of
      our vendors to perform these services could result in business disruptions
      and
      impede our ability to provide services to our clients. A significant
      interruption of service could damage our reputation and could lead our present
      and potential clients not to use our services. The temporary or permanent loss
      of equipment or systems through casualty or operating malfunction could also
      reduce our revenues and result in losses.




***We
      could cause disruptions to our clients’ business from inadequate service, and
      our insurance coverage may be inadequate to cover this risk.***




Failure
      to meet service requirements of a client could disrupt the client’s business and
      result in a reduction in revenues or a claim for substantial damages against
      us.
      In addition, a failure or inability to meet a client’s expectations could
      seriously damage our reputation and affect our ability to attract new business.
      To the extent that our contracts contain limitations on liability, such
      contracts may be unenforceable or otherwise may not protect us from liability
      for damages. While we expect to maintain general liability insurance coverage,
      including coverage for errors and omissions, this coverage may be inadequate
      to
      cover one or more large claims, and our insurer may deny coverage.




24


***Unauthorized
      disclosure of sensitive or confidential client and customer data, whether
      through breach of our computer systems or otherwise, could expose us to
      protracted and costly litigation and cause us to lose clients.***




Business
      process service providers sometimes are required to collect and store sensitive
      data in connection with their services, including names, addresses, social
      security numbers, credit card account numbers, checking and savings account
      numbers and payment history records, such as account closures and returned
      checks. If any person, including any of our employees, penetrates our network
      security or otherwise misappropriates any sensitive data that we may have,
      we
      could be subject to liability for breaching contractual confidentiality
      provisions or privacy laws. Penetration of the network security of our data
      centers could damage our reputation and could lead our present and potential
      clients to choose other service providers.




***We
      will be subject to extensive laws and regulations that could limit or restrict
      our activities and impose financial requirements or limitations on the conduct
      of our business.***




The
      business process services industry has become subject to an increasing amount
      of
      federal and state regulation in the past five years. To the extent that we
      engage in customer support or sales activities for clients, we could be subject
      to regulations governing communications with consumers. For example, the Federal
      Telemarketing and Consumer Fraud and Abuse Prevention Act of 1994 broadly
      authorizes the Federal Trade Commission to issue regulations prohibiting
      misrepresentations in telephone sales. In addition, limits on the transport
      of
      personal information across international borders such as those now in place
      in
      the European Union (and proposed elsewhere) may limit our ability to obtain
      customer data under certain circumstances.




We
      will
      also be subject to significant federal and state laws and regulations applicable
      to our accounts receivable management services, including the Fair Debt
      Collection Practices Act, which imposes significant limitations and restrictions
      on our debt collection practices including licensing requirements. These laws
      and regulations may limit our ability to recover and enforce defaulted consumer
      receivables regardless of any act or omission on our part. Additional federal,
      state, local or international legislation, or changes in regulatory
      implementation, could further limit our activities or those of our clients
      in
      the future or significantly increase the cost of regulatory compliance.




***There
      are many risks relating to restructuring operations that are beyond our control
      and could affect our ability to operate successfully.***




In
      order
      to enhance the cost-effectiveness of our operations after a business combination
      is completed, we may consider the reallocation of operating resources within
      the
      company, the relocation of labor resources, including to jurisdictions with
      more
      favorable labor rates, and the implementation of productivity technologies.
      A
      change in operating resources in the company could cause gaps in our operating
      procedures and negatively impact the company’s ability to deliver services to
      clients. We cannot be certain that any such change will ultimately produce
      any
      cost savings. Additionally, the relocation of labor resources may cause
      personnel to leave the company or be terminated and we may experience gaps
      in
      our human resource requirements, which could negatively impact our operations.




25




To
      the
      extent that the company shifts any operations or labor offshore to destinations
      with lower cost structures, we may experience negative reactions from customers,
      especially given the recent negative publicity about offshoring services to
      India and China. We cannot predict the extent of government support,
      availability of qualified workers, competition from other outsourcing companies,
      future labor rates, or monetary and economic conditions in any offshore
      locations where we may operate. Although some of these factors may influence
      our
      decision to establish operations offshore, there are inherent risks beyond
      our
      control, including exposure to currency fluctuations, wage inflation, political
      uncertainties and foreign regulatory restrictions. One or more of these factors
      or other factors relating to international operations could result in increased
      operating expenses and make it more difficult for us to manage our costs and
      operations, which could cause our operating results to decline and result in
      reduced revenues.




Additionally,
      any shift of even a portion of business operations to new facilities in a
      foreign country could result in interruptions of service, which could reduce
      our
      revenues and harm our business. The shift of operations to a facility in a
      foreign country could involve a number of logistical and technical challenges.
      We may encounter complications associated with the set-up and operation of
      business systems and computing equipment in a new facility, to the extent we
      choose to set up a new facility, as opposed to outsourcing to a cost-efficient
      foreign business services company that already has appropriate systems and
      operations in place. This could result in disruptions of services,
      notwithstanding the availability of any existing target business’ redundant
      infrastructure and systems in the United States. If such disruptions occur,
      they
      could result in financial or other damages to our clients, for which we could
      incur claims and liabilities and which could damage our reputation and cause
      us
      to lose significant business from one or more of our major clients.




***Risks
      related to potential offshore operations***




There
      are
      many risks we may face if we determine to move operations offshore following
      a
      business combination, most of which are beyond our control and could affect
      our
      ability to operate successfully. We cannot predict the extent of government
      support, availability of qualified workers, or monetary and economic conditions
      in the countries where we may operate. Although some of these factors may
      influence our decision to establish operations in a country, there are inherent
      risks beyond our control, including exposure to currency fluctuations, political
      uncertainties, foreign exchange restrictions and foreign regulatory
      restrictions. One or more of these factors or other factors relating to
      international operations could result in increased operating expenses and make
      it more difficult for us to manage our costs and operations. In addition to
      the
      foregoing, the following risks may negatively impact our operations following
      a
      business combination:




***Moving
      a portion of a target business’ operations to new facilities in a foreign
      country could result in interruptions in service and cause us to lose business
      from clients.***




We
      may
      relocate a portion of the target business’ operations to one or more foreign
      countries with significantly lower labor costs than that available in the United
      States. The relocation of operations to a facility in a foreign country will
      involve a number of logistical and technical challenges. We may encounter
      complications associated with the migration of systems and computing equipment
      to a new facility, which could result in interruptions of services. If such
      interruptions occur, they could result in financial or other damages to our
      clients, for which we could incur claims and liabilities and which could damage
      our reputation and cause us to lose significant business from one or more of
      our
      major clients.




26


***We
      may face wage inflation and additional competition in offshore markets for
      our
      professionals, which could increase the cost of qualified employees and the
      amount of employee turnover.***




To
      the
      extent we move operations to offshore markets, we will likely be faced with
      competition in these offshore markets for outsourcing center professionals,
      and
      we expect this competition to increase as additional outsourcing companies
      move
      operations offshore and expand their operations. In particular, there may be
      limited availability of qualified middle and upper management candidates. If
      such availability becomes limited due to increased competition, it could affect
      the availability or cost of qualified professionals, who are critical to our
      performance. This could increase our costs and turnover rates.




**ITEM
      1B.  UNRESOLVED STAFF COMMENTS**




Not
      applicable.




**ITEM
      2.  PROPERTIES**




We
      maintain our executive office at 3130 Fairview Park Drive, Suite 500, Falls
      Church, Virginia 22042, pursuant to an agreement with Everest Telecom LLC,
      an
      affiliate of Rahul Prakash, our Chairman of the Board and Chief Executive
      Officer. We pay Everest Telecom LLC a monthly fee of $7,500 which is for general
      and administrative services, including office space, utilities and secretarial
      support. We believe, based on rents and fees for similar services in the Falls
      Church, Virginia area, that the fee charged by Everest Telecom is at least
      as
      favorable as we could have obtained from an unaffiliated person. We consider
      our
      current office space adequate for our current operations.




**ITEM
      3.  LEGAL PROCEEDINGS**




We
      may
      from time to time be involved in legal proceedings arising from the normal
      course of business. As of the date of this report, we were not involved in
      any
      legal proceedings.




**ITEM
      4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS**




Not
      applicable.




27
 
 **PART
          II**
 
 **ITEM
          5.  MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS
          AND ISSUER PURCHASE OF EQUITY SECURITIES**


**Market
      Information**




Our
      Series A units, Series B units, common stock, Class B common stock, Class W
      warrants and Class Z warrants are traded on the Over-the-Counter Bulletin Board
      under the symbols GSPAU, GSPBU, GSPA, GSPAB, GSPAW and GSPAZ, respectively.
      The
      following table sets forth the range of high and low closing bid prices for
      the
      Series A units, Series B units, common stock, Class B common stock, Class W
      warrants and Class Z warrants for the periods indicated since the units
      commenced public trading on April 20, 2006 and since the common stock, Class
      B
      common stock, Class W warrants and Class Z warrants commenced public trading
      on
      July 14, 2006. The over-the-counter market quotations reflect inter-dealer
      prices, without retail mark-up, mark-down or commission and may not necessarily
      reflect actual transactions.




**Series
                A Units**
            
            **Series
                B Units**
            
            **Common
                Stock**
            
            **Class
                B Common Stock**
            
            **Class
                W Warrants**
            
            **Class
                Z Warrants****High**
            
            **Low**
            
            **High**
            
            **Low**
            
            **High**
            
            **Low**
            
            **High**
            
            **Low**
            
            **High**
            
            **Low**
            
            **High**
            
            **Low**Fourth
                Quarter
            
            
            9.50
            
            
            7.95
            
            
            10.80
            
            
            9.96
            
            
            —
            
            
            —
            
            
            4.77
            
            
            4.70
            
            
            0.30
            
            
            0.30
            
            
            —
            
            
            —Third
                Quarter (April 20, 2006 through April 30, 2006)
            
            
            9.55
            
            
            9.30
            
            
            10.80
            
            
            10.35
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —
            
            
            —





**Holders**




As
      of
      October 26, 2006, there were 1 holder of record of our Series A
      units, 1 holder of record of our Series B units, 2 holders of record
      of our common stock, 1 holder of record of our Class B common stock, 8
      holders of record of our Class W warrants and 8 holders of record of our Class
      Z
      warrants.




**Dividends**




We
      have
      not paid any cash dividends on our common stock to date and do not intend to
      pay
      cash dividends prior to the completion of a business combination. The payment
      of
      cash dividends in the future will be contingent upon our revenues and earnings,
      if any, capital requirements and general financial condition subsequent to
      completion of a business combination. The payment of any dividends subsequent
      to
      a business combination will be within the discretion of our then board of
      directors. It is the present intention of our board of directors to retain
      all
      earnings, if any, for use in our business operations and, accordingly, our
      board
      does not anticipate declaring any dividends in the foreseeable
      future.




**Recent
      Sales of Unregistered Securities and Use of Proceeds**




In
      August
      2005, we sold the following securities without registration under the Securities
      Act of 1933, as amended:




**Name**
            
            **Number
                of Sharesof Common Stock**
            
            **Number
                of ClassW Warrants**
            
            **Number
                of ClassZ Warrants**Rahul
                Prakash
            
            
            0
            
            
            583,710
            
            
            583,710WTP
                Capital LLC (1)
            
            
            100
            
            
            363,260
            
            
            363,260Tholons
                Capital LLC (2)
            
            
            0
            
            
            363,260
            
            
            363,260Dr.
                Brian Boyle
            
            
            0
            
            
            145,300
            
            
            145,300Atikem
                Haile-Mariam
            
            
            0
            
            
            37,260
            
            
            37,260Ravindra
                Sannareddy
            
            
            0
            
            
            37,260
            
            
            37,260Saurabh
                Srivastava
            
            
            0
            
            
            7,450
            
            
            7,450







(1)
            The
                shares and warrants are held by WTP Capital, LLC, of which Mr. Abhishek
                Jain is the Chief Executive Officer and a member. Mr. Jain exercises
                voting and disposition power over these shares and
                warrants.




(2)
            The
                warrants are held by Tholons Capital LLC, of which Mr. Avinash Vashistha
                is President and a member. Mr. Vashistha exercises voting and disposition
                power over these shares and
                warrants.




28




The
      shares of common stock, Class W and Class Z warrants were issued in connection
      with our organization pursuant to the exemption from registration contained
      in
      Section 4(2) of the Securities Act as they were sold to sophisticated, wealthy
      individuals and entities. The shares of common stock were sold at a purchase
      price of $5.00 per share for $500 and the Class W and Class Z warrants were
      sold
      at a purchase price of $0.05 per warrant for $153,750.




**Initial
      Public Offering**




On
      April
      25, 2006, we consummated our initial public offering of 460,000 Series A units,
      with each Series A unit consisting of two shares of our common stock and ten
      Class Z warrants, each Class Z warrant to purchase one share of our common
      stock
      at an exercise price of $5.00 per share, and 2,990,000 Series B units, with
      each
      Series B unit consisting of two shares of our Class B common stock and two
      Class
      W Warrants, each Class W Warrant to purchase one share of our common stock.
      This
      included the full exercise of the over-allotment option. The Series A units
      were
      sold at an offering price of $8.50 per Series A unit and the Series B units
      were
      sold at an offering price of $10.10 per Series B unit, generating total gross
      proceeds of $34,109,000. HCFP/Brenner Securities LLC acted as representative
      of
      the underwriters of our initial public offering. The securities sold in the
      offering were registered under the Securities Act of 1933 on a registration
      statement on Form S-1 (No. 333-128350). The Securities and Exchange Commission
      declared the registration statement effective on April 18, 2006.




We
      paid a
      total of $2,046,540 in underwriting discounts and commissions and approximately
      $485,000 for other costs and expenses related to the offering. After deducting
      the underwriting discounts and commissions and the offering expenses, the total
      net proceeds to us from the offering were approximately $31,577,000 of which
      $30,199,000 was deposited into the trust fund and the remaining proceeds
      $1,378,000 became available to be used to provide for business, legal and
      accounting due diligence on prospective business combinations and continuing
      general and administrative expenses. The net proceeds deposited into the trust
      fund remain on deposit in the trust fund and have earned $250,626 in interest
      through July 31, 2006.




**ITEM
      6.  SELECTED FINANCIAL DATA**




The
      following tables should be read in conjunction with our financial statements
      and
      the notes thereto appearing elsewhere in this Annual Report on Form 10-K.
      The selected financial data has been derived from our financial statements,
      which have been audited by BDO Seidman, LLP, independent registered public
      accounting firm, as indicated in their report included elsewhere herein.


**From
                  Inception (August 10, 2005) to July 31, 2006****Statement
                  of Operations Data:**Loss
                  from operations
              
              $
              (105,459
              )Interest
                  income
              
              
              258,916Net
                  income
              
              
              153,457Accretion
                  of Trust Fund relating to Class Bcommon
                  stock subject to possible conversion
              
              
              (50,100
              )Net
                  income attributable to other Class B stockholdersand
                  common stockholders
              
              
              103,357*Earnings
                  per share data:*Weighted
                  average Class B common shares outstandingsubject
                  to possible conversion
              
              
              329,071Net
                  income per Class B common share subject to possibleconversion,
                  basic and diluted
              
              $
              0.15Weighted
                  average number of shares outstanding, basic and diluted
              
              
              1,570,467Net
                  income per share, basic and diluted
              
              $
              0.07**Other
                  Financial Data:**Net
                  cash used in operating activities
              
              $
              (59,069
              )Cash
                  contributed to trust fund
              
              
              (30,199,000
              )Net
                  proceeds from public offering allocable tostockholders'
                  equity
              
              
              25,650,850Portion
                  of net proceeds from public offering allocable toCommon
                  Stock subject to possible conversion
              
              
              6,036,780
 **Selected
                  Balance Sheet Data:**
              
              **July
                  31, 2006**Cash
                  and cash equivalents
              
              $
              1,583,911Trust
                  fund
              
              
              30,449,626Net
                  working capital (a)
              
              
              1,455,902Total
                  assets
              
              
              32,037,662Common
                  stock, subject to possible conversion
              
              
              6,086,880Total
                  stockholders' equity
              
              
              25,818,648
 
 (a)
        Excludes restricted investments held in Trust




29


**ITEM
      7.  MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
      RESULTS OF OPERATIONS:**




The
      following discussion should be read in conjunction with our financial statements
      and footnotes thereto contained in this report.




**General**




We
      were
      formed on August 10, 2005 to serve as a vehicle to effect a merger, capital
      stock exchange, asset acquisition or other similar business combination with
      an
      entity that has an operating business. We completed our initial public offering
      (“IPO”) April 25, 2006. Our entire activity from inception through the
      consummation of our IPO was to prepare for and complete our IPO, and since
      the
      consummation of our IPO, our activity has been limited. However, we have
      assembled a list of potential target companies with which to conduct a potential
      business combination and have initiated discussions with several such companies.
      We have not yet entered into any letters of intent, arrangements or agreements
      with any such companies with respect to a business combination.




We
      are
      currently continuing the process of evaluating and identifying targets for
      a
      business combination. We are not presently engaged in, and will not engage
      in,
      any substantive commercial business until we consummate a business combination.
      We intend to utilize cash derived from the proceeds of our IPO, our capital
      stock, debt or a combination of cash, capital stock and debt, in effecting
      a
      business combination.




For
      a
      description of the proceeds generated in our IPO and a discussion of the use
      of
      such proceeds, we refer you to Notes 1 and 2 of the financial statements
      included in Part II, Item 8 of this Form 10-K.




**Results
      of Operations**




Net
      income for the period from inception (August 10, 2005) to July 31, 2006 of
      $153,457 consisted of interest income on the Trust Fund investment of $250,626
      and interest on cash and cash equivalents of $8,290, offset by professional
      fees
      of $64,424 and general and administrative expenses of $41,035 which is comprised
      of $25,725 for a monthly administrative services agreement with an affiliate,
      $10,056 for Delaware franchise tax and $5,254 for other expenses.




**Liquidity
      and Capital Resources**




Our
      net
      proceeds from the IPO, after deducting offering expenses of approximately
      $485,000 and underwriting discounts of approximately $2,047,000, was
      approximately $31,577,000 of which $30,199,000 was placed in a trust account
      and
      the remaining proceeds of approximately $1,378,000 became available to be used
      to provide for business, legal and accounting due diligence on prospective
      transactions and continuing general and administrative expenses. We expect
      to
      use substantially all of the net proceeds of our initial public offering to
      acquire a target business, including identifying and evaluating prospective
      acquisition candidates, selecting the target business, and structuring,
      negotiating and consummating the 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, as well as any other net
      proceeds not expended, will be used to finance the operations of the target.
      At
      July 31, 2006, we had cash and cash equivalents of $1,583,911, investment in
      the
      trust account of $30,449,626, prepaid expenses of $4,125 and total liabilities
      of $132,134.




30


We
      believe that the funds available to us outside of the trust account will be
      sufficient to allow us to operate until April 25, 2008, assuming that a business
      combination is not consummated during that time. Of the funds held outside
      of
      the trust account totaling $1,583,911 as of July 31, 2006, we anticipate using
      these funds to cover legal and accounting fees, other expenses attendant to
      the
      due diligence investigations, structuring, and negotiating of a business
      combination, and administrative expenses incurred prior to completing a business
      combination. We do not believe we will need to raise additional funds in order
      to meet the expenditures required for operating our business. However, we may
      need to raise additional funds through a private offering of debt or equity
      securities if such funds are required to consummate a business combination
      that
      is presented to us. We would only consummate such a fund raising simultaneously
      with the consummation of a business combination.




In
      August
      2005, we issued $52,500 of non-interest bearing notes to our initial
      securityholders. The notes were repaid in full during May and June 2006, from
      the proceeds of the offering.




**Off-Balance
      Sheet Arrangements**




As
      of
      July 31, 2006 we did not have any off-balance sheet arrangements as defined
      in
      Item 303(a)(4)(ii) of Regulation S-K.




**Contractual
      Obligations and Commitments**




Our
      contractual obligations are set forth in the following table as of July 31,
      2006:





**Payment
                  due by period****ContractualObligations**
              
              **Total**
              
              **Less
                  than 1 year**
              
              **1-3**
                **years**
              
              **3-5**
                **years**
              
              **More
                  than**
                **5
                  years**Administrativeservices
                      agreement(1)
              
              $
              153,750
              
              $
              90,000
              
              $
              63,750
              
              
              -
              
              
              -Total
              
              $
              153,750
              
              $
              90,000
              
              $
              63,750
              
              $
              -
              
              $
              -







(1)
      We
      are obligated, having commenced April 18, 2006, to pay to Everest Telecom LLC,
      an affiliate of Mr. Rahul Prakash, our Chairman of the Board and Chief Executive
      Officer and a member of our board of directors, a monthly fee of $7,500 for
      office and administrative services. This arrangement is for our benefit and
      is
      not intended to provide compensation in lieu of a salary. An amount of $25,725
      is included in general and administrative expenses on the accompanying statement
      of operations for the period from Inception (August 10, 2005) to July 31, 2006,
      pursuant to this arrangement.




If
      we do
      not complete a business combination by October 25, 2007, or April 25, 2008
      if
      certain extension criteria have been satisfied, we will distribute to all of
      our
      Class B stockholders, in proportion to their respective equity interests in
      the
      Class B common stock, an aggregate sum equal to the amount in the Trust Fund,
      inclusive of any interest, and all then outstanding Class B common stock will
      be
      automatically cancelled. There will be no distribution from the Trust Fund
      with
      respect to our common stock or our Class W and Class Z warrants. However, any
      remaining net assets following the distribution of the Trust Fund will be
      available for our use to pay any creditors and to effect our dissolution and
      liquidation. The distribution per Class B share, taking into account interest,
      earned on the trust fund, is approximately $5.09 per share based on the value
      in
      the trust fund as of July 31, 2006.




31


**Critical
      Accounting Policies**




Investments
      Held in Trust - The restricted investment held in the Trust Fund at July 31,
      2006 is comprised of Commonwealth of Virginia securities with maturities of
      up
      to 30 days. Such securities generate current income which is exempt from federal
      income tax and the income tax imposed by the Commonwealth of Virginia and
      therefore no provision for income taxes is required for the period ended July
      31, 2006.




Fair
      Value of Financial Instruments and Derivatives - The fair values of our assets
      and liabilities that qualify as financial instruments under SFAS No. 107
      approximate their carrying amounts presented in the balance sheet at July 31,
      2006.




We
      account for derivative instruments in accordance with SFAS No. 133 “Accounting
      for Derivative Instruments and Hedging Activities,” as amended, (“SFAS 133”)
      which establishes accounting and reporting standards for derivative instruments
      and hedging activities, including certain derivative instruments imbedded in
      other financial instruments or contracts and requires recognition of all
      derivatives on the balance sheet at fair value. Accounting for the changes
      in
      the fair value of the derivative instruments depends on whether the derivatives
      qualify as hedge relationships and the types of the relationships designated
      are
      based on the exposures hedged. Changes in the fair value of derivative
      instruments which are not designated as hedges are recognized in earnings as
      other income (loss).




**ITEM
      7A.  QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET
      RISKS**




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
      July 31, 2006, $30,449,626 of the net proceeds of our initial public offering
      (including interest) was held in trust for the purposes of consummating a
      business combination. The proceeds held in trust have been invested in a money
      market fund at Lehman Brothers Inc. which invests in United States Treasury
      Bills, commercial paper and other money market instruments. Lehman Brothers
      Inc.
      also acts as trustee. As of July 31, 2006, the effective annualized interest
      rate payable on our investment was 3.2%.




We
      have
      not engaged in any hedging activities since our inception on August 10, 2005.
      We
      do not expect to engage in any hedging activities with respect to the market
      risk to which we are exposed.




32


**ITEM
      8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA**




The
      Company’s financial statements, the related notes, the Independent Auditors’
Report thereon, Management’s Report on Internal Control Over Financial Reporting
      and the Independent Auditors’ Report on internal control over financial
      reporting are included in our 2006 Financial Statements and are filed as a
      part
      of this report on page F-1 following the signatures.




**ITEM
      9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
      FINANCIAL DISCLOSURE**




There
      were no changes in or disagreements with accountants on accounting and financial
      disclosure.




**ITEM
      9A.  CONTROLS AND PROCEDURES**




Our
      management, with the participation of our Chief Executive Officer and Chief
      Financial Officer, evaluated the effectiveness of our disclosure controls and
      procedures as of July 31, 2006. The term “disclosure controls and procedures,”
as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act
      of
      1934 (the “Exchange Act”), means controls and other procedures of a company that
      are designed to ensure that information required to be disclosed by a company
      in
      the reports that it files or submits under the Exchange Act is recorded,
      processed, summarized and reported, within the time periods specified in the
      SEC’s rules and forms. Disclosure controls and procedures include, without
      limitation, controls and procedures designed to ensure that information required
      to be disclosed by a company in the reports that it files or submits under
      the
      Exchange Act is accumulated and communicated to the company’s management,
      including its principal executive and principal financial officers, as
      appropriate to allow timely decisions regarding required disclosure. Management
      recognizes that any controls and procedures, no matter how well designed and
      operated, can provide only reasonable assurance of achieving their objectives
      and management necessarily applies its judgment in evaluating the cost-benefit
      relationship of possible controls and procedures.




As
      required by Rules 13a-15 and 15d-15 under the Exchange Act, our chief executive
      officer and chief financial officer carried out an evaluation of the
      effectiveness of the design and operation of our disclosure controls and
      procedures as of July 31, 2006. Based upon their evaluation, they concluded
      that
      our disclosure controls and procedures were effective.




**CHANGES
      IN INTERNAL CONTROL OVER FINANCIAL REPORTING**




There
      has
      been no change in our internal control over financial reporting during the
      fourth fiscal quarter ended July 31, 2006 that has materially affected, or
      is
      reasonably likely to materially affect, our internal control over financial
      reporting.




**ITEM
      9B.  OTHER INFORMATION:**




Not
      applicable.




33


**PART
      III**




**ITEM
      10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT:**




**MANAGEMENT**




Our
      current directors, executive officers and senior advisors are as follows:




**Name**
            
            **Age**
            
            **Position**Rahul
                Prakash
            
            45
            
            Chairman
                of the Board and Chief Executive OfficerAbhishek
                Jain
            
            38
            
            President,
                Secretary and DirectorAvinash
                Vashishtha
            
            45
            
            Executive
                Vice President, Chief Financial Officer and DirectorDr.
                Brian Boyle
            
            58
            
            DirectorAtikem
                Haile-Mariam
            
            41
            
            Senior
                AdvisorRavindra
                Sannareddy
            
            43
            
            Senior
                AdvisorSaurabh
                Srivastava
            
            60
            
            Senior
                Advisor





***Rahul
      Prakash*** has been
      our Chairman of the Board and Chief Executive Officer since our inception.
      Mr.
      Prakash has served as the President and Chief Executive Officer of Everest
      Telecom LLC, a private investment firm that invests and manages investments
      in
      business services, software services, telecommunications and related businesses,
      since he founded that company in April 2002. In May 2006 Mr. Prakash formed
      served as President of Everest Telecom Management LLC, a company that makes
      private investments. Since March 2005, he also has served as the Chairman of
      the
      Board of Softscribe, a business process services company based in India, and
      since February 2005, has served as the Chairman of the Board of Everest
      Services, a software outsourcing firm, both of which are portfolio companies
      of
      Everest Telecom. From 1994 to 1997, Mr. Prakash was Vice President of Telcom
      Ventures, a private equity firm, and thereafter served as that company’s
      President from 1997 to September 2002. During his tenure, Telcom was an early
      investor in: XM Satellite Radio Holdings, Inc., a Nasdaq listed company; Aether
      Holdings, Inc., a Nasdaq listed company; Teligent, Inc., which was formerly
      a
      Nasdaq listed company; Mobile Satellite Ventures; Ubiquitel PCS, an affiliate
      of
      Sprint Corp., a New York Stock Exchange listed company; and BPL Mobile, a
      cellular operator in India, among others. Under Mr. Prakash’s leadership, Telcom
      also invested in Wireless Ventures of Brazil and Wireless Ventures of Argentina,
      which were collectively acquired in 1997 by Nextel Partners, Inc., a Nasdaq
      listed company. During his tenure at Telcom, Mr. Prakash served on the boards
      of
      two publicly-traded portfolio companies, Aether (from 1996 to June 2001), and
      Teligent (from May 2001 to September 2002). From 1991 to 1997, Mr. Prakash
      was
      employed with LCC International, Inc., a Nasdaq listed telecommunications
      company, as Vice President and Special Advisor to the Chairman. While at LCC,
      Mr. Prakash also served as Head of Business Development for Telemate, a joint
      venture of France Telecom and LCC International based in Paris (from 1993 to
      1994). Mr. Prakash was a founding board member of the Indian CEO Council of
      the
      U.S., an organization of senior executive entrepreneurs, serving from 1996
      until
      March 2005. Mr. Prakash received a B.A. with honors and an M.B.A. from Delhi
      University and an M.B.A. from American University.




***Abhishek
      Jain*** has been
      our President and a member of our Board of Directors since our inception. Mr.
      Jain has been the Chief Executive Officer of WTP Capital, LLC, a private equity
      firm, since December 2004, and Chief Executive Officer of Washington Technology
      Partners, Inc., an affiliated private equity firm, since 2000. Both WTP Capital
      and Washington Technology Partners focus on investments in the business services
      sector using principles of international labor-rate arbitrage (i.e.,
      capitalizing on lower labor costs in different international locations). In June
      2006, Mr. Jain became the Chairman of Vigilar, one of WTP Capital’s portfolio
      companies. From January 2003 to July 2003, Mr. Jain was President of Megasoft
      Limited, a Bombay Stock Exchange listed software solutions company. In 1998,
      Mr.
      Jain was a founding partner in the law firm of Jones Jain LLP, a corporate
      law
      firm, and remained a partner at that firm until September 2000, when it was
      acquired by Greenberg Traurig, another corporate law firm. From 1995 to 1998,
      he
      was an attorney at Jones, Day, Reavis & Pogue, a corporate law firm, and
      from 1994 to 1995 he was an attorney at Holland & Knight, a corporate law
      firm. From 1996 to September 2000, Mr. Jain served as counsel to the Embassy
      of
      India in the U.S. Mr. Jain was a Governor-appointed member of the board of
      the
      Virginia Biotechnology Research Park Authority, a public entity that governs
      Virginia’s biotechnology parks, from June 2001 to June 2005. Mr. Jain was
      Co-President and board member of the Indian CEO Council from March 2002 to
      March
      2005. Mr. Jain received a B.S., cum laude, from Towson State University and
      a
      J.D. from the University of Maryland School of Law.




34


***Avinash
      Vashistha*** has been
      our Executive Vice President, Chief Financial Officer and a member of our Board
      of Directors since our inception. In February 2006, Mr. Vashistha founded
      Tholons, Inc., a business process services industry advisory firm, and since
      its
      inception, Mr. Vashistha has served as Tholons’ Chairman and Chief Executive
      Officer. From 2000 until February 2006, Mr. Vashistha served as a Managing
      Partner, Director and Chairman of neoIT, a company he co-founded, and also
      served as its Managing Director for Asia-Pacific operations. neoIT is an
      advisory and management firm that advises clients regarding offshore IT and
      business services. In his roles at neoIT, Mr. Vashistha directly assisted
      clients in outsourcing more than $2 billion of business and IT services
      offshore. Since December 2004, Mr. Vashistha has also been the President and
      a
      member of Tholons Capital LLC, a private equity firm. Mr. Vashistha co-authored
      the book, The
      Offshore Nation ,
      published by McGraw-Hill, and lectures on globalization in international media
      and industry forums. From 1996 to 2000, Mr. Vashistha worked for Nortel
      Corporation, a New York Stock Exchange listed communications equipment
      manufacturer, where he served as Director of International Research and
      Development Operations (India). In this capacity, Mr. Vashistha established
      and
      headed Nortel’s Indian outsourcing operations, which was comprised of more than
      1,500 personnel. From 1992 to 1996, as Director of European Delivery (U.K.)
      for
      Nortel, Mr. Vashistha led the design, development, deployment and support of
      large telecommunications networks for major U.K. and European clients. Mr.
      Vashistha also initiated offshoring work for Nortel to Vietnam, Turkey, Ireland,
      Israel, Russia and India. From 1990 to 1991, Mr. Vashistha was a Senior Manager
      with Nortel in the U.S., responsible for network management, client solutions,
      deployment and support. Prior to working at Nortel, Mr. Vashistha worked with
      AT&T, Verizon and Lucent in the U.S., designing and creating telecom,
      network, and enterprise client solutions. Mr. Vashistha received a B.Tech.
      from
      the Indian Institute of Technology in Kanpur, India, an M.S. from the University
      of Alberta, Canada and an M.B.A. from the University of Phoenix.




***Dr.
      Brian Boyle*** has been
      a member of our Board of Directors since our inception. Since September 2003,
      Dr. Boyle has served as Chief Executive Officer of Strategitec International
      Ltd., a private company that provides dedicated offshore outsourcing services
      to
      U.S. companies seeking to reduce development costs and increase quality. Dr.
      Boyle also has served, since 1996, as Vice Chairman of Boston Communications
      Group, Inc., a Nasdaq listed provider of access management, billing, payment
      and
      network solution services, and has held various other positions since joining
      that company in 1994. Since 1995, Dr. Boyle has served as a Director and
      Chairman Emeritus of MicroFinancial Incorporated, a New York Stock Exchange
      listed provider of lease and financing services, formerly known as Boyle Leasing
      Technologies. Dr. Boyle was the Chief Executive Officer of MicroFinancial from
      1985 to 1987 and was its Chairman of the Board from 1985 to 1995. Additionally,
      Dr. Boyle has been a Director of Abt Associates Inc., a government and business
      research and consulting firm, since 1996. Since 1985, Dr. Boyle has been a
      Director of DentAMed Inc., a health care finance company providing consumer
      funding for medical care. From 1999 to March 2003, Dr. Boyle was Chairman of
      the
      Board and Chief Executive Officer of GoldK, Inc., a retirement plan platform
      company focused on using the Internet to create, manage, distribute and support
      retirement plans. From 1989 to 1993, Dr. Boyle was Chief Executive Officer
      of
      Credit Technologies, Inc. (now Lightbridge, a Nasdaq listed company), a provider
      of credit decision, fraud prevention and customer acquisition software and
      services to the wireless industry, which he founded in 1989. From 1986 to 1996,
      Dr. Boyle was a general partner of BEB I/BEB II Limited Partnerships, which
      were
      start-up-focused investment funds. From 1984 to 1990, Dr. Boyle was Chief
      Executive Officer of Appex, Inc., a provider of billing software, MIS systems
      and roaming network and clearinghouse services for the cellular industry that
      was acquired by Electronic Data Systems in 1990. In 1974, Dr. Boyle founded
      Interactive Management Systems, Inc., a software products firm, where he served
      as President and Chief Executive Officer until it was acquired in 1981 by a
      company now owned by GTE. Dr. Boyle left Interactive Management Systems in
      1983.
      Dr. Boyle received an A.B. from Amherst College and a B.S., M.S., E.E. and
      Ph.D.
      from Massachusetts Institute of Technology.




35


***Atikem
      Haile-Mariam*** has
      served as a Senior Advisor to us since August 2005. Since June 2003, Mr.
      Haile-Mariam has been the founding director of Glob-T, an international telecom
      and outsourcing consulting group. From July 2004 to May 2005, he worked as
      a
      venture investment consultant for International Finance Corporation/World Bank’s
      Global IT Investments Division, where he advised the International Finance
      Corporation on investments in the business process outsourcing sector and
      investment in the Asia-Pacific region. In January 2001, Mr. Haile-Mariam
      co-founded Ignis Inc., a telecom component manufacturer, and served as its
      Vice
      President of Marketing and Business Development from its founding until January
      2003, when Ignis was acquired by Bookham Inc., a Nasdaq listed company. From
      1999 to January 2001, Mr. Haile-Mariam was a member of Intel Capital
      Corporation’s investment organization and supervised that company’s investments
      in communications related entities. From 1992 to 1998, Mr. Haile-Mariam held
      several management positions within the communications group of Corning Inc.
      Mr.
      Haile-Mariam received a B.A. from Knox College, a B.S. from Washington
      University in St. Louis and an M.B.A. from The Darden School at the University
      of Virginia.




***Ravindra
      Sannareddy*** has
      served as a Senior Advisor to us since August 2005. Since its founding in 1994,
      Mr. Sannareddy has served as Chairman of the Board of Megasoft Limited, a Bombay
      Stock Exchange listed software solutions company. From 1994 to 1998, Megasoft
      managed, on an outsource basis, the U.S. software services division for Satyam
      Computer Services Limited, a New York Stock Exchange listed computer services
      and consulting firm. Mr. Sannareddy was employed with ICF Consulting, an
      engineering and energy-consulting organization, from 1990 to 1994, in different
      capacities. Mr. Sannareddy received a B.S. from Regional Engineering College
      in
      Trichy, India, a B.S. from Utah State University and an M.S.E. from The Johns
      Hopkins University.




36


***Saurabh
      Srivastava*** has
      served as a Senior Advisor to us since August 2005. Since 1998, Mr. Srivastava
      has been the Chairman of the Board of Xansa India Pvt. Ltd., an international
      business process and IT services company. Since March 2006, Mr. Srivastava
      has
      been a member of the board of directors of East India Company Acquisition Corp.,
      a blank check company formed with the purpose of effecting a merger, capital
      stock exchange, asset acquisition or other similar business combination with
      an
      operating business that has operations in India. Since 1998, Mr. Srivastava
      also
      has been a Director of Xansa plc, a London Stock Exchange listed (a UK FTSE
      250
      company) provider of international business processes and IT services. In 1989,
      Mr. Srivastava founded IIS Infotech Limited, a software services and consulting
      company, and served as that company’s Chairman of the Board from its inception
      until it was acquired by Xansa in 1998. In 1988, Mr. Srivastava co-founded
      the
      National Association of Software Services Companies (NASSCOM), India’s software
      industry association, for which he served as Chairman from 1997 to 1998 and
      as
      Chairman Emeritus from 1999 to the present. Since April 2002, Mr. Srivastava
      has
      been a member of the Venture Capital Committee of the Securities and Exchange
      Board of India. Since 2000, Mr. Srivastava has been Chairman of the Indian
      Venture Capital Association, an organization of venture capital funds in India,
      whose mission is to facilitate growth of venture capital and private equity
      in
      India. From 2000 until September 2002, Mr. Srivastava was also a member of
      the
      Screening Committee, OTCEI (Over-the-Counter Exchange of India). Since 1999,
      he
      has been a founder and Chairman of Infinity, India’s first angel venture capital
      fund. Mr. Srivastava has also been a member of the Investment Committee of
      the
      Indian Government’s National Venture Capital Fund since October 2002. From 1997
      to 1998, Mr. Srivastava was Chairman of the Information Technology Committee
      of
      FICCI (Federation of Indian Chambers of Commerce and Industry). Mr. Srivastava
      received a B.Tech. from the Indian Institute of Technology in Kanpur, India,
      and
      an M.S. from Harvard University.




Our
      board
      of directors is divided into three classes with only one class of directors
      being elected in each year and each class serving a three-year term. The term
      of
      office of the first class of directors, consisting of Avinash Vashistha, will
      expire at our first annual meeting of stockholders. The term of office of the
      second class of directors, consisting of Abhishek Jain, will expire at the
      second annual meeting. The term of office of the third class of directors,
      consisting of Dr. Brian Boyle and Rahul Prakash, will expire at the third annual
      meeting.




We
      do not
      have an audit committee of our Board of Directors nor do we have an audit
      committee financial expert, because we do not believe the nature of our business
      is such that an audit committee or audit committee financial expert would be
      useful or necessary. Furthermore, our equity securities are not listed on an
      exchange or automated quotation system that requires its listed companies to
      appoint an audit committee.




We
      have
      not adopted a Code of Ethics that applies to our principal executive officer
      or
      principal financial officer, or persons performing similar functions, primarily
      because we do not and will not have any operations until such time as we enter
      into a business combination. We intend to adopt a Code of Ethics at or prior
      to
      such time as we enter into a business combination.




37


**Conflicts
        of Interest**
  Holders
        of our securities 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 management
        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.
        They may have conflicts of interest in determining to which entity a particular
        business opportunity should be presented.
  ·  Saurabh
        Srivastava, one of our special advisors, recently became a director of East
        India Company Acquisition Corp., a structured blank check company the purpose
        of
        which is to complete a business combination with an operating business that
        derives the majority of its revenues from operations in India or that has
        a
        majority of its assets located in India. As of the date hereof, East India
        Company Acquisition Corp. has not yet completed its initial public offering.
        Mr.
        Srivastava does not receive any salary for his services to East India Company
        Acquisition Corp. Mr. Srivastava has purchased 75,000 shares of common stock
        of
        East India Company Acquisition Corp. at a purchase price of approximately
        $0.0167 per share for $1,252.50. Our officers, directors and special advisors
        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.
  ·  Our
        directors own warrants that are subject to lock-up agreements restricting
        their
        sale until a business combination is successfully completed. Accordingly,
        our
        board may have a conflict of interest in determining whether a particular
        target
        business is appropriate to effect a business combination. Additionally, such
        individuals may purchase units in the offering and in the open market. If
        such
        individuals purchase Series B units in this offering or in the open market
        or
        Class B common stock in the open market, they would be entitled to vote as
        they
        choose on a proposal to approve a business combination and exercise conversion
        rights in connection therewith. These individuals may not have the same
        interests as other Class B common stockholders.
  ·  Our
        directors and officers may enter into consulting or employment agreements
        with
        the company as part of a business combination pursuant to which they may
        be
        entitled to compensation for their services following the business combination.
        The personal and financial interests of our directors and officers may influence
        their motivation in identifying and selecting a target business, and completing
        a business combination in a timely manner.
  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.


38


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. If any of these
      conflicts are not resolved in our favor, it may diminish our ability to complete
      a favorable business combination.




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
      earlier of a business combination or the distribution of the trust fund to
      the
      Class B stockholders, or such time as he ceases to be an officer or director,
      to
      present to our company for our consideration, prior to presentation to any
      other
      entity, any suitable business opportunity which may reasonably be required
      to be
      presented to us subject to any pre-existing fiduciary or contractual obligations
      he might have.




Mr.
      Jain
      has a pre-existing fiduciary obligation to WTP Capital, LLC and its affiliate,
      Washington Technology Partners, Inc. (collectively, “WTP”). However, the
      investment focus of WTP is substantially smaller than our focus, and it is
      not
      anticipated that WTP would target business combinations as large as we will
      target. Accordingly, we believe that any potential for a conflict of interest
      due to this pre-existing obligation is minimal.




Mr.
      Srivastava is member of the board of directors of East India Company Acquisition
      Corp., a blank check company. East India Company Acquisition Corp.’s objective
      is to effect a merger, capital stock exchange, asset acquisition or other
      similar business combination with an operating business that derives the
      majority of its revenues from operations in India or that has a majority of
      its
      assets located in India. As of the date of this report, East India Company
      Acquisition Corp. has not completed its initial public offering. Mr. Srivastava
      does not receive any salary for his services to East India Company Acquisition
      Corp. Mr. Srivastava has purchased 75,000 shares of common stock of East India
      Company Acquisition Corp. at a purchase price of approximately $0.0167 per
      share
      for $1,252.50.




To
      further minimize potential conflicts of interest, we have agreed not to
      consummate a business combination with an entity which is affiliated with any
      of
      our existing securityholders unless we obtain an opinion from an independent
      investment banking firm that the business combination is fair to our
      stockholders from a financial point of view.




**SECTION
      16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE:**




Section
      16(a) of the Securities Exchange Act of 1934 requires certain officers and
      directors of Global Services Partners Acquisition Corp., and any persons who
      own
      more than ten-percent of the common stock outstanding to file forms reporting
      their initial beneficial ownership of shares and subsequent changes in that
      ownership with the Securities and Exchange Commission and the NASDAQ Stock
      Market. Officers and directors of Global Services Partners Acquisition Corp.,
      and greater than ten-percent beneficial owners are also required to furnish
      the
      Company with copies of all such Section 16(a) forms they file. Based solely
      on a
      review of the copies of the forms furnished to the Company, or written
      representations from certain reporting persons that no Forms 5 were required,
      the Company believes that during the 2006 fiscal year we complied with all
      section 16(a) filing requirements.




39


**ITEM
      11.  EXECUTIVE COMPENSATION**




Commencing
      on April 25, 2006 and ending upon the acquisition of a target business,
      we  are
      obligated to pay Everest Telecom LLC a fee of $7,500 per month for providing
      us
      with office space and certain office and secretarial services. Everest Telecom
      is an affiliate of Rahul Prakash our Chief Executive Officer and Chairman of
      our
      board of directors. Other than this $7,500 per-month fee, no compensation of
      any
      kind, including finders and consulting fees, will be paid to any of our founders
      or any of their respective affiliates, prior to, or for any services they render
      in order to effectuate, the consummation of a business combination. However,
      our
      founders 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.




Since
      our
      formation, we have not granted any stock options or stock appreciation rights
      or
      any awards under long-term incentive plans.




**ITEM
      12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
      AND RELATED STOCKHOLDERS**




·
            The
                following table sets forth information regarding the beneficial ownership
                of our common stock and Class B common stock as of October 30, 2006,
                by:




·
            each
                person known by us to be the beneficial owner of more than 5% of
                our
                outstanding shares of common stock;




·
            each
                of our officers, directors and senior advisors; and




·
            all
                our officers and directors as a group.




Unless
      otherwise indicated, we believe that all persons named in the table have sole
      voting and investment power with respect to all shares of common stock
      beneficially owned by them.




**Common
                Stock**
            
            **Class
                B Common Stock****Name
                and Address**
              **of
                Beneficial Owner**(1)
            
            **Amount
                and Nature of Beneficial Ownership**
            
            **Percent**
            
            **Amount
                and Nature of Beneficial Ownership**
            
            **Percent**Rahul
                Prakash
            
            0
            (2)
            *
            
            —
            
            —Abhishek
                Jain
            
            100
            (3)
            *
            
            —
            
            —Avinash
                Vashistha
            
            0
            (4)
            *
            
            —
            
            —Dr.
                Brian Boyle
            
            0
            (5)
            *
            
            —
            
            —Atikem
                Haile-Mariam(6)
            
            0
            (7)
            *
            
            —
            
            —Ravindra
                Sannareddy(8)
            
            0
            (7)
            *
            
            —
            
            —Saurabh
                Srivastava(9)
            
            0
            (10)
            *
            
            —
            
            —




40


**Common
                Stock**
            
            **Class
                B Common Stock****Name
                and Address**
              **of
                Beneficial Owner**(1)
            
            **Amount
                and Nature of Beneficial Ownership**
            
            **Percent**
            
            **Amount
                and Nature of Beneficial Ownership**
            
            **Percent**Sapling
                LLC(11)
            
            —
            
            —
            
            441,841(12)
            
            7.4%Fir
                Tree Recovery Master Fund, L.P.(13)
            
            —
            
            —
            
            144,159(12)
            
            2.4%Fir
                Tree, Inc.(14)
            
            —
            
            —
            
            586,000(12)
            
            9.8%All
                executive officers and directors as  a group (4
                persons)
            
            0
            (15)
            *
            
            —
            
            —







*
      Less
      than 1%.




(1)
            Unless
                otherwise noted, the business address of each of the following is
                3130
                Fairview Park Drive, Suite 500, Falls Church, Virginia 22042.




(2)
            Does
                not include 1,167,420 shares of common stock issuable upon exercise
                of
                Class W warrants and Class Z warrants which are not exercisable and
                will
                not be exercisable within the next 60 days.




(3)
            Does
                not include 726,520 shares of common stock issuable upon exercise
                of Class
                W warrants and Class Z warrants which are not exercisable and will
                not be
                exercisable within the next 60 days. The shares and warrants are
                held by
                WTP Capital, LLC, of which Mr. Jain is the Chief Executive Officer
                and a
                member. Mr. Jain exercises voting and disposition power over these
                shares
                and warrants.




(4)
            Does
                not include 726,520 shares of common stock issuable upon exercise
                of Class
                W warrants and Class Z warrants which are not exercisable and will
                not be
                exercisable within the next 60 days. The warrants are held by Tholons
                Capital LLC, of which Mr. Vashistha is President and a member. Mr.
                Vashistha exercises voting and disposition power over these shares
                and
                warrants.




(5)
            Does
                not include 290,600 shares of common stock issuable upon exercise
                of Class
                W warrants and Class Z warrants which are not exercisable and will
                not be
                exercisable within the next 60 days.




(6)
            The
                address of Mr. Haile-Mariam is 903 Oakes Street, East Palo Alto,
                CA
                94303.




(7)
            Does
                not include 74,520 shares of common stock issuable upon exercise
                of Class
                W warrants and Class Z warrants which are not exercisable and will
                not be
                exercisable within the next 60 days.




(8)
            The
                address of Mr. Sannareddy is 45800 Mountain Pine Square, Sterling,
                Virginia 20166.




(9)
            The
                address of Mr. Srivastava is C-482, Defence Colony, New Delhi 110024
                India.




(10)
            Does
                not include 14,900 shares of common stock issuable upon exercise
                of Class
                W warrants and Class Z warrants which are not exercisable and will
                not be
                exercisable within the next 60 days.




(11)
              The
                  business address of Sapling LLC is 505 Fifth Avenue, 23rdFloor, New York, NY 10017.


(12)
            Sapling
                and Fir Tree Recovery are the beneficial owners 441,841 shares of
                Class B
                common stock and 144,159 shares of Class B common stock, respectively.
                Fir
                Tree, Inc. may be deemed to beneficially own the shares of Class
                B common
                stock held by Sapling LLC and Fir Tree Recovery Master Fund, L.P.,
                as Fir
                Tree, Inc. is the investment manager of both entities. The foregoing
                information is derived from a Schedule 13G filed with the Securities
                and
                Exchange Commission on September 22,
                2006.




(13)
            The
                business address of Fir Tree Recovery Master Fund, L.P. is c/o Admiral
                Administration Ltd., Admiral Financial Center, 5thFloor, 90 Fort Street, Box 32021 SMB, Grand Cayman, Grand Cayman
                Islands.




(14)
            The
                    business address of Fir Tree, Inc. is 505 Fifth Avenue, 23rdFloor, New York, NY
                    10017.






41


(15)
            Does
                not include 2,911,060 shares of common stock issuable upon exercise
                of
                Class W warrants and Class Z warrants which are not exercisable and
                will
                not be exercisable within the next 60 days.




42




**ITEM
      13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.**




In
      August
      2005, we issued 100 shares of common stock for $500 in cash, or a purchase
      price
      of $5.00 per share. We also issued 1,537,500 Class W warrants and 1,537,500
      Class Z warrants for $153,750 in cash, at a purchase price of $0.05 per warrant.
      These securities were issued to the individuals and entities set forth below, as
      follows:




**Name**
            
            **Number
                of Shares of Common Stock**
            
            **Number
                of Class W Warrants**
            
            **Number
                of Class Z Warrants**
            
            **Relationship
                to Us**Rahul
                Prakash
            
            0
            
            583,710
            
            583,710
            
            Chairman
                of the Board and
              Chief
                Executive OfficerAbhishek
                Jain
            
            100(1)
            
            363,260(1)
            
            363,260(1)
            
            President,
                Secretary and DirectorAvinash
                Vashistha
            
            0
            
            363,260(2)
            
            363,260(2)
            
            Executive
                Vice President, Chief Financial Officer and DirectorDr.
                Brian Boyle
            
            0
            
            145,300
            
            145,300
            
            DirectorAtikem
                Haile-Mariam
            
            0
            
            37,260
            
            37,260
            
            Senior
                Advisor and WarrantholderRavindra
                Sannareddy
            
            0
            
            37,260
            
            37,260
            
            Senior
                Advisor and WarrantholderSaurabh
                Srivastava
            
            0
            
            7,450
            
            7,450
            
            Senior
                Advisor and Warrantholder





(1)
            These
                shares and warrants were acquired by WTP Capital, LLC, of which Mr.
                Jain
                is the Chief Executive Officer and a member.




(2)
            These
                warrants were acquired by Tholons Capital LLC, of which Mr. Vashistha
                is
                President and a member.




Each
      of
      the current holders of our securities has agreed, pursuant to a letter agreement
      between us and HCFP/Brenner Securities, not to sell any of the foregoing
      securities until the completion of a business combination. In addition, WTP
      Capital, LLC, the sole holder of our common stock outstanding prior to our
      initial public offering, of which Mr. Jain is Chief Executive Officer and a
      member, has agreed to waive its right to participate in any liquidation
      distribution with respect to shares of common stock acquired by it prior to
      our
      initial public offering.




Everest
      Telecom LLC, an affiliate of Mr. Prakash, has agreed that until the acquisition
      of a target business, it will make available to us office space and certain
      office and administrative services, as we may require from time to time. We
      have
      agreed to pay Everest Telecom $7,500 per month for these services. Mr. Prakash
      is its President and Chief Executive Officer and member owns approximately
      90%
      of Everest Telecom. Consequently, Mr. Prakash will benefit from this transaction
      to the extent of his interests in Everest Telecom. However, this arrangement
      is
      solely for our benefit and is not intended to provide Mr. Prakash compensation
      in lieu of a salary. We believe, based on rents and fees for similar services
      in
      the northern Virginia area, that the fees charged by Everest Telecom is at
      least
      as favorable as we could have obtained from an unaffiliated person. However,
      as
      our directors may not be deemed “independent,” we did not have the benefit of
      disinterested directors approving this transaction.




Our
      initial securityholders advanced a total of $52,500 to us in August 2005 to
      cover expenses related to our initial public offering. We issued notes to them
      which were repaid from the proceeds of our initial public offering that are
      not
      held in trust.




We
      will
      reimburse our initial securityholders, including our officers and directors,
      for
      any reasonable out-of-pocket business expenses incurred by them in connection
      with certain activities on our behalf such as identifying and investigating
      possible target businesses and business combinations. There is no limit on
      the
      amount of accountable out-of-pocket expenses reimbursable by us, which will
      be
      reviewed only by our board or a court of competent jurisdiction if such
      reimbursement is challenged.




43


Other
      than the $7,500 per-month administrative fee payable to Everest Telecom and
      reimbursable out-of-pocket expenses payable to our officers and directors,
      no
      compensation or fees of any kind, including finders and consulting fees, will
      be
      paid to any of our initial securityholders, officers or directors, or to any
      of
      their affiliates prior to, or for any services they render in order to
      effectuate, the consummation of the business combination. From the consummation
      of our initial public offering through July 31, 2006, we paid an aggregate
      of
      $48,937 to Everest Telecom.




Any
      ongoing or future transactions between us and any of our officers and directors
      or their respective affiliates, including loans by our officers and directors,
      will require prior approval in each instance by a majority of our disinterested
      “independent” directors (to the extent we have any) or the members of our board
      who do not have an interest in the transaction. These directors will, if they
      determine necessary or appropriate, have 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.




44





**ITEM
      14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES:**




The
      following is a summary of the fees billed to the Company by BDO Seidman, LLP
      for
      professional services rendered from inception (August 10, 2005) to July 31,
      2006:





Audit
                Fees(1)
            $
            69,496Audit-Related
                Fees(2)
            
            14,000Tax
                Fees(3)
            
            —$
            83,496





(1)
            Represents
                audit fees related to professional services rendered in connection
                with
                our initial public offering (financial statements included in our
                Registration Statement on Form S-1 and our Current Report on Form
                8-K
                filed with the SEC on April 25, 2006), aggregating $42,528 (including
                expenses of $2,528), the audit of our financial statements for the
                period
                from August 10, 2005 (date of inception) to July 31, 2006, estimated
                to be
                $18,000, and for the quarterly review of our financial statements
                in our
                Form 10-Q for the period ended April 30, 2006 of
                $8,968.





(2)
            Audit-related
                fees of $14,000 include professional services related to consultation
                on
                accounting matters during our registration statement process for
                our
                initial public offering.





(3)
            There
                were no tax fees related to professional services rendered for tax
                compliance, tax advice or tax
                planning.





**Pre-Approval
      Policies And Procedures**




We
      currently do not have an audit committee. However, our board of directors has
      approved of the services described above.


45


**PART
      IV**





**ITEM
      15.  EXHIBITS, FINANCIAL STATEMENTS SCHEDULES AND REPORTS ON FORM 8-K:**




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. 333-128350). All other documents listed are filed with
      this report.




Exhibit
                  No.
              
              Description*1.1
              
              Form
                  of Underwriting Agreement.*1.2
              
              Form
                  of Selected Dealers Agreement.3.1
              
              Amended
                  and Restated Certificate of Incorporation.*3.2
              
              By-laws.*3.2.1
              
              Amended
                  and Restated By-laws.*4.1
              
              Specimen
                  Series A Unit Certificate.*4.2
              
              Specimen
                  Series B Unit Certificate.*4.3
              
              Specimen
                  Common Stock Certificate.*4.4
              
              Specimen
                  Class B Common Stock Certificate.*4.5
              
              Specimen
                  Class W Warrant Certificate.*4.6
              
              Specimen
                  Class Z Warrant Certificate.*4.7
              
              Form
                  of Unit Purchase Option to be granted to Representative.*4.8
              
              Form
                  of Warrant Agreement between American Stock Transfer & Trust Company
                  and the Registrant.*10.1
              
              Letter
                  Agreement among the Registrant, HCFP/Brenner Securities LLC and
                  Rahul
                  Prakash.*10.2
              
              Letter
                  Agreement among the Registrant, HCFP/Brenner Securities LLC and
                  Abhishek
                  Jain.*10.3
              
              Letter
                  Agreement among the Registrant, HCFP/Brenner Securities LLC and
                  Avinash
                  Vashistha.
  46
 *10.4
              
              Letter
                  Agreement among the Registrant, HCFP/Brenner Securities LLC and
                  Dr. Brian
                  Boyle*10.5
              
              Letter
                  Agreement among the Registrant, HCFP/Brenner Securities LLC and
                  Atikem
                  Haile- Mariam.*10.6
              
              Letter
                  Agreement among the Registrant, HCFP/Brenner Securities LLC and
                  Ravindra
                  Sannareddy.*10.7
              
              Letter
                  Agreement among the Registrant, HCFP/Brenner Securities LLC and
                  Saurabh
                  Srivastava.*10.8
              
              Letter
                  Agreement among the Registrant, HCFP/Brenner Securities LLC and
                  WTP
                  Capital, LLC.*10.9
              
              Letter
                  Agreement among the Registrant, HCFP/Brenner Securities LLC and
                  Tholons
                  Capital, LLC.*10.10
              
              Form
                  of Investment Management Trust Agreement between American Stock
                  Transfer
                  & Trust Company and the Registrant.*10.11
              
              Registration
                  Rights Agreement among the Registrant and the Initial Stockholders.*10.12
              
              Form
                  of Administrative Services Agreement between Everest Telecom LLC
                  and
                  Registrant.*10.13
              
              Letter
                  Agreement among the Registrant and its Initial Warrantholders dated
                  as of
                  February 2, 2006.31.1
              
              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 the 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




47




**SIGNATURES**




Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, the registrant has duly caused this report to be signed on its behalf
      by
      the undersigned, thereunto duly authorized on the 30 th day of
      October, 2006.




**GLOBAL
              SERVICES PARTNERSACQUISITION CORP.****By:**
            /s/
              Rahul PrakashRahul
                PrakashChairman
                of the Board andChief
                Executive Officer




Pursuant
        to the requirements of the Securities Exchange Act of 1934, this report has
        been
        signed below on the 30 th day of
        October, 2006 by the following persons on behalf of the registrant and in
        the
        capacity indicated.


Name
              
              Title/s/
                  Rahul Prakash
              
              Chairman
                  of the Board and Chief Executive OfficerRahul
                    Prakash
                
                
                /s/
                  Abhishek Jain
              
              President,
                  Secretary and DirectorAbhishek
                    Jain
                
                
                /s/
                  Avinash Vashistha
              
              Executive
                  Vice President, Chief Financial Officer and DirectorAvinash
                    Vashistha
                
                
                /s/
                  Dr. Brian Boyle
              
              DirectorDr.
                  Brian Boyle




48




**GLOBAL
      SERVICES PARTNERS ACQUISITION CORP.**


**(a
        corporation in the development stage)**


**FINANCIAL
      STATEMENTS**


**FOR
      THE FISCAL YEAR ENDED JULY 31, 2006**


**INDEX**





Report
                of Independent Registered Public Accounting Firm
            
            F-2Financial
                Statements:Balance
                Sheet, as of July 31, 2006
            
            F-3Statement
                of Operations, from inception(August
                10, 2005) to July 31, 2006
            
            F-4Statement
                of Stockholders’ Equity, from inception(August
                10, 2005) to July 31, 2006
            
            F-5Statement
                of Cash Flows, from inception(August
                10, 2005) to July 31, 2006
            
            F-6Notes
                to Financial Statements
            
            F-7
                - F-12








F-1


**Report
      of Independent Registered Public Accounting Firm**





Board
      of
      Directors and Stockholders


Global
      Services Partners Acquisition Corp.


Falls
      Church, Virginia




We
      have
      audited the accompanying balance sheet of Global Services Partners Acquisition
      Corp. (a corporation in the development stage) as of July 31, 2006, and the
      related statements of operations, stockholders’ equity and cash flows for the
      period from inception (August 10, 2005) to July 31, 2006. These financial
      statements are the responsibility of the Company’s management. Our
      responsibility is to express an opinion on these financial statements based
      on
      our audit.




We
      conducted our audit in accordance with the standards of Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audit to obtain reasonable assurance about whether the financial
      statements are free of material misstatement. The Company is not required to
      have, nor were we engaged to perform, an audit of its internal control over
      financial reporting. Our audit included consideration of internal control over
      financial reporting as a basis for designing audit procedures that are
      appropriate in the circumstances, but not for the purpose of expressing an
      opinion on the effectiveness of the Company’s internal control over financial
      reporting. Accordingly, we express no such opinion. An audit also includes
      examining, on a test basis, evidence supporting the amounts and disclosures
      in
      the financial statements, assessing the accounting principles used and
      significant estimates made by management, as well as evaluating the overall
      financial statement presentation. We believe that our audit provides 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 Global Services Partners
      Acquisition Corp. as of July 31, 2006, and its results of operations and its
      cash flows for the period from inception (August 10, 2005) to July 31, 2006,
      in
      conformity with accounting principles generally accepted in the United States
      of
      America.








/s/
      BDO
      Seidman, LLP


BDO
      Seidman, LLP


New
      York,
      New York


October
      18, 2006




F-2





**Global
      Services Partners Acquisition Corp.**


**(a
      corporation in the development stage)**


**Balance
      Sheet**





**July
      31, 2006**


**ASSETS****Current
                    Assets:**Cash
                    and cash equivalents
                
                $
                1,583,911Investment
                    held in trust, includinginterest
                    receivable of $80,929 (Note 1)
                
                
                30,449,626Prepaid
                    expenses
                
                
                4,125**Total
                    assets**
                
                $
                32,037,662**LIABILITIES
                    AND STOCKHOLDER'S EQUITY****Current
                    Liabilities:**Accrued
                    registration costs
                
                $
                89,909Accounts
                    payable and accrued expenses
                
                
                42,225Total
                    current liabilities
                
                
                132,134Common
                    stock, Class B subject to possible conversion(1,195,402
                    shares at conversion value) (Note 1)
                
                
                6,086,880**Commitments**(Note
                    5)**Stockholders'
                    Equity**(Note 2, 7 and 8):Preferred
                    stock, par value $.0001 per share,5,000
                    shares authorized, 0 shares issued
                
                
                -Common
                    stock, par value $.0001 per share,24,000,000
                    shares authorized, 920,100 sharesissued
                    and outstanding
                
                
                92Common
                    stock, Class B, par value $.0001 per share,7,000,000
                    shares authorized, 4,784,598 shares issuedand
                    outstanding (excluding 1,195,402 shares subjectto
                    possible conversion)
                
                
                478Additional
                    paid-in-capital
                
                
                25,664,621Retained
                    earnings accumulated in the development stage
                
                
                153,457Total
                    stockholders' equity
                
                
                25,818,648**Total
                    liabilities and stockholders' equity**
                
                $
                32,037,662


See
      Notes
      to Financial Statements





F-3


**Global
      Services Partners Acquisition Corp.**


**(a
      corporation in the development stage)**


**Statement
      of Operations**




**From
      inception (August 10, 2005) to July 31, 2006**


**Operating
                  expenses:**Professional
                  fees
              
              $
              64,424General
                  and administrative expenses (Notes 4 and 5)
              
              
              41,035**Loss
                  from operations**
              
              
              (105,459
              )**Interest
                  income**
              
              
              258,916**Income
                  before provision for income taxes**
              
              
              153,457**Provision
                  for income taxes**(Note 4)
              
              
              -**Net
                  income for the period**
              
              
              153,457Accretion
                  of Trust Fund relating to Class Bcommon
                  stock subject to possible conversion
              
              
              (50,100
              )**Net
                  income attributable to other Class B stockholders****and
                  common stockholders**
              
              $
              103,357**Weighted
                  average Class B common shares outstanding****subject
                  to possible conversion**
              
              
              329,071**Net
                  income per Class B common share subject to
                  possible****conversion,**basic
                  and diluted
              
              $
              0.15**Weighted
                  average number of shares outstanding,**basic
                  and diluted
              
              
              1,570,467**Net
                  income per share,**basic
                  and diluted
              
              $
              0.07




See
      Notes
      to Financial Statements





F-4


**Global
      Services Partners Acquisition Corp.**


**(a
      corporation in the development stage)**


**Statement
      of Stockholders’ Equity**





**From
      inception (August 10, 2005) to July 31, 2006**


**Common
                  Stock**
              
              **Common
                  Stock, Class B**
              
              **Additional**
                  **Paid
                    -In**
              
              **Retained**
                      **earnings**
                      **accumulated
                        in**
                      **the
                        development****Shares**
              
              **Amount**
              
              **Shares**
              
              **Amount**
              
              **Capital**
              
              **stage**
              
              **Total**Balance,
                  August 10, 2005 (inception)
              
              
              -
              
              $
              -
              
              
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -Issuance
                  of Common Stock to initial stockholder100
              
              
              -
              
              
              -
              
              
              -
              
              
              500
              
              
              -
              
              
              500Issuance
                  of 3,075,000 Warrantsat
                  $0.05 Per Warrant
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              153,750
              
              
              -
              
              
              153,750Sale
                  of 460,000 Series A Units and2,990,000
                    Series B Units through public offering net of underwriter’s discount and
                    offering expenses and net of proceeds of $6,036,780 allocable
                    to 1,195,402
                    shares of common stock, Class B subject to possible
                    conversion
              
              
              920,000
              
              
              92
              
              
              4,784,598
              
              
              478
              
              
              25,560,371
              
              
              -
              
              
              25,560,941Proceeds
                  from sale of underwriters’ purchase option
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              100
              
              
              -
              
              
              100Accretion
                  relating to Class B commonstock
                  subject to possible conversion
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (50,100
              )
              
              -
              
              
              (50,100
              )Net
                  income for the period
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              153,457
              
              
              153,457Balance,
                  July 31, 2006
              
              
              920,100
              
              $
              92
              
              
              4,784,598
              
              $
              478
              
              $
              25,664,621
              
              $
              153,457
              
              $
              25,818,648





See
      Notes
      to Financial Statements





F-5


**Global
      Services Partners Acquisition Corp.**


**(a
      corporation in the development stage)**


**Statement
      of Cash Flows**





**From
      inception (August 10, 2005) to July 31, 2006**


**CASH
                  FLOW FROM OPERATING ACTIVITIES**Net
                  income for the period
              
              $
              153,457Adjustments
                  to reconcile net income to net cash used in operating
                  activities:Gain
                  on maturity of securities held in trust fund
              
              
              (169,697
              )Change
                  in operating asset and liability:Interest
                  receivable on investment held in Trust Fund
              
              
              (80,929
              )Increase
                  in prepaid expenses
              
              
              (4,125
              )Increase
                  in accounts payable and accrued expenses
              
              
              42,225**Net
                  cash used in operating activities**
              
              
              (59,069
              )**CASH
                  FLOW FROM INVESTING ACTIVITIES**Purchase
                  of securities held in trust fund
              
              
              (121,072,880
              )Maturity
                  of securities held in trust fund
              
              
              90,873,880**Net
                  cash used in investing activities**
              
              
              (30,199,000
              )**CASH
                  FLOW FROM FINANCING ACTIVITIES**Proceeds
                  from issuance of common stock to initial stockholder
              
              
              500Proceeds
                  from issuance of warrants
              
              
              153,750Proceeds
                  from notes payable to initial securityholders
              
              
              52,500Repayment
                  of notes payable to initial securityholders
              
              
              (52,500
              )Proceeds
                  from sale of underwriters’ purchase option
              
              
              100Portion
                  of net proceeds from sale of Series B units throughpublic
                  offering allocable to shares of common stock, Class Bsubject
                  to possible conversion
              
              
              6,036,780Net
                  proceeds from sale of units through public offering
                  allocableto
                  stockholders’ equity
              
              
              25,650,850**Net
                  cash provided by financing activities**
              
              
              31,841,980**Net
                  increase in cash and cash equivalents**
              
              
              1,583,911**Cash
                  and cash equivalents**Beginning
                  of period
              
              
              -End
                  of period
              
              $
              1,583,911**Supplemental
                  disclosure of non-cash financing activities:**Accrued
                  registration costs
              
              $
              89,909Fair
                  value of underwriter purchase option included inoffering
                  costs
              
              $
              360,000**Supplemental
                  disclosure of cash flow information:**Cash
                  paid for income taxes
              
              $
              -Cash
                  paid for interest
              
              $
              -




See
      Notes
      to Financial Statements





F-6




**Global
        Services Partners Acquisition Corp.**
 **(a
        corporation in the development stage)**
 **Notes
        to Financial Statements**
  **NOTE
        1** - **ORGANIZATION
        AND ACTIVITIES**




Global
      Services Partners Acquisition Corp. (the “Company”) was incorporated in Delaware
      on August 10, 2005 to serve as a vehicle to effect a merger, capital stock
      exchange, asset acquisition or other similar business combination with a
      currently unidentified operating business (a “Target Business”). All activity
      since inception **** (August
      10, 2005) through July 31, 2006 is related to the Company’s formation and
      capital raising activities. The Company has selected July 31 as its fiscal
      year end.




The
      Company is considered to be a development stage company and as such the
      financial statements presented herein are presented in accordance with Statement
      of Financial Accounting Standards ("SFAS") No. 7.




The
      registration statement for the Company's initial public offering ("Offering")
      was declared effective on April 18, 2006. The Company consummated the Offering
      on April 25, 2006 for net proceeds of approximately $31.6 million. The Company's
      management has broad authority with respect to the application of the proceeds
      of the Offering although substantially all of the proceeds of the Offering
      are
      intended to be applied generally toward consummating a merger, capital stock
      exchange, asset acquisition or other similar transaction with a Target Business
      (a "Business Combination"). An amount of $30,449,626 (which includes accrued
      interest of $80,929 as of July 31, 2006) is being held in an interest-bearing
      trust account (“Trust Fund”) to be returned to the holders of Class B common
      stock if a Business Combination is not contracted in 18 months (October 24,
      2007), or consummated in 24 months, subsequent to the Offering (the "Target
      Business Acquisition Period"). In the event there is no Business Combination,
      the Company will dissolve and any remaining net assets, after the distribution
      of the Trust Fund to Class B stockholders, will be distributed to the holders
      of
      common stock sold in the Offering.




Both
      the
      Company's common stock and Class B common stock have one vote per share.
      However, the Class B common stockholders may, and the common stockholders may
      not, vote in connection with a Business Combination. Further, should a Business
      Combination not be consummated during the Target Business Acquisition Period,
      the Trust Fund would be distributed pro-rata to all of the Class B common
      stockholders and their Class B common shares would be cancelled and returned
      to
      the status of authorized but unissued shares. Common stockholders will receive
      none of the proceeds from the Trust Fund should a Business Combination not
      be
      consummated.




The
      Company, after signing a definitive agreement for a Business Combination, is
      obliged to submit such transaction for approval by a majority of the Class
      B
      common stockholders of the Company. Class B common stockholders that vote
      against such proposed Business Combination are, under certain conditions,
      entitled to convert their shares into a pro-rata distribution from the Trust
      Fund (the "Conversion Right"). The actual per-share conversion price will be
      equal to the amount in the Trust Fund (inclusive of any interest thereon) as
      of
      two business days prior to the proposed Business Combination, divided by the
      number of Class B shares sold in the Offering, or approximately $5.09 per share
      based on the value of the Trust Fund as of July 31, 2006. As a result of the
      Conversion Right, $6,086,880 (including accretion of $50,100 through July 31,
      2006) has been classified in Common Stock, Class B subject to possible
      conversion on the accompanying balance sheet as of July 31, 2006. In the event
      that holders of a majority of the outstanding shares of Class B common stock
      vote for the approval of the Business Combination and that holders owning 20%
      or
      more of the outstanding Class B common stock do not exercise their Conversion
      Rights, the Business Combination may then be consummated. Upon completion of
      such Business Combination and the payment of any Conversion Rights (and related
      cancellation of Class B common stock), the remaining shares of Class B common
      stock would be converted to common stock.




**NOTE
      2 - OFFERING**




In
      the
      Offering, effective April 18, 2006 (closed on April 25, 2006), the Company
      sold
      to the public an aggregate of 460,000 Series A Units (the “Series A Units” or a
“Series A Unit”) and 2,990,000 Series B Units (the “Series B Units” or a “Series
      B Unit”) at a price of $8.50 and $10.10 per unit, respectively inclusive of an
      over-allotment option issued to the underwriters to purchase additional Series
      A
      Units and Series B Units, which was exercised in full. Proceeds from the
      Offering, totaled approximately $31.6 million, which was net of approximately
      $2.5 million in underwriting and other expenses incurred through April 25,
      2006.
      Each Series A Unit consists of two shares of the Company's common stock, and
      ten
      Class Z Warrants (each a "Class Z Warrant"). Each Series B Unit consists of
      two
      shares of the Company's Class B common stock, and two Class W Warrants (each
      a
“Class W Warrant”).




F-7




**Global
        Services Partners Acquisition Corp.**
 **(a
        corporation in the development stage)**
 **Notes
        to Financial Statements**




Each
      Class W Warrant entitles the holder to purchase from the Company one share
      of
      common stock at an exercise price of $5.00, subject to adjustment in certain
      circumstances, commencing on the later of (a) April 18, 2007 and (b) the
      completion of a Business Combination. The Class W Warrants will expire on April
      17, 2011 or earlier upon redemption. Each Class Z Warrant entitles the holder
      to
      purchase from the Company one share of common stock at an exercise price of
      $5.00, subject to adjustment in certain circumstances, commencing on the later
      of (a) April 18, 2007 and (b) the completion of a Business Combination. The
      Class Z Warrants will expire on April 17, 2013 or earlier upon redemption.
      The
      Company may redeem the outstanding Class W Warrants and/or Class Z Warrants
      with
      the prior consent of HCFP/Brenner Securities LLC ("HCFP"), the representative
      of
      the underwriters of the Offering, in whole or in part, at a price of $.05 per
      warrant at any time after the warrants become exercisable, upon a minimum of
      30
      days' prior written notice of redemption, and if, and only if, the last sale
      price of the Company's common stock equals or exceeds $7.50 per share and $8.75
      per share, for a Class W Warrant and a Class Z Warrant, respectively, for any
      20
      trading days within any 30 trading day period ending three business days before
      the Company sent the notice of redemption.




The
      Company has also sold to certain of the underwriters for an aggregate of $100,
      an option (the “Underwriter’s Purchase Option” or “UPO”) to purchase up to a
      total of 20,000 additional Series A Units and/or 130,000 additional Series
      B
      Units (see Note 8).




**NOTE
      3** - **SUMMARY
      OF SIGNIFICANT ACCOUNTING POLICIES**




**Cash
      and Cash Equivalents** -
      Included in cash and cash equivalents are deposits with financial institutions
      as well as short-term money market instruments with maturities of three months
      or less when purchased.




**Concentration
      of Credit Risk** -
      Financial instruments that potentially subject the Company to a significant
      concentration of credit risk consist primarily of cash and cash equivalents.
      The
      Company maintains deposits in federally insured financial institutions in excess
      of federally insured limits. However, management believes the Company is not
      exposed to significant credit risk due to the financial position of the
      depository institutions in which those deposits are held.




**Investments
      Held in Trust** - The
      Company’s restricted investment held in the Trust Fund at July 31, 2006 is
      comprised of Commonwealth of Virginia securities with maturities of up to 30
      days. Such securities generate current income which is exempt from federal
      income tax and the income tax imposed by the Commonwealth of Virginia and
      therefore no provision for income taxes is required for the period ended
      July 31, 2006.




**Net
      Income Per Share** - Net
      income per share is computed based on the weighted average number of shares
      of
      common stock and Class B common stock outstanding.




Basic
      earnings (loss) per share is computed by dividing income (loss) available to
      common stockholders by the weighted average common shares outstanding for the
      period. Basic net income per share is calculated by dividing net income
      attributable to (1) common and Class B stockholders and (2) Class B common
      stockholders subject to possible conversion by their weighted average number
      of
      common shares outstanding during the period. Calculation of the weighted average
      common shares outstanding during the period is comprised of 100 initial shares
      outstanding throughout the period from August 10, 2005 to July 31, 2006 and
      an
      additional 920,000 common shares, 4,784,598 Class B shares and 1,195,402 Class
      B
      shares subject to possible conversion outstanding after the effective date
      of
      the offering in April 2006. Diluted earnings per share reflects the potential
      dilution that could occur if securities or other contracts to issue common
      stock
      were exercised or converted into common stock or resulted in the issuance of
      common stock that then shared in the earnings of the entity. Since the effect
      of
      outstanding warrants to purchase common stock and the UPO are antidilutive,
      they
      have been excluded from the Company’s computation of net income per share.
      Therefore, basic and diluted income per share were the same for the period
      from
      inception (August 10, 2005) through July 31, 2006.




F-8


**Global
        Services Partners Acquisition Corp.**
 **(a
        corporation in the development stage)**
 **Notes
        to Financial Statements**




**Fair
      Value of Financial Instruments and Derivatives** - The
      fair values of the Company’s assets and liabilities that qualify as financial
      instruments under SFAS No. 107 approximate their carrying amounts presented
      in the balance sheet at July 31, 2006.




The
      Company accounts for derivative instruments in accordance with SFAS No. 133
“ *Accounting
      for Derivative Instruments and Hedging Activities* ,” *as
      amended* ,
      (“SFAS
      133”) which establishes accounting and reporting standards for derivative
      instruments and hedging activities, including certain derivative instruments
      imbedded in other financial instruments or contracts and requires recognition
      of
      all derivatives on the balance sheet at fair value. Accounting for the changes
      in the fair value of the derivative instruments depends on whether the
      derivatives qualify as hedge relationships and the types of the relationships
      designated are based on the exposures hedged. Changes in the fair value of
      derivative instruments which are not designated as hedges are recognized in
      earnings as other income (loss).




**Use
      of Estimates** - The
      preparation of financial statements in accordance with accounting principles
      generally accepted in the United States of America requires management to make
      estimates and assumptions that affect certain reported amounts of assets and
      liabilities and disclosure of contingent assets and liabilities at the date
      of
      the financial statements and the reported amounts of revenue and expenses during
      the reporting period. Actual results could differ from those
      estimates.




**Income
      Taxes** -
      Deferred income tax assets and liabilities are computed for differences between
      the financial statement and tax bases of assets and liabilities that will result
      in future taxable or deductible amounts and are based on enacted tax laws and
      rates applicable to the periods in which the differences are expected to affect
      taxable income. Valuation allowances are established when necessary to reduce
      deferred income tax assets to the amount expected to be realized.




**New
      Accounting Pronouncements -** The
      Company does not believe that any recently issued, but not yet effective,
      accounting standards if currently adopted would have a material effect on the
      accompanying financial statements.




**NOTE
      4 - INCOME TAXES** ****




*Income
      Taxes*




No
      provision for federal income taxes has been made since the Company’s interest
      income is earned from investments in Commonwealth
      of Virginia and Commonwealth of Maryland securities which are exempt from
      federal taxation.




Significant
      components of the Company’s future tax assets are as follows:


Tax
                  effect of the operating loss carryforward
              
              $
              36,000Less
                  valuation allowance
              
              
              (36,000
              )Totals
              
              $
              -




*Other*




The
      Company is incorporated in Delaware and accordingly is subject to franchise
      taxes. Included as part of general and administrative expenses in the
      accompanying statement of operations for the period ended July 31, 2006 is
      Delaware franchise tax expense of $10,056.




F-9


**Global
          Services Partners Acquisition Corp.**
 **(a
          corporation in the development stage)**
 **Notes
          to Financial Statements**
 **NOTE
        5** - **COMMITMENTS**




*Administrative
      Services*




Commencing
      on April 18, 2006, the effective date of the offering, the Company is obligated
      to pay an affiliate of the Company’s chief executive officer, $7,500 per month
      for office, secretarial and administrative services. An amount of $25,725 for
      such services from April 18, 2006 to July 31, 2006 is included in general and
      administrative expenses on the accompanying statement of
      operations.




*Financial
      Advisory Services*




HCFP
      has
      been engaged by the Company to act as the Company’s non-exclusive investment
      banker in connection with a proposed Business Combination. For assisting the
      Company in structuring and negotiating the terms of a Business Combination,
      the
      Company will pay HCFP a cash transaction fee of $900,000.




*Solicitation
      Services*




The
      Company has engaged HCFP, on a non-exclusive basis, to act as its agent for
      the
      solicitation of the exercise of the Company’s Class W Warrants and Class Z
      Warrants. In consideration for solicitation services, the Company will pay
      HCFP
      a commission equal to 5% of the exercise price for each Class W Warrant and
      Class Z Warrant exercised after April 18, 2007 if the exercise is solicited
      by
      HCFP.





**NOTE
      6 - NOTES PAYABLE**




In
      August
      2005, the Company’s initial securityholders advanced the Company $52,500 in the
      form of non-interest bearing notes. These notes were repaid in May and June
      2006
      from the proceeds of the Offering.




**NOTE
      7 - CAPITAL STOCK**




*Preferred
      Stock*




The
      Company is authorized to issue up to 5,000 shares of Preferred Stock with such
      designations, voting, and other rights and preferences as may be determined
      from
      time to time by the Board of Directors.




*Common
      Stock and Class B Common Stock*




The
      Company is authorized to issue 24,000,000 shares of common stock and 7,000,000
      shares of Class B common stock. As of July 31, 2006, there are 920,100 shares
      of
      the Company’s common stock issued and outstanding and 5,980,000 shares of the
      Company’s Class B stock issued and outstanding, including 1,195,402 Class B
      common shares subject to possible conversion.





As
      of
      July 31, 2006, there are 2,684,900 and 1,020,000 authorized but unissued shares
      of the Company’s common stock and the Company’s Class B common stock,
      respectively, available for future issuance, after appropriate reserves for
      the
      issuance of common stock in connection with the Class W Warrants and Class
      Z
      Warrants, the Underwriters Purchase Option and the officer’s and director’s
      Class W Warrants and Class Z Warrants.





The
      Company currently has no commitments to issue any shares of common stock other
      than as described herein; however, the Company will, in all likelihood, issue
      a
      substantial number of additional shares in connection with a Business
      Combination. To the extent that additional shares of common stock are issued,
      dilution to the interests of the Company’s stockholders who participated in the
      Offering will occur.




F-10


**Global
          Services Partners Acquisition Corp.**
 **(a
          corporation in the development stage)**
 **Notes
          to Financial Statements**


**NOTE
      8 - WARRANTS AND OPTION TO PURCHASE COMMON STOCK**




*Warrants*




In
      August, 2005, the Company sold and issued Class W Warrants to purchase 1,537,500
      shares of the Company’s common stock, and Class Z Warrants to purchase 1,537,500
      shares of the Company’s common stock to its initial securityholders, for an
      aggregate purchase price of $153,750, or $0.05 per warrant.




The
      Class
      W and Class Z Warrants held by the initial securityholders are also subject
      to a
      registration rights agreement. On January 31, 2006, the Company and the
      initial securityholders entered into a registration rights agreement and a
      letter agreement which revised the terms of the Company’s obligations under the
      warrant and registration right agreement to clarify that the Company will only
      deliver unregistered common shares upon exercise of the warrants.




The
      Class
      W Warrants and Class Z Warrants outstanding prior to the Offering may be
      exercised with cash on or prior to their respective expiration dates. Although
      the Company’s initial securityholders may make a written demand that the Company
      file a registration statement, the Company is only required to use its best
      efforts to cause the registration statement to be declared effective and, once
      effective, only to use its best efforts to maintain its effectiveness.
      Accordingly, the Company’s obligation is merely to use its best efforts in
      connection with the registration rights agreement and upon exercise of the
      warrants, the Company can satisfy its obligation by delivering unregistered
      shares of common stock.




Prior
      to
      entering into the registration rights agreement and the letter agreement with
      the initial securityholders, the Company accounted for the Class W and Class
      Z
      Warrants issued to such securityholders as liabilities in accordance with the
      guidance of EITF 00-19, *Accounting
      for Derivative Financial Instruments Indexed to, and Potentially Settled in,
      a
      Company’s Own Stock* .
      Accordingly, the Company recorded the fair value of the warrants of $153,750
      as
      a non-current liability on its balance sheet from the date of issuance through
      January 31, 2006. As a result of entering into the registration rights
      agreement, the warrants no longer are accounted for as liabilities and were
      classified in stockholders’ equity. No income (loss) was recorded related to
      recording the derivative to market value as there was no change in the fair
      value of such securities. The Company determined the fair value of the Class
      W
      and Class Z Warrants issued in August 2005 based on the aggregate purchase
      price
      paid to the Company of $153,750, or $0.05 per Warrant.




On
      January 31, 2006, the date of reclassification of the Warrants from
      liability to equity, the Company estimated that the fair value of the Class
      W
      and Class Z Warrants was still $0.05 per Warrant. The determination to value
      the
      Warrants at $0.05 was based on the cash purchase price paid in August 2005
      by
      the holders, the fact that the Warrants were not publicly traded, the inherent
      price of $0.05 per Warrant contained in the Series A and Series B Units which
      were sold in the Offering, and an evaluation of the differences in the rights
      and privileges of the Warrants sold and issued in August 2005 versus the
      Warrants which were sold in the Offering.




Each
      Class W Warrant issued in the Offering and to the initial securityholders is
      exercisable for one share of common stock. Except as set forth below, the Class
      W Warrants entitle the holder to purchase shares at $5.00, subject to adjustment
      in the event of stock dividends and splits, reclassifications, combinations
      and
      similar events, for a period commencing on the later of: (a) completion of
      the Business Combination and (b) April 18, 2007 and ending
      April 17, 2011. As of July 31, 2006, there were 7,517,500 Class W Warrants
      outstanding.




Each
      Class Z Warrant issued in the Offering and to the initial securityholders is
      exercisable for one share of common stock. Except as set forth below, the Class
      Z Warrants entitle the holder to purchase shares at $5.00, subject to adjustment
      in the event of stock dividends and splits, reclassifications, combinations
      and
      similar events, for a period commencing on the later of: (a) completion of
      the Business Combination and (b) April 18, 2007 and ending
      April 17, 2013. As of July 31, 2006, there were 6,137,500 Class Z Warrants
      outstanding.




The
      Class
      W Warrants and Class Z Warrants outstanding prior to the Offering, all of which
      are held by the Company’s initial securityholders or their affiliates, shall not
      be redeemable by the Company as long as such warrants continue to be held by
      such securityholders or their affiliates. Except as set forth in the preceding
      sentence, the Company may redeem the Class W Warrants and/or Class Z Warrants
      with the prior consent of HCFP, the representative of the underwriters in the
      Offering, in whole or in part, at a price of $.05 per warrant at any time after
      the warrants become exercisable, upon a minimum of 30 days’ prior written notice
      of redemption, and if, and only if, the last sale price of the Company’s common
      stock equals or exceeds $7.50 per share and $8.75 per share, for a Class W
      Warrant and Class Z Warrant, respectively, for any 20 trading days within a
      30
      trading day period ending three business days before the Company sent the notice
      of redemption (the “Measurement Period”). In addition, the Company may not
      redeem the Class W Warrants and/or the Class Z Warrants unless the shares of
      common stock underlying such warrants are covered by an effective registration
      statement from the beginning of the measurement period through the date fixed
      for redemption.




F-11


**Global
          Services Partners Acquisition Corp.**
 **(a
          corporation in the development stage)**
 **Notes
          to Financial Statements**


The
      Class
      W and Class  Z Warrants issued in the Offering will not be exercisable
      unless a registration statement covering the securities underlying the warrants
      is effective or an exemption from registration is available. Accordingly if
      the
      warrants are not able to be exercised such warrants may expire worthless. The
      Company has no obligation to net cash settle the exercise of the
      warrants.




The
      Class
      W Warrants and Class Z Warrants issued may be exercised with cash on or prior
      to
      their respective expiration dates. However, the Class W Warrants and Class
      Z
      Warrants issued will not be exercisable unless at the time of exercise the
      Company has a current prospectus relating to the Company’s common stock issuable
      upon exercise of the warrants and the common stock has been registered,
      qualified or deemed to be exempt under the applicable securities laws.
      Accordingly if the warrants are not able to be exercised such warrants may
      expire worthless. The Company has no obligation to net cash settle the exercise
      of the warrants.




The
      holders of Class W Warrants and Class Z Warrants do not have the rights or
      privileges of holders of the Company’s common stock or any voting rights until
      such holders exercise their respective warrants and receive shares of the
      Company’s common stock. As the proceeds from the exercise of the Class W
      Warrants and Class Z Warrants will not be received until after the completion
      of
      a Business Combination, the expected proceeds from exercise will not have any
      effect on the Company’s financial condition or results of operations prior to a
      Business Combination.




*Underwriter
      Purchase Option*




In
      connection with the Offering, the Company was issued to certain of the
      underwriters an option (the “UPO”) for an aggregate of $100 to purchase up to
      20,000 Series A Units at an exercise price of $14.025 per unit and/or up to
      130,000 Series B Units at an exercise price of $16.665 per unit on the later
      of
      (a) completion of a Business Combination and (b) April 18, 2007
      and ending April 17, 2011. The fair value of the UPO, inclusive of the
      receipt of the $100 cash payment, was accounted for as an expense of the
      Offering resulting in a charge directly to stockholders’ equity with a
      corresponding credit to additional paid-in-capital. The Company determined
      the
      fair value of the UPO of approximately $360,000 using a Black-Scholes
      option-pricing model. The fair value of the UPO granted was estimated as of
      the
      date of issuance using the following assumptions: (1) expected volatility
      of 37.566%, (2) risk-free interest rate of 4.92% and (3) contractual
      life of 5 years. The UPO may be exercised for cash or on a “cashless” basis, at
      the holder’s option, such that the holder may use the appreciated value of the
      UPO (the difference between the exercise prices of the UPO and the underlying
      warrants and the market price of the units and underlying securities) to
      exercise the UPO without the payment of any cash. Each of the Series A Units
      and
      Series B Units included in the UPO are identical to the Series A Units and
      Series B Units sold in the Offering, except that the exercise price of the
      Class W Warrants underlying the Series B Units and the Class Z Warrants
      underlying the Series A Units will be $5.50 per share and the Class Z Warrants
      underlying the Series A Units shall only be exercisable until the fifth
      anniversary of the Offering.




The
      Company has no obligation to net cash settle the exercise of the UPO or the
      warrants underlying the UPO. The holder of the UPO will not be entitled to
      exercise the UPO or the warrants underlying the UPO unless a registration
      statement covering the securities underlying the UPO is effective or an
      exemption from registration is available. If the holder is unable to exercise
      the UPO or underlying warrants, the UPO or warrants, as applicable, will expire
      worthless.




F-12