##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2007
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
 Commission file number: 001-32574
 JK ACQUISITION CORP.
  Delaware
    
    87-0745202(State or other jurisdiction of
    
    (I.R.S. Employer Identification No.)incorporation or organization)4400 Post Oak Parkway, Suite 2530Houston, Texas
    
    77027(Address of principal executive
    
    (Zip Code)offices)
 (713) 978-7557
 þ o
  o o þ
 þ o




---



##### 



JK ACQUISITION CORP.
Table of Contents
 PagePART I  FINANCIAL INFORMATIONItem 1. Financial Statements
    
    
    1Balance Sheets (Unaudited)
    
    
    1Statements of Operations (Unaudited)
    
    
    2Statements of Cash Flows (Unaudited)
    
    
    3Notes to Unaudited Financial Statements
    
    
    4Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    8Item 3. Quantitative and Qualitative Disclosures about Market Risk
    
    
    13Item 4. Controls and Procedures
    
    
    13PART II  OTHER INFORMATIONItem 1. Legal Proceedings
    
    
    14Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    14Item 6. Exhibits
    
    
    15SIGNATURES
    
    
    16INDEX TO EXHIBITS
    
    
    17Certification Pursuant to Section 302Certification Pursuant to Section 302Certification Pursuant to Section 906Certification Pursuant to Section 302Certification Pursuant to Section 302Certification Pursuant to Section 906




---



##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Item 1. Financial Statements
 JK ACQUISITION CORP.
(A Development Stage Company)
 
 BALANCE SHEETS
 As of March 31, 2007 and December 31, 2006
 March 31,
    
    
    December 31,2007
    
    
    2006(Unaudited)ASSETSCurrent assets:Cash
    
    $
    127,515
    
    
    $
    220,104Deferred tax asset
    
    
    1,613
    
    
    
    1,613Total current assets
    
    
    129,128
    
    
    
    221,717Trust fund
    
    
    78,295,787
    
    
    
    77,627,249Deferred
acquisition costs
    
    
    879,096
    
    
    
    788,234Total Assets
    
    $
    79,304,011
    
    
    $
    78,637,200LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable and accrued expenses
    
    $
    363,087
    
    
    $
    299,870Federal income tax payable
    
    
    15,640
    
    
    
    15,640Derivative liabilities
    
    
    
    
    
    
    15,636,834Total Liabilities
    
    
    378,727
    
    
    
    15,952,344Common stock subject to redemption, 2,710,311 shares
    
    
    15,651,328
    
    
    
    15,517,687Stockholders equity:Preferred stock, $0.0001 par value, 1,000,000 shares authorized, none issued and outstanding
    
    
    
    
    
    
    Common stock, $0.0001 par value, 50,000,000 shares authorized, 16,516,667 shares issued and
outstanding at March 31, 2007 and December 31, 2006 (including 2,710,311 shares subject to
redemption)
    
    
    1,652
    
    
    
    1,652Paid-in capital
    
    
    60,781,668
    
    
    
    46,747,075Earnings accumulated during the development stage
    
    
    2,490,636
    
    
    
    418,442Total Stockholders Equity
    
    
    63,273,956
    
    
    
    47,167,169Total Liabilities and Stockholders Equity
    
    $
    79,304,011
    
    
    $
    78,637,200
  1




---



##### Table of Contents



JK ACQUISITION CORP.
(A Development Stage Company)
 
 STATEMENTS OF OPERATIONS
 Three Months ended March 31, 2007 and 2006, (Unaudited)
Period from May 11, 2005 (Inception) to March 31, 2007 (Unaudited)
 Three Months
    
    
    Three Months
    
    
    Period fromEnded
    
    
    Ended
    
    
    Inception toMarch 31,
    
    
    March 31,
    
    
    March 31,2007
    
    
    2006
    
    
    2007Operating expenses:General & administrative
    
    $
    64,944
    
    
    $
    4,954
    
    
    $
    362,316Operating loss
    
    
    (64,944
    )
    
    
    (4,954
    )
    
    
    (362,316
    )Other income:Interest income
    
    
    668,538
    
    
    
    
    
    
    
    2,663,383Gain on derivative liabilities
    
    
    1,468,600
    
    
    
    
    
    
    
    203,596Total other income
    
    
    2,137,138
    
    
    
    
    
    
    
    2,866,979Net income (loss) before income tax expense
    
    
    2,072,194
    
    
    
    (4,954
    )
    
    
    2,504,663Income tax expense
    
    
    
    
    
    
    
    
    
    
    14,027Net income (loss)
    
    $
    2,072,194
    
    
    $
    (4,954
    )
    
    $
    2,490,636Earnings (loss) per share:Basic
    
    $
    0.13
    
    
    $
    0.00Diluted
    
    $
    0.11
    
    
    $
    0.00Weighted average number of common shares
outstanding:Basic
    
    
    16,516,667
    
    
    
    2,958,333Diluted
    
    
    19,711,246
    
    
    
    2,958,333
  2




---



##### Table of Contents



JK ACQUISITION CORP.
(A Development Stage Company)
 
 STATEMENTS OF CASH FLOWS
 Three Months ended March 31, 2007 and 2006, (Unaudited)
Period from May 11, 2005 (Inception) to March 31, 2007 (Unaudited)
 Three Months
    
    
    Three Months
    
    
    Period fromEnded
    
    
    Ended
    
    
    Inception toMarch 31,
    
    
    March 31,
    
    
    March 31,2007
    
    
    2006
    
    
    2007CASH FLOWS FROM OPERATING ACTIVITIESNet income (loss)
    
    $
    2,072,194
    
    
    $
    (4,954
    )
    
    $
    2,490,636Adjustments to reconcile net income (loss) to net cash used in
operating activities:Investment income
    
    
    (668,538
    )
    
    
    
    
    
    
    (2,663,383
    )Gain on derivative liabilities
    
    
    (1,468,600
    )
    
    
    
    
    
    
    (203,596
    )Change in:Deferred tax asset
    
    
    
    
    
    
    
    
    
    
    (1,613
    )Accrued liabilities and accounts payable
    
    
    63,217
    
    
    
    166
    
    
    
    363,087Federal income tax payable
    
    
    
    
    
    
    
    
    
    
    15,640Net cash provided by (used) in operating activities
    
    
    (1,727
    )
    
    
    (4,788
    )
    
    
    771CASH FLOWS FROM INVESTING ACTIVITIESDeferred transaction costs
    
    
    (90,862
    )
    
    
    (18,093
    )
    
    
    (879,096
    )Payment to trust account
    
    
    
    
    
    
    
    
    
    
    (76,532,404
    )Disbursements from trust account
    
    
    
    
    
    
    
    
    
    
    900,000Net cash provided by (used) in investing activities
    
    
    (90,862
    )
    
    
    (18,093
    )
    
    
    (76,511,500
    )CASH FLOWS FROM FINANCING ACTIVITIESGross proceeds from public offering
    
    
    
    
    
    
    
    
    
    
    79,350,000Gross proceeds from private placement
    
    
    
    
    
    
    
    
    
    
    2,000,004Proceeds from sale of stock
    
    
    
    
    
    
    
    
    
    
    31,250Proceeds from sale of underwriter option
    
    
    
    
    
    
    
    
    
    
    100Proceeds from advances from stockholders
    
    
    
    
    
    
    
    
    
    
    329,000Payments on advances from stockholders
    
    
    
    
    
    
    
    
    
    
    (329,000
    )Cash paid for offering costs
    
    
    
    
    
    
    
    
    
    
    (4,743,110
    )Net cash provided by financing activities
    
    
    
    
    
    
    
    
    
    
    76,638,244Net change in cash
    
    
    (92,589
    )
    
    
    (22,881
    )
    
    
    127,515Cash at beginning of period
    
    
    220,104
    
    
    
    26,137
    
    
    
    Cash at end of period
    
    $
    127,515
    
    
    $
    3,256
    
    
    $
    127,515Supplemental disclosures:Cash paid for interest
    
    $
    
    
    
    $
    
    
    
    $
    Cash paid for income taxes
    
    
    
    
    
    
    
    
    
    
    Non-cash transactions:Common stock subject to redemption
    
    $
    
    
    
    $
    
    
    
    $
    15,299,099Increase in value of common stock subject to redemption
    
    
    133,641
    
    
    
    
    
    
    
    352,229Inception of warrants accounted for as derivative liabilities
    
    
    
    
    
    
    
    
    
    
    15,636,834Adjustment for elimination of derivatives at fair value  warrants
    
    
    14,168,233
    
    
    
    
    
    
    
    
    14,168,233
  3




---



##### Table of Contents



JK ACQUISITION CORP.
(A Development Stage Company)
 
 NOTES TO FINANCIAL STATEMENTS
(Unaudited)
 NOTE 1  BASIS OF PRESENTATION
  NOTE 2  INITIAL PUBLIC OFFERING
    NOTE 3  TRUST FUND
  NOTE 4  ADVANCES FROM SHAREHOLDERS
  NOTE 5  DERIVATIVE LIABILITY
   4




---



##### Table of Contents



NOTE 6  EQUITY
   NOTE 7  STOCK OPTION
      5




---



##### Table of Contents



6




---



##### Table of Contents



NOTE 8  RELATED PARTY TRANSACTION
  NOTE 9 DERERRED ACQUISITION COSTS
  NOTE 10 PROPOSED MERGER
   
    
    13,203,700 shares of JK Acquisition common stock;
    
    26,407,400 warrants (each warrant may be exchanged for one share of JKA common stock solely
pursuant to the grant of an Earnout Award (as defined in the Amended Merger Agreement) pursuant to
the Merger Agreement); and
    
    the assumption of Third-Party Indebtedness, which is expected to be approximately $49,400,000.
  NOTE 11LIQUIDITY
   7




---



##### Table of Contents



Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations.
       Developments in Finding a Suitable Business Target
  8




---



##### Table of Contents



Merger Consideration
  
    
    13,203,700 shares of JKA common stock (Parent Shares);
    
    26,407,400 warrants (each warrant may be exchanged for one share of JKA common stock
solely pursuant to the grant of an Earnout Award (as defined in the Amended Merger
Agreement) pursuant to the Amended Merger Agreement)(Parent Warrants); and
    
    the assumption of Third-Party Indebtedness, which is expected to be approximately
$49,400,000.
     Escrow Amounts
  9




---



##### Table of Contents



Closing of the Merger
  Representations and Warranties
   Interim Operations Relating to JKA and Multi-Shot
  No Solicitation
   Indemnification
   10




---



##### Table of Contents



Conditions to the Completion of the Merger
  
    
    no order or injunction enjoining the Merger;
    
    no statute, rule, order or decree shall have been enacted or promulgated which would
prohibit the Merger or otherwise make
the Merger illegal;
    
    receipt of certain consents;
    
    entering into the registration rights agreement, escrow agreement and certain other agreements;
    
    termination of certain Multi-Shot existing plans and agreements;
    
    the majority of voting JKA stockholders shall have approved the transactions contemplated by the Amended Merger
Agreement and public JKA stockholders owning not more than twenty percent (20%) of
JKAs shares of common stock issued in JKAs initial public offering and outstanding
immediately before the closing shall have exercised their rights to convert their shares into a pro rata share of
the trust fund rather than approve the Merger;
    
    certain of the officers of Multi-Shot shall have entered into employment agreements;
    
    the Members shall have approved the transactions contemplated by the Amended Merger Agreement;
    
    all specified waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act, if any, shall have expired, and
    
    the absence of any action, suit or proceeding challenging or preventing the Merger.
 Termination
  
    
    by Multi-Shot if JKA is unable to obtain stockholder approval by July 31, 2007;
    
    at any time, by mutual written agreement as duly authorized by the Board of
Directors of JKA and the Board of Managers of Multi-Shot;
    
    at any time after July 31, 2007, by either Multi-Shot or JKA if the closing shall
not have occurred for any reason other than a breach by the terminating party;
    
    by JKA or Multi-Shot upon the issuance of any order which is final and
nonappealable that would prevent or prohibit the consummation of the Merger;
    
    by JKA, if there is a material breach of any representation, warranty or
obligation by Multi-Shot under the Amended Merger Agreement that renders the
satisfaction of any condition to JKAs obligations impossible and such breach is not
waived by JKA;
    
    by Multi-Shot, if there is a material breach by JKA of any representation,
warranty or obligation under the Amended Merger Agreement, that renders the satisfaction
of any condition to Multi-Shots obligations impossible and such breach is not waived by
Multi-Shot;
    
    by JKA if Multi-Shots adjusted or updated Gross Enterprise Value (as defined in
the Amended Merger Agreement) as of June 30, 2007 is less than the Gross Enterprise
Value as defined in Section 2.01(b)(i) of the Amended Merger Agreement; or
    
    by Multi-Shot in the event: (i) the Investor Purchase Agreement (as defined in
the Amended Merger Agreement) is not consummated on or before March 31, 2007, or (ii) in
the sole reasonable discretion of Multi-Shot, at any earlier date to the extent
Multi-Shot does not believe that the Investor Purchase Agreement is likely to be
consummated on or before March 31, 2007.
  Effect of Termination
  
    
    JKA and MSI are obligated to return all document and work papers obtained from Multi-Shot or the Members;
    
    all filings with any government agencies shall be withdrawn, to the extent practicable;
    
    certain confidentiality obligations will survive closings; and
    
    no party shall be relieved of any liability for willful breach of the Amended Merger Agreement.
 11




---



##### Table of Contents



RESULTS OF OPERATIONS
 Comparison of Three Months Ended March 31, 2007 and 2006
  CHANGES IN FINANCIAL CONDITION
 Liquidity and Capital Resources
      12




---



##### Table of Contents



Off-Balance Sheet Arrangements
  Contractual Obligations
  
 Item 3. Quantitative and Qualitative Disclosures About Market Risk.
  
 Item 4. Controls and Procedures.
    13




---



##### Table of Contents



PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings.
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
        14




---



##### Table of Contents



Item 6. Exhibits.
 Number
    
    Description31.1
    
    Certification by Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Certification by Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Certification by Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 15




---



##### Table of Contents



SIGNATURES
  JK ACQUISITION CORP.Date: May 15, 2007
    
    By:
    
    /s/ James P. Wilson

James P. WilsonChairman of the Board of Directors, Chief
Executive Officer and Secretary
(Principal Executive Officer)
(Principal Financial and Accounting Officer)
 16




---



##### Table of Contents



INDEX TO EXHIBITS
 Number
    
    Description31.1
    
    Certification by Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200231.2
    
    Certification by Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 200232.1
    
    Certification by Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002