UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C.
20549
  Form 10-Q
  (Mark One)
 
 þ
              QUARTERLY REPORT PURSUANT TO
      SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934
 For
the Quarterly Period Ended October 31, 2009
 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 000-51980
  ISRAEL
GROWTH PARTNERS ACQUISITION CORP.
 (Exact
Name of Registrant as Specified in Its Charter)
  Delaware
                  (State
      or Other Jurisdiction of
                  Incorporation
      or Organization)
                20-3233358
                  (I.R.S.
      Employer
                  Identification
      No.)
 
 1600
Tysons Blvd., Suite 1150
 McLean,
VA 22102
 703-286-1390
 (Address
including zip code, and telephone number,
 including
area code, of principal executive offices)
  Not
applicable
 (Former
name, former address and former fiscal year, if changed since last
report)
  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 þ     No
o
  Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).
  Yes o     No
o
  Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check
one):
  Large
      accelerated filer o
                Accelerated
      filer o
                Non-accelerated
      filer o
                Smaller
      reporting company þ
 (Do not
check if a smaller reporting company)
  Indicate
by check mark whether the registrant is a shell company (as defined
in Rule 12b-2 of the Exchange Act).
  Yes þ     No
o
  As of
November December 11, 2009, 1,065,100 shares of common stock, par value $0.0001
per share, of the registrant were outstanding.
  
  TABLE
OF CONTENTS
  PagePART I -
      FINANCIAL INFORMATION
                          
                          3Item
      1.
                          Financial
      Statements
                          
                          3Condensed
      Balance Sheets as of October 31, 2009 and July 31, 2009
      (unaudited)
                          
                          3Condensed
      Statements of Operations for the three months ended October 31, 2009 and
      2008 and for the period from August 1, 2005 (inception) to October 31,
      2009 (unaudited)
                          
                          4Condensed
      Statement of Stockholders’ Equity for August 1, 2005 (inception) to July
      31, 2009 (audited and the three months ended October 31, 2009
      (unaudited)
                          
                          5Condensed
      Statements of Cash Flows for the three months ended October 31, 2009 and
      2008 and for the period from August 1, 2005 (inception) to October 31,
      2009 (unaudited)
                          
                          6Notes
      to Condensed Financial Statements
                          
                          7Item
      2.
                          Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
                          
                          15Item
      4T.
                          Controls
      and Procedures
                          
                          16PART II -
      OTHER INFORMATION
                          
                          17Item
      1.
                          Legal
      Proceedings
                          
                          17Item
      1A.
                          Risk
      Factors
                          
                          17Item
      6.
                          Exhibits
                          
                          17SIGNATURES
                          
                          18
  2
  PART
I
  Item
1.  Financial
Statements
  Israel
Growth Partners Acquisition Corp.
 Condensed
Balance Sheets
 
 As
      of
                                
                                
                                As
      ofOctober
      31, 2009
                                
                                
                                July
      31, 2009(Unaudited)
                                
                                
                                (Audited)ASSETSCurrent
      Assets:Cash
      and cash equivalents
                                
                                $
                                16,987
                                
                                
                                $
                                22,689Total
      assets
                                
                                $
                                16,987
                                
                                
                                $
                                22,689LIABILITIES
      AND STOCKHOLDERS' EQUITYCurrent
      Liabilities:Accrued
      expenses
                                
                                $
                                63,701
                                
                                
                                $
                                60,117Total
      current liabilities
                                
                                
                                63,701
                                
                                
                                
                                60,117Commitments
      (Note 4)Stockholders'
      (Deficit) (Notes 2, 4 and 5)Preferred
      stock, par value $.0001 per share,
                                  5,000
      shares authorized, 0 shares issued and outstanding
                                
                                
                                -
                                
                                
                                
                                -Common
      stock, par value $.0001 per share,
                                  80,000,000
      shares authorized, 1,065,100 shares issued and
      outstanding
                                
                                
                                107
                                
                                
                                
                                107Common
      stock, Class B, par value $.0001 per share,
                                  12,000,000
      shares authorized, 0 shares issued and outstanding
                                
                                
                                -
                                
                                
                                
                                -Additional
      paid-in-capital
                                
                                
                                1,460,540
                                
                                
                                
                                1,460,540Retained
      earnings (deficit) accumulated in the development stage
                                
                                
                                (1,507,361
                                )
                                
                                
                                (1,498,075
                                )Total
      stockholders' equity (deficit)
                                
                                
                                (46,714
                                )
                                
                                
                                (37,428
                                )Total
      liabilities and stockholders' equity
                                
                                $
                                16,987
                                
                                
                                $
                                22,689
 See Notes
to Unaudited Condensed Financial Statements
  3
  Israel
Growth Partners Acquisition Corp.
 Condensed
Statement of Operations
  For
      the three months ended
                            
                            
                            Period
      from inceptionUnaudited
                            
                            
                            (August
      1, 2005) toOctober
      31, 2009
                            
                            
                            October
      31, 2008
                            
                            
                            October
      31, 2009Revenue
                            
                            $
                            -
                            
                            
                            $
                            -
                            
                            
                            $
                            -Operating
      expenses:Professional
      fees
                            
                            
                            8,380
                            
                            
                            
                            100,870
                            
                            
                            
                            833,446Delaware
      franchise tax
                            
                            
                            -
                            
                            
                            
                            16,132
                            
                            
                            
                            229,520Other
      general and administrative expenses (Note 4)
                            
                            
                            906
                            
                            
                            
                            35,372
                            
                            
                            
                            536,231Loss
      from operations
                            
                            
                            (9,286
                            )
                            
                            
                            (152,374
                            )
                            
                            
                            (1,599,197
                            )Interest
      Income
                            
                            
                            -
                            
                            
                            
                            261,978
                            
                            
                            
                            3,715,745Income
      (loss) before provision for income taxes
                            
                            
                            (9,286
                            )
                            
                            
                            109,604
                            
                            
                            
                            2,116,548Provision
      for income taxes
                            
                            
                            -
                            
                            
                            
                            -
                            
                            
                            
                            -Net
      income (loss) for the period
                            
                            $
                            (9,286
                            )
                            
                            $
                            109,604
                            
                            
                            $
                            2,116,548Accretion
      of Trust Fund relating to Class B common stock subject to
      conversion
                            
                            
                            -
                            
                            
                            
                            (52,089
                            )
                            
                            
                            (734,003
                            )Net
      income (loss) attributable to other Class B stockholders and common
      stockholders
                            
                            $
                            (9,286
                            )
                            
                            $
                            57,515
                            
                            
                            $
                            1,382,545Weighted
      average Class B common shares outstanding subject to conversion (no
      Class B common shares outstanding on October 31,
2009)
                            
                            
                            -
                            
                            
                            
                            2,046,176Net income per Class B common
      share subject toconversion,basic and
      diluted
                            
                            $
                            -
                            
                            
                            $
                            0.03Weighted average number of
      shares outstanding,basic and diluted
                            
                            
                            1,065,100
                            
                            
                            
                            9,254,924Net income (loss)per share,basic and diluted
                            
                            $
                            (0.01
                            )
                            
                            $
                            0.01
 See Notes
to Unaudited Condensed Financial Statements
  4
  Israel
Growth Partners Acquisition Corp.
 Condensed
Statement of Stockholders' Equity for the period
 from
inception (August 1, 2005) to April 30, 2009
  DeficitAdditional
                                                
                                                
                                                accumulated
      inCommon
      Stock
                                                
                                                
                                                Common
      Stock, Class B
                                                
                                                
                                                Paid
      -In
                                                
                                                
                                                the
      developmentShares
                                                
                                                
                                                Amount
                                                
                                                
                                                Shares
                                                
                                                
                                                Amount
                                                
                                                
                                                Capital
                                                
                                                
                                                stage
                                                
                                                
                                                TotalBalance,August 1, 2005 (inception)
                                                
                                                
                                                -
                                                
                                                
                                                $
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                $
                                                -
                                                
                                                
                                                $
                                                -
                                                
                                                
                                                $
                                                -
                                                
                                                
                                                $
                                                -Issuance
      of Common Stock to initial stockholder
                                                
                                                
                                                100
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                500
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                500Issuance
      of 4,950,000 Warrants at $0.05 Per Warrant
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                247,500
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                247,500Sale
      of 532,500 Series A Units, 5,118,000Series
      B Units through public offering net of underwriters' discount and offering
      expenses and net of proceeds of 10,333,190 allocable to 2,046,176 shares
      of common stock,Class
      B subject to possible conversion
                                                
                                                
                                                1,065,000
                                                
                                                
                                                
                                                107
                                                
                                                
                                                
                                                8,189,824
                                                
                                                
                                                
                                                819
                                                
                                                
                                                
                                                42,567,464
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                42,568,390Proceeds
      from sale of underwriters' purchase option
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                100
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                100Accretion
      relating to Class B common stock subject to possible
      conversion
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                (5,853
                                                )
                                                
                                                
                                                
                                                
                                                
                                                
                                                (5,853
                                                )Net
      loss for the period
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                -
                                                
                                                
                                                
                                                (84,852
                                                )
                                                
                                                
                                                (84,852
                                                )Balance,
      July 31, 2006
                                                
                                                
                                                1,065,100
                                                
                                                
                                                
                                                107
                                                
                                                
                                                
                                                8,189,824
                                                
                                                
                                                
                                                819
                                                
                                                
                                                
                                                42,809,711
                                                
                                                
                                                
                                                (84,852
                                                )
                                                
                                                
                                                42,725,785Accretion
      relating to Class B common stock subject to possible
      conversion
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                (369,496
                                                )
                                                
                                                
                                                
                                                
                                                
                                                
                                                (369,496
                                                )Net
      income for the period
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                1,479,275
                                                
                                                
                                                
                                                1,479,275Balance,
      July 31, 2007
                                                
                                                
                                                1,065,100
                                                
                                                
                                                $
                                                107
                                                
                                                
                                                
                                                8,189,824
                                                
                                                
                                                $
                                                819
                                                
                                                
                                                $
                                                42,440,215
                                                
                                                
                                                $
                                                1,394,423
                                                
                                                
                                                $
                                                43,835,564Accretion
      relating to Class B common stock subject to possible
      conversion
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                (294,049
                                                )
                                                
                                                
                                                
                                                
                                                
                                                
                                                (294,049
                                                )Net
      income for the period
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                798,309
                                                
                                                
                                                
                                                798,309Net
      income from inception to July 31, 2008 before reclassification of interest
      earned on trust account
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                2,192,732
                                                
                                                
                                                
                                                -Reclassification
      of interest earned on trust account since inception to additional paid-in
      capital
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                3,319,382
                                                
                                                
                                                
                                                (3,319,382
                                                )
                                                
                                                
                                                -Reclassification
      of Class B common stock value subject to redemption to current
      liability
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                (44,014,447
                                                )
                                                
                                                
                                                -
                                                
                                                
                                                
                                                (44,014,447
                                                )Proceeds
      from sale by beneficial owner of Class B stock
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                7,343
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                7,343Balance,
      July 31, 2008
                                                
                                                
                                                1,065,100
                                                
                                                
                                                $
                                                107
                                                
                                                
                                                
                                                8,189,824
                                                
                                                
                                                $
                                                819
                                                
                                                
                                                $
                                                1,458,444
                                                
                                                
                                                $
                                                (1,126,650
                                                )
                                                
                                                $
                                                332,720Accretion
      relating to Class B common stock subject to possible
      conversion
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                (64,605
                                                )
                                                
                                                
                                                
                                                
                                                
                                                
                                                (64,605
                                                )Reclassification
      of interest earned on trust account to additional paid-in
      capital
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                304,527
                                                
                                                
                                                
                                                (304,527
                                                )
                                                
                                                
                                                -Reclassification
      of Class B common stock value subject to redemption to current
      liability
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                (238,645
                                                )
                                                
                                                
                                                
                                                
                                                
                                                
                                                (238,645
                                                )Cancellation
      of B Common Stock
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                (8,189,824
                                                )
                                                
                                                
                                                (819
                                                )
                                                
                                                
                                                819
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                -Net
      (Loss) for the period
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                (66,898
                                                )
                                                
                                                
                                                (66,898
                                                )Balance,
      July 31, 2009(Audited)
                                                
                                                
                                                1,065,100
                                                
                                                
                                                $
                                                107
                                                
                                                
                                                
                                                -
                                                
                                                
                                                $
                                                -
                                                
                                                
                                                $
                                                1,460,540
                                                
                                                
                                                $
                                                (1,498,075
                                                )
                                                
                                                $
                                                (37,428
                                                )Net
      (Loss) for the period
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                
                                                (9,286
                                                )
                                                
                                                
                                                (9286
                                                )Balance,
      October 31, 2009(Unaudited)
                                                
                                                
                                                1,065,100
                                                
                                                
                                                $
                                                107
                                                
                                                
                                                
                                                -
                                                
                                                
                                                $
                                                0
                                                
                                                
                                                $
                                                1,460,540
                                                
                                                
                                                $
                                                (1,507,361
                                                )
                                                
                                                $
                                                (46,714
                                                )
 See Notes
to Unaudited Condensed Financial Statements
  5
  Israel
Growth Partners Acquisition Corp.
 Condensed
Statement of Cash Flows
  For
      the three mnths ended
                      
                      
                      Period
      from inceptionUnaudited
                      
                      
                      (August
      1, 2005) toOctober 31, 2009
                      
                      
                      October 31, 2008
                      
                      
                      October 31, 2009CASH
      FLOWS FROM OPERATING ACTIVITIESNet
      income (loss) for the period
                      
                      $
                      (9,286
                      )
                      
                      $
                      109,604
                      
                      
                      $
                      2,116,549Adjustments
      to reconcile net income to net cash used in operating
      activities:Gain
      on maturity of Securities held in Trust Fund
                      
                      
                      -
                      
                      
                      
                      (316,919
                      )
                      
                      
                      (3,622,634
                      )Changes
      in operating assets and liabilities:Decrease
      (increase) in interest receivable in trust
                      
                      
                      -
                      
                      
                      
                      56,344
                      
                      
                      
                      -Decrease
      in accounts receivable - interest
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      -Decrease
      (Increase) in prepaid expenses
                      
                      
                      -
                      
                      
                      
                      14,954
                      
                      
                      
                      -(Decrease)
      Increase in accrued expenses
                      
                      
                      3,584
                      
                      
                      
                      (18,239
                      )
                      
                      
                      63,701Net
      cash used in operating activities
                      
                      
                      (5,702
                      )
                      
                      
                      (154,256
                      )
                      
                      
                      (1,442,384
                      )CASH
      FLOWS FROM INVESTING ACTIVITIESPurchase
      of Securities held in trust
                      
                      
                      0
                      
                      
                      
                      (165,354,758
                      )
                      
                      
                      (1,665,222,246
                      )Maturity
      of Securities held in trust
                      
                      
                      -
                      
                      
                      
                      165,354,758
                      
                      
                      
                      1,613,530,446Net
      cash used in investing activities
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      (51,691,800
                      )CASH
      FLOWS FROM FINANCING ACTIVITIESProceeds
      from issuance of common stock to initial stockholder
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      500Proceeds
      from issuance of warrants
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      247,500Proceeds
      from sale of underwriters' purchase option
                      
                      
                      -
                      
                      
                      
                      
                      
                      
                      
                      100Portion
      of net proceeds from sale of Series B units through public offering
      allocable to shares of common stock, Class B subject to
      possible conversion
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      10,327,338Proceeds
      from sale by beneficial owner of Class B stock
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      7,343Net
      proceeds from sale of Series A and B units through public offering
      allocable to stockholders' equity
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      42,568,390Net
      cash (used in) provided by financing activities
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      53,151,171Net
      increase (decrease) in cash and cash equivalents
                      
                      
                      (5,702
                      )
                      
                      
                      (154,256
                      )
                      
                      
                      16,987Cash
      and cash equivalentsBeginning
      of period
                      
                      
                      22,689
                      
                      
                      
                      438,699
                      
                      
                      
                      -End
      of period
                      
                      $
                      16,987
                      
                      
                      $
                      284,443
                      
                      
                      $
                      16,987Supplemental
      disclosure of non-cash financing activities:Fair
      value of underwriter purchase option included in offering
      costs
                      
                      $
                      -
                      
                      
                      $
                      -
                      
                      
                      $
                      641,202Accretion
      of Trust Fund relating to Class B common stock subject to possible
      coversion
                      
                      $
                      -
                      
                      
                      $
                      (52,089
                      )
                      
                      $
                      (735,003
                      )Reclassification
      of Class B common stock to liability
                      
                      $
                      -
                      
                      
                      $
                      208,486
                      
                      
                      $
                      -Reclassification
      of Class B, subject to possible conversion to liability
                      
                      $
                      -
                      
                      
                      $
                      52,089
                      
                      
                      $
                      -
 
 See Notes
to Unaudited Condensed Financial Statements
  6
  NOTES
TO FINANCIAL STATEMENTS
  NOTE
1 – ORGANIZATION AND BUSINESS OPERATIONS
  Israel
Growth Partners Acquisition Corp. (the “Company”) was incorporated in Delaware
on August 1, 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 which has operations or facilities
located in Israel, or which is a company operating outside of Israel which the
Company’s management believes would benefit from establishing operations or
facilities in Israel (a “Target Business”). All activity from inception (August
1, 2005) through July 31, 2009 related to the Company’s formation and capital
raising activities. The Company has selected July 31 as its 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, Accounting and Reporting By
Development Stage Enterprises
  Organization
  The
registration statement for the Company’s initial public Offering (“Offering”)
was declared effective on July 11, 2006. The Company consummated the Offering of
500,000 series A Units (Note 2) and 4,600,000 Series B Units (Note 2) on July
18, 2006. On July 26, 2006, the Company consummated the closing of an additional
32,500 Series A Units and 518,000 Series B Units which were subject to an
over-allotment option granted to the underwriters. The Offering generated total
net proceeds of approximately $52.9 million of which $51.7 million was placed in
trust. 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 $55,011,182 including accrued interest of $77,146 was 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 was  not contracted in
18 months, or consummated in 24 months, subsequent to the Offering (the “Target
Business Acquisition Period”).
  Both the
Company’s common stock and Class B common stock had one vote per share. However,
the Class B stockholders could, and the common stockholders could not, vote in
connection with a Business Combination. Since a Business Combination was not
consummated during the Target Business Acquisition Period, as noted above the
Trust Fund will be distributed pro-rata to all of the Class B common
stockholders and their Class B common shares will be cancelled and returned to
the status of authorized but unissued shares. Common stockholders will not
receive any of the proceeds from the Trust Fund.
  Operations
  The
registration statement for the Company’s initial public offering (“Offering”)
was declared effective on July 11, 2006. The Company consummated the Offering of
500,000 series A Units (Note 2) and 4,600,000 Series B Units (Note 2) on July
18, 2006. On July 26, 2006, the Company consummated the closing of an additional
32,500 Series A Units and 518,000 Series B Units which were subject to an
over-allotment option granted to the underwriters. The Offering generated total
net proceeds of approximately $52.9 million of which $51.7 million was placed in
an interest-bearing trust account (“Trust Fund”). The Company’s management was
given broad authority with respect to the application of the proceeds of the
Offering although substantially all of the proceeds of the Offering were
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”).  Under the terms of the Company’s
certificate of incorporation, the funds held in the Trust Fund were required to
be returned to the holders of Class B common stock if a Business Combination was
not contracted in 18 months, or consummated in 24 months, subsequent to the
Offering (the “Target Business Acquisition Period”).  Under the
Offering, the Company indicated its intent to dissolve in the event of a failure
to consummate a Business Combination within the Target Business Acquisition
Period.
  Both the
Company’s common stock and Class B common stock had one vote per share. However,
the Class B stockholders could, and the common stockholders could not, vote in
connection with a Business Combination.
  On March
6, 2008 the Company entered into a merger agreement with Negevtech Ltd., an
Israeli company. On July 18, 2008, the Company announced that it and Negevtech
had terminated their definitive agreement due to an inability to consummate the
transaction by that date, which was the last possible date that the Company
could consummate a transaction under its certificate of incorporation as
amended.  As a result, the Company announced plans to distribute the
amount held in the Trust Fund to its Class B stockholders.
  On
September 12, 2008 the Company and FI Investment Group., LLC (“FIIG”), the
largest holder of shares of the Company’s $.0001 par value common stock, entered
into an agreement under which the Company, at the request of FIIG, agreed to
propose to its stockholders, including the holders of its shares of $.0001 par
value Class B common stock, as an alternative to dissolution, amendments to its
certificate of incorporation allowing the Company to maintain its corporate
existence and provide for the prompt distribution of the funds being held in
trust for the benefit of the holders of Class B common stock in connection with
the cancellation of their Class B shares.
  7
  The
agreement also provided FIIG with the right to appoint a member to the Company’s
board of directors.  Additionally, it provided for the resignation of
each of the Company’s directors and officers that were serving the Company as of
the date of the agreement upon the Company’s stockholders approval of the
amendments to the Company’s certificate of incorporation described in the
agreement and after all of the assets in the trust fund are distributed to the
holders of Class B common stock.
  On
October 14, 2008, the Company announced that it had determined, in light of
current market uncertainties, to authorize the transfer of the funds being held
in the IPO trust account from a money market fund invested primarily in
municipal bonds into the Federated Treasury Obligations Fund - Institutional
Shares ($33.5 billion in assets as of September 30, 2008), a money market fund
invested in U.S. treasury and treasury repurchase agreements. The fund is held
in a brokerage account at Barclays Capital. The IPO trust account assets are
held in a custodial account at State Street Bank & Trust. The transfer of
$55,222,377.61 in IPO trust account assets was effected at par on October 7,
2008.
  On
October 20, 2008, the Company filed a preliminary proxy statement, at the
request of FIIG, to hold a special stockholders meeting to consider proposals
for the distribution of the funds in the IPO trust account to the Class B common
stockholders and the cancellation of the outstanding shares of the Class B
common stock, without the requirement that the Company dissolve and liquidate,
and to allow the Company to continue its corporate existence after the
distribution of the trust fund by removing those provisions in the Company’s
certificate of incorporation that would require the Company to dissolve or
liquidate and that limit its status to a blank check company.
  On
January 27, 2009 the Company’s Board of Directors set a meeting date of February
16, 2009, for the Company’s special meeting of stockholders to be held to
consider proposals to approve certain amendments to the Company’s certificate of
incorporation to allow the Company to distribute the proceeds of the Company’s
IPO trust account to the holders of its Class B common stock, and to allow the
Company to continue its corporate existence after the distribution of the trust
account, without requiring the dissolution and liquidation of the Company or to
approve the dissolution and liquidation of the Company.
  At a
special meeting of stockholders held on February 16, 2009, the Company’s
stockholders approved a proposal to distribute the Company’s trust fund for the
benefit of its Class B common stockholders, without the requirement that the
Company dissolve and liquidate.  As a result of the stockholder vote,
the Company filed an amendment to its certificate of incorporation which
resulted in the cancellation of all shares of the Company’s Class B common
stock, and the conversion of those shares into the right to receive a pro rata
share of the trust fund distribution.  Thereafter, the Company’s Class
B common stock and Series B Units ceased to be quoted on the over-the-counter
bulletin board and ceased to trade or be tradeable, and the trust fund was
distributed to the holders of Class B common stock.  The total amount
of funds in the Trust Fund distributed to the holders of Class B common stock
was $55,315,709.   FIIG, the largest holder of shares of the
Company’s common stock, became the Company’s majority stockholder as a result of
the cancellation of the outstanding Class B common stock.
  At a
continuation of the special stockholder meeting held on February 17, 2009, the
Company’s stockholders (then consisting only of holders of common stock)
approved proposals to amend and restate the Company’s certificate of
incorporation to (1) remove certain blank check company-related restrictions,
including provisions which required the Company to dissolve following the
distribution of the trust account and provisions authorizing the Class B common
stock, and (2) increase the authorized shares of common stock from 40,000,000
shares to 80,000,000 shares.  As a result of this stockholder vote,
the Company filed an amended and restated certificate of incorporation, which
allowed the Company to continue its corporate existence following the
distribution of the trust fund.
  At a
meeting of the Company’s Board of Directors held on March 13, 2009, the Board of
Directors appointed Richard J. Roth, FIIG’s Managing Director and Chief
Financial Officer, and Abhishek Jain, Chief Executive Officer of WTP Capital,
LLC, to the Board of Directors.  Immediately following the appointment
of Mr. Roth and Mr. Jain, each of the remaining members of the Board of
Directors, Matty Karp, Carmel Vernia and Dror Gad, resigned from the Board of
Directors and as officers of the Company, resulting in Mr. Roth and Mr. Jain
continuing as the sole members of the Board of Directors.
  Going
concern consideration
  At
October 31, 2009, the Company had $16,987 in cash, current liabilities of
$63,701 and working capital deficit of $46,714. Further, the Company has
incurred and expects to continue to incur costs in pursuit of its acquisition
plans. These factors, among others, indicate that the Company may be unable to
continue operations as a going concern unless further financing is consummated.
There is no assurance that the Company’s plans to raise capital or to consummate
a transaction will be successful.
  8
  Interim
financial statements
  The
accompanying unaudited condensed financial statements have been prepared
pursuant to the rules and regulations of the Securities and Exchange Commission
(“SEC”) and should be read in conjunction with the Company’s audited financial
statements and footnotes thereto for the year ended July 31, 2009 included in
the Company’s Form 10-K filed on December 2, 2009. Certain information and
footnote disclosures normally included in financial statements prepared in
accordance with accounting principles generally accepted in the United States of
America have been omitted pursuant to such rules and regulations. However, the
Company believes that the disclosures are adequate to make the information
presented not misleading. The financial statements reflect all adjustments
(consisting primarily of normal recurring adjustments) that are, in the
opinion of management necessary for a fair presentation of the Company’s
financial position and results of operations. The operating results for the
three months ended October 31, 2009 are not necessarily indicative of the
results to be expected for any other interim period of any future
year.
  NOTE
2 – OFFERING
  In the
Offering, effective July 11, 2006, the Company sold to the public an aggregate
of 532,500 Series A Units (the “Series A Units” or a “Series A Unit”) and
5,118,000 Series B Units (the “Series B Units” or a “Series B Unit”) at a price
of $8.50 and $10.10 per unit, respectively. Proceeds from the Offering, totaled
approximately $52.9 million, which was net of approximately $3.3 million in
underwriting expenses and other registration costs incurred through July 26,
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”).
  Each
Class W Warrant included in the units sold in the Offering 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) July 11, 2007 and (b) the completion of a Business Combination. The Class
W Warrants will expire on July 10, 2011 or earlier upon redemption. Each Class Z
Warrant included in the units sold in the Offering 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) July 11, 2007 and (b) the completion of a Business Combination. The Class
Z Warrants will expire on July 10, 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 25,000 additional Series A Units and/or 230,000 additional Series B
Units (see Note 6).
  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 maintain 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 –
Investments held in the Trust Fund at July 31, 2008 consisted of municipal money
fund securities with maturities of up to 30 days. Such securities generate
current income which is exempt from federal income tax and therefore no
provision for income taxes is required for the periods ended October 31, 2009 or
2008.   The entire amount in the Trust Fund was transferred on
October 7, 2008 at par into the Federated Treasury Obligations Fund -
Institutional Shares ($33.5 billion in assets as of September 30, 2008), a money
market fund invested in U.S. treasury and treasury repurchase agreements. The
fund was held in a brokerage account at Barclays Capital. See Note 1 –
Organization and Business Operations.  On February 16, 2009 the total
amount of funds in the Trust Fund totaling $55,315,709 were distributed to the
holders of the Class B Common Stock.
  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 in 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. Franchise
taxes incurred in the State of Delaware are included in general and
administrative expenses.
  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.
  9




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. 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, as their exercise prices are greater than the average market
price of common stock during the period, 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 1, 2005)
through October 31, 2009.




FAIR VALUE OF FINANCIAL
INSTRUMENTS – FASB ASC Topic 820, “Fair Value measurement and
Disclosures”, an Accounting Standard Update. In September 2009, the FASB issued
this Update to amendments to Subtopic 82010, “Fair Value Measurements and
Disclosures”. Overall, for the fair value measurement of investments in certain
entities that calculates net asset value per share (or its equivalent). The
amendments in this Update permit, as a practical expedient, a reporting entity
to measure the fair value of an investment that is within the scope of the
amendments in this Update on the basis of the net asset value per share of the
investment (or its equivalent) if the net asset value of the investment (or its
equivalent) is calculated in a manner consistent with the measurement principles
of Topic 946 as of the reporting entity’s measurement date, including
measurement of all or substantially all of the underlying investments of the
investee in accordance with Topic 820. The amendments in this Update also
require disclosures by major category of investment about the attributes of
investments within the scope of the amendments in this Update, such as the
nature of any restrictions on the investor’s ability to redeem its investments
at the measurement date, any unfunded commitments (for example, a contractual
commitment by the investor to invest a specified amount of additional capital at
a future date to fund investments that will be made by the investee), and the
investment strategies of the investees. The major category of investment is
required to be determined on the basis of the nature and risks of the investment
in a manner consistent with the guidance for major security types in GAAP on
investments in debt and equity securities in paragraph 320-10-50-lB. The
disclosures are required for all investments within the scope of the amendments
in this Update regardless of whether the fair value of the investment is
measured using the practical expedient. The amendments in this Update apply to
all reporting entities that hold an investment that is required or permitted to
be measured or disclosed at fair value on a recurring or non recurring basis
and, as of the reporting entity’s measurement date, if the investment meets
certain criteria The amendments in this Update are effective for the interim and
annual periods ending after December 15, 2009. Early application is permitted in
financial statements for earlier interim and annual periods that have not been
issued.




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.




NEW
ACCOUNTING PRONOUNCEMENTS




·
            FASB ASC Topic
      855, “Subsequent
      Events”. In May 2009,
      the FASB issued FASB ASC Topic 855, which establish general standards of
      accounting and disclosure of events that occur after the balance sheet
      date but before financial statements are issued or are available to beissued. In particular, this
      Statement sets forth : (i) the period after the balance sheet date during
      which management of a reporting entity shouldevaluate events or transactions
      that may occur for potential recognition or disclosure in the
      financial statements,
      (ii) the circumstances underwhich an entity should recognize
      events or transactions occurring after the balance sheet date in its
      financial statements, (iii) the disclosuresthat an entity should make about
      events or transactions that occurred after the balance sheet
      date. This FASB ASC Topic should be applied tothe accounting and disclosure of
      subsequent events. This FASB ASC Topic does not apply to subsequent events
      or transactions that are within the scope of other applicable
      accounting standards
      that provide different guidance on the accounting treatment for subsequent
      eventsor
      transactions. This FASB ASC Topic was effective for interim and annual
      periods ending after June 15, 2009, which was June 30, 2009 for theCorporation. The
      adoption of this
      Topic did not have a material impact on the Company’s financial statements anddisclosures.




·
            FASB ASC Topic
      105, “The FASB
      Accounting Standard Codification and the Hierarchy of Generally Accepted
      Accounting Principles”.InJune 2009, the FASB issued FASB ASC Topic 105, which
      became the source of authoritative GAAP recognized by the FASB to be
      applied bynongovernmental entities. Rules
      and interpretive releases of the SEC under authority of federal securities
      laws are also sources of authoritativeGAAP for SEC registrants. On the
      effective date of this FASB ASC Topic, the Codification will supersede all
      then-existing non-SEC accountingand reporting standards. All other
      non-SEC accounting literature not included in the Codification will becomenon-authoritative.
      This FASBASC Topic
      identify the sources of accounting principles and the framework for
      selecting the principles used in preparing the financialstatements of nongovernmental
      entities that are presented in conformity with GAAP. Also, arranged these sources of GAAP in a
      hierarchy forusers
      to apply accordingly. In other words, the GAAP hierarchy will be modified
      to include only two levels of GAAP: authoritative and non-authoritative.
      This FASB ASC Topic is effective for financial statements issued for interim and annual
      periods ending after September 15, 2009.The adoption of this topic did not
      have a material impact on the Company’s disclosure of the financial
      statements




10


·
            FASB ASC Topic
      320, “Recognition
      and Presentation of Other-Than-Temporary
      Impairments”.In April 2009, the FASB issued
      FASB ASCTopic 320
      amends the other-than-temporary impairment guidance in GAAP for debt
      securities to make the guidance more operational and toimprove the presentation and
      disclosure of other-than-temporary impairments on debt and equity
      securities in the financial statements. ThisFASB ASC Topic does not amend
      existing recognition and measurement guidance related to
      other-than-temporary impairments of equitysecurities. The FASB ASC Topic
      shall be effective
      for interim and annual reporting periods ending after June 15, 2009, with
      early adoptionpermitted for periods ending after
      March 15, 2009. Earlier adoption for periods ending before March 15, 2009,
      is not permitted. This FASB ASCTopic does not requiredisclosures for
      earlier periods presented for comparative purposes at initial adoption. In
      periods after initial adoption,this FASB ASC Topic requires
      comparative disclosures only for periods ending after initial adoption.
      The adoption of this Topic did not have amaterial impact on the
      Company’s financial statements and
      disclosures.




The Company is evaluating the impact
that the following recently issued accounting pronouncements may have on itsfinancial statements and
disclosures.




·
            FASB ASC Topic
      860, “Accounting for
      Transfer of Financial Asset”.,In June 2009, the
      FASB issued additional guidance under FASB ASCTopic 860, “Accounting for
      Transfer and Servicing of Financial Assets and Extinguishment of
      Liabilities", which
      improves the relevance,representational faithfulness, and
      comparability of the information that a reporting entity provides in its
      financial statements about a transfer offinancial assets; the effects of a
      transfer on its financial position, financial performance, and cash flows;
      and a transferor’s continuing involvement, if any,
      in transferred financial assets. The Board undertook this project to
      address (i) practices that have developed since theissuance of FASB ASC Topic 860,
      that are not consistent with the original intent and key requirements of that statement and
      (ii) concerns offinancial statement users that
      many of the financial assets (and related obligations) that have been
      derecognized should continue to bereported in the financial
      statements of transferors. This additional guidance requires that a transferor
      recognize and initially measure at fairvalue all assets obtained
      (including a transferor’s beneficial interest) and
      liabilities incurred as a result of a transfer of financial assetsaccounted for as a
      sale. Enhanced disclosures are required to provide
      financial statement users with greater transparency about transfers offinancial assets and
      a transferor’s continuing involvement with
      transferred financial assets. This additional guidance must be applied as
      of thebeginning of each reporting
      entity’s first annual reporting period
      that begins after November 15, 2009, for interim periods within that first
      annualreporting
      period and for interim and annual reporting periods thereafter. Earlier
      application is prohibited. This additional guidance must beapplied to transfers
      occurring on or after the effective
date.




·
            FASB ASC Topic
      810, “Variables
      Interest Entities”. In June 2009, the FASB issued
      FASB ASC Topic 810, which requires an enterprise toperform an analysis to determinewhether the
      enterprise’s variable interest or interests
      give it a controlling financial interest in a variable interestentity. This analysis
      identifies the primary beneficiary of a variable interest entity as the
      enterprise that has both of the followingcharacteristics: (i)The power to
      direct the activities of a variable interest entity that most
      significantly impact the entity’s economic performanceand (ii)The
      obligation to absorb losses of the entity that could potentially be
      significant to the variable interest entity or the right to
      receivebenefits from
      the entity that could potentially be significant to the variable interest
      entity. Additionally, an enterprise is required to assesswhether it has an implicit
      financial responsibility to ensure that avariable interest entity operates
      as designed when determining whether it hasthe power to direct the activities
      of the variable interest entity that most significantly impact the
      entity’s economic performance. This FASBTopic requires
      ongoing reassessments
      of whether an enterprise is the primary beneficiary of a variable interest
      entity and eliminate thequantitative approach previously
      required for determining the primary beneficiary of a variable interest
      entity, which was based on determiningwhich enterprise absorbs the majority of
      the entity’s expected losses, receives a
      majority of the entity’s expected residual returns, or
      both. This FASB ASC Topic shall be effective as of the beginning of each
      reporting entity’s first annual reporting period
      thatbegins after November 15,2009, for interim
      periods within that first annual reporting period, and for interim and
      annual reporting periods thereafter. Earlier application isprohibited.




·
            FASB ASC Topic
      740, “Income
      Taxes”, an Accounting Standard Update.
      InSeptember 2009,
      the FASB issued this Update to address the needfor additional implementation
      guidance on accounting for uncertainty in income taxes. Theguidance answers the following
      questions: (i) Is the income tax paid by the entity attributable to
      theentity or its
      owners? (ii) What constitutes atax position for a pass-through
      entity or a tax-exempt not-for-profit entity? (iii) How should accounting
      for uncertainty in income taxes be applied when a group of related
      entities comprise both taxable and nontaxable entities? In addition,
      this Updated decided to eliminate thedisclosures required by paragraph
      740-10-50-15(a) through (b) for nonpublic entities. The implementation
      guidance will apply to financialstatements of nongovernmental
      entities that arepresented in conformity with GAAP. The disclosure amendments will apply
      only to nonpublicentities as defined in Section
      740-10-20. For entities that are currently applying the standards for
      accounting for uncertainty in income taxes, theguidance and disclosure amendments are effective
      for financial statements issued for interim and annual periods ending
      after September 15,2009




11


Management does not believe that any
other recently issued, but not yet effective, accounting standards if currently
adopted would have a
material effect on the Company’s financial
statements




NOTE 4 –
COMMITMENTS




Administrative
Services




Commencing
on July 11, 2006, the effective date of the Offering, the Company was obligated
to pay an affiliate of the Company’s chief financial officer, $7,500 per month
for office, secretarial and administrative services. An amount of $0 and $17,903
for the three months ended October 31, 2009 and ,2008, respectively, is included
in general and administrative expenses on the accompanying condensed statements
of operations and $202,984 for period from Inception (August 1, 2005) to October
31, 2009. The administrative service agreement was terminated on October 18,
2008.




Financial Advisory
Services




HCFP was
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 would have paid HCFP a cash transaction fee of $1,500,000 upon
consummation of a Business Combination. The financial advisory service agreement
has been terminated.




Solicitation
Services




The
Company had 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 would have
paid HCFP a commission equal to 5% of the exercise price for each Class W
Warrant and Class Z Warrant exercised after July 10, 2007 if the exercise is
solicited by HCFP. No solicitation services were provided during the three
months ended October 31, 2009 and the agreement has been
terminated.




NOTE 5 – 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. No preferred shares were issued and
outstanding at October 31, 2009 or 2008.




Common Stock and Class B Common
Stock




The Company is authorized to issue
80,000,000 shares of common stock. As of October 31, 2009, there are 1,065,100
shares of the Company’s common stock issued and outstanding.
As of October 31, 2009, there are 46,967,900 authorized but unissued shares ofthe Company’s common stock 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 any Business Combination or future financing
of the Company. 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.




NOTE 6 – WARRANTS AND OPTION TO
PURCHASE COMMON STOCK




Warrants




In August
2005, the Company sold and issued Class W Warrants to purchase 2,475,000 shares
of the Company’s common stock, and Class Z Warrants to purchase 2,475,000 shares
of the Company’s common stock to its initial securityholders, for an aggregate
purchase price of $247,500, or $0.05 per warrant.




12


The Class
W and Class Z Warrants outstanding prior to the offering are also subject to a
registration rights agreement. On January 31, 2006, the Company and the initial
security holders entered into a registration rights agreement and a letter
agreement which revised the terms of the Company’s obligations under the warrant
and registration rights agreement to clarify that the Company will only deliver
unregistered common shares on the 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 security holders 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 to the registration rights agreement and the letter agreement on
January 31, 2006, the Company accounted for the Class W and Class Z Warrants
issued to the initial security holders 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 $247,500 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 are classified in stockholder’s
equity. For the period from inception (August 1, 2005) to October 31, 2009, 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 $247,500, 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 security holders is
exercisable with cash for one share of common stock. Except as set forth below,
the Class W Warrants entitle the holder to purchase shares at $5.00 per share,
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) July 10, 2007
and ending July 10, 2011. As of October 31, 2009 there were 12,711,000 Class W
Warrants outstanding.




Each
Class Z Warrant issued in the Offering and to the initial security holders is
exercisable with cash for one share of common stock. Except as set forth below,
the Class Z warrants entitle the holder to purchase shares at $5.00 per share,
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) July 10, 2007
and ending July 10, 2013. As of October 31, 2009 there were 7,800,000 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 security holders or their affiliates, shall
not be redeemable by the Company as long as such warrants continue to be held by
such security holders 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, 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.




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
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.




13


Underwriter Purchase
Option




In
connection with the Offering, the Company has issued to certain of the
underwriters the UPO for $100 to purchase up to 25,000 Series A Units at an
exercise price of $14.025 per unit and/or up to 230,000 Series B Units at an
exercise price of $16.665 per unit. The Series A Units and Series B Units
underlying the UPO will be exercisable in whole or in part, solely at HCFP’s
discretion, commencing on the later of (a) completion of a Business Combination
and (b) July 10, 2007 and ending July 10, 2011. The fair value of the UPO,
inclusive of the receipt of the $100 cash payment, has been accounted 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 computed
the fair value of the 25,000 Series A Units and 230,000 Series B Units
underlying the UPO was approximately $641,000 using a Black-Scholes
option-pricing model.




The fair
value of the UPO granted was estimated as of the date of grant using the
following assumptions: (1) expected volatility of 38.419%, (2) risk-free
interest rate of 5.10% 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.




During
the registration process for the offering, the Company amended the form of UPO
to clarify that 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.




14


Item 2.Management’s
Discussion and Analysis of Financial Condition and Results of
Operations




The following discussion and analysis of
our financial condition and results of operations should be read in conjunction
with our consolidated financial statements and related notes that appear
elsewhere in this report and in our annual report
on Form 10-K for the year ended July 31,
2009.




This report includes forward-looking
statements that are made pursuant to the safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. These forward-looking statements can
be identified by the use of words such as “anticipate,” “believe,” “estimate,”
“may,” “intend,” “expect,” “will,” “should,” “seeks” or other similar
expressions. Forward-looking statements reflect our plans, expectations and
beliefs, and involve inherent risks and uncertainties, many of which are beyond
our control. You should not place undue reliance on any forward-looking
statement, which speaks only as of the date made. Our actual results could
differ materially from those discussed in the forward-looking statements.
Factors that could cause or contribute to these differences include those
discussed below and elsewhere in this report, particularly in “Risk Factors” in
Item 1A of Part II.




General




We were formed on August 1, 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 which has operations or facilities located in Israel, or which is a
company operating outside of Israel which our management believes would benefit
from establishing operations or facilities in Israel.On July 18, 2006, we completed our
initial public offering of 500,000 Series A Units and 4,600,000 Series B
Units.   We have neither engaged in any operations, nor generated
any revenues, nor incurred any debt or expenses other than in connection with
our initial public offering and thereafter, expenses related to identifying and
pursuing acquisitions of targets and expenses related to liquidating our trust
fund for the benefit of our Class B common stockholders and reconstituting the
Company as an ongoing business corporation.  We have incurred expenses
only in connection with (i) the preparation and filing of our quarterly reports
on Form 10-Q, annual reports on Form 10-K and proxy statements in connection
with the February 16, 2009 Stockholders’ Meeting and (ii) travel expenses
related to finding and developing acquisition candidates.  Our travel
expense policies are consistent with good business practice, and we try to
minimize such costs to the extent possible.




At a special meeting of our stockholders
held on February 16, 2009, our stockholders approved a proposal to distribute
our trust fund for the benefit of our Class B common stockholders, without the
requirement that we dissolve and liquidate.  As a result of the
stockholder vote, we filed an amendment to our certificate of incorporation
which resulted in the cancellation of all shares of our Class B common stock,
and the conversion of those shares into the right to receive a pro rata share of
the trust fund distribution.  Thereafter, our Class B common stock and
Series B Units ceased to be quoted on the Over-The-Counter bulletin board and
ceased to trade or be tradable, and the trust fund was distributed to the
holders of Class B common stock.




At a continuation of the special
stockholder meeting held on February 17, 2009, our stockholders (then consisting
only of holders of common stock) approved proposals to amend and restate our
certificate of incorporation to (i) remove certain blank check company-related
restrictions, including provisions which required us to dissolve following the
distribution of the trust fund and provisions authorizing the Class B common
stock, and (ii) increase the authorized shares of common stock from 40,000,000
shares to 80,000,000 shares.  As a result of this stockholder vote, we
filed an amended and restated certificate of incorporation, which allowed us to
continue our corporate existence following the distribution of the trust
fund.




Our current plan is to acquire a target
company or business seeking the perceived advantages of being a publicly held
corporation. Our current business consists solely of identifying, researching
and negotiating the purchase of a business management deems to be in the best
interest of our shareholders.  Our principal business objective for
the next 12 months and beyond such time will be to achieve long-term growth
potential through a combination with a business rather than immediate,
short-term earnings.  We will not restrict our potential candidate
target companies to any specific business, industry or geographical location
and, thus, may acquire any type of business.  We cannot assure you
that we will be able to locate an appropriate target business or that we will be
able to engage in a business combination with a target business on favorable
terms.




Results of
Operations




Net loss for the three months ended
October 31, 2009 of $(9,286) consisted of professional fees of $8,380 and other
operating expenses of$906.




Net
income for the three months ended October 31, 2008 of $109,604 consisted of
interest income on the Trust Fund investment of $260,575 and interest on cash
and cash equivalents of $1,403, offset by professional fees of $100,870,
Delaware franchise taxes of $16,132 and other operating expenses of $35,372
which consist of $17,903 for a monthly administrative services agreement with an
affiliate, $14,954 for insurance, and $2,515 for other expenses.




15


Net income for the period from inception
(August 1, 2005) to October
31, 2009 of $2,116,548 consisted of interest income on the Trust Fund investment
of $3,623,908 and interest on cash and cash equivalents of $91,837, offset by
professional fees of $833,446, Delaware franchise taxes of
$229,520  and other operating expenses of $536,231, consisting
of $202,984 for a monthly administrative services agreement with an affiliate,
$224,840 for insurance, $68,124 for travel, and $ 40,283  for other
expenses.




Liquidity and Capital
Resources




We consummated our initialpublic offering of 500,000 Series A
units and 4,600,000 Series B units on July 18, 2006. On July 26, 2006, we
consummated the closing of an additional 32,500 Series A Units and 518,000
Series B Units that were subject to the over-allotment option.
Proceeds from our initial public offering were
approximately $52.9 million, net of underwriting and other expenses of
approximately $3.3 million, of which $51,691,800 was deposited into the trust
fund with American Stock Transfer & Trust Company as trustee, andthe remaining $1.2 million was held
outside of the trust fund. The proceeds held outside the trust are available to
be used by us, and are being used by us, to provide for business, legal and
accounting due diligence on prospective acquisitions and continuing general and administrative
expenses.  The proceeds held in the trust fund were distributed to our
Class B stockholders beginning on February 18, 2009 (see Note 3 to our audited
financial statements included elsewhere in this report).




As indicated in theaccompanying financial statements, at
October 31, 2009, we had $16,987 in cash, current liabilities of $63,701
and working capital deficit of
$46,714. Further, we have
incurred and expect to continue to incur costs in pursuit of acquisition plans.We believe that we will need to raise capital
to fund ongoing operations, and we may be unable to continue operations unless
further financings are consummated. Costs for ongoing operations are anticipated
to include the compliance cost of continuing to remainapublic reporting company, and costs to
fund the acquisition of an operating business. There is no assurance that our
plans to raise capital or to consummate a transaction will be
successful.




We do not currently have any specific
capital-raising plans. Wemay seek to issue equity securities,
including preferred securities for which we may determine the rights and
designations, common stock, warrants, equity rights, convertibles notes and any
combination of the foregoing. Any such offering may take the formof a private placement, public offering,
rights offering, other offering or any combination of the foregoing at fixed or
variable market prices or discounts to prevailing market prices. We cannot
assure you that we will be able to raise sufficient capitalon favorable, or any, terms. If the
proposals, discussed above, are approved we may be deemed to be a “blank check company”for purposes of the federal securities
laws. If we are deemed to be “blank check company”, regulatory restrictions that are more
restrictive than those currently set forth
in our certificate of incorporation may apply to any future public offerings by
us and may further limit our ability to raise funds for our
operations.




Item 4T.Controls and
Procedures




Evaluation of Disclosure Controls and
Procedures




We maintain disclosure controls and
procedures that are designed to ensure that information required to be disclosed
in our reports filed pursuant to theSecurities Exchange Act of 1934, as
amended, or Exchange Act,is recorded, processed, summarized and
reported within the time periods specified in the Securities and Exchange
Commission’s, or SEC, rules, regulations and related forms, and that such
information is accumulated and communicated to our sole officer to allow timely
decisions regarding required disclosure.




As of October 31, 2009, we carried out
an evaluation, under the supervision and with the participation of our sole
officer of the effectiveness of the design and operation of our disclosure
controls and procedures.  Based on this evaluation, our principal
executive officer and our principal financial officer concluded that our
disclosure controls and procedures were effective as of the end of the period
covered by this report.




Changes in Internal
Controls




There have been no changes in our
internal controls over financial reporting during the quarter ended October 31,
2009 that have materially affected or are reasonably likely to materially affect
our internal controls.




16


PART II




Item 1.Legal
Proceedings




To the knowledge of our officers and
directors, the Company is not a party to any legal proceeding or
litigation.




Item 1A.Risk
Factors




Item 1A. Risk Factors”of our annual report on Form 10-K
for the year ended July 31, 2009 includes a discussion of our risk
factors.  Except for the following, there have been no
material changes to risk factors as previously disclosed in our annual report on
Form 10-K filed with the Securities and Exchange Commission on December 2,
2009:




Quotation onOver-the-Counter bulletin
board




Our outstanding common stock and units are currently
quoted on theOver-the-Counter bulletin
board. We cannot assure you
that our common stock or units will continue to be quoted on theOver-the-Counter bulletin
board. To continue trading
on theOver-the-Counter
bulletin board, we must continue to timely file public
reports and satisfy theOver-the-Counter bulletin
board’s minimum stockholder requirements. We
believe that theOver-the-Counter bulletin boardunofficially requires at
least 35 to 40 stockholders with at least 100 tradable shares each (known as
“round lot”shareholders) to allow a stock to trade
there. Concurrent with our initial public offering, we filed a registration
statement on Form 8-A with the SEC registering the common stock and other
outstanding securities under Exchange
Act.  While such registration is in effect, we are a reporting company
under the federal securities laws.  At this time, we have no intention
of seeking to deregister our common stock under the Exchange Act and plan to
continue to file public reports as long as such
registration is in effect.  Nonetheless, we cannot assure you that our
common stock or warrants will remain eligible for quotation on theOver-the-Counter bulletin
board.




FI Investment Group., LLCcurrently owns a majorityof our outstanding common stock and, as
a result, has control over us, the election of our board of directors and our
management and policies.FI Investment Group., LLCalso has control over all matters
requiring stockholder approval, including the amendment of certain provisions of our
certificate of incorporation and bylaws, the approval of any equity-based
employee compensation plans and the approval of fundamental corporate
transactions, including mergers. In light of this control, other companies
could be discouraged from initiating a
potential merger, takeover or any other transaction resulting in a change of
control. Such a transaction potentially could be beneficial to our business or
to our stockholders. This may in turn reduce the price that investors are willing to pay in the future
for shares of our common stock.




Item 6.Exhibits




ExhibitNumber
                  
                  Exhibit3.1(1)
                  
                  Third
      Amended and Restated Certificate of Incorporation.3.2(2)
                  
                  Bylaws.31.1*
                  
                  Certification of Chief Executive
      Officer pursuant to
      Rules 13a-14 and 15d-14 promulgated under the Securities Exchange Act of
      1934.31.2*
                  
                  Certification of Chief Financial
      Officer pursuant to Rules 13a-14 and 15d-14 promulgated under the
      Securities Exchange Act of 1934.32.1*
                  
                  Certification of Chief Executive
      Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
      906 of the Sarbanes-Oxley Act of 2002.32.2*
                  
                  Certification of Chief Financial
      Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
      Section 906 of the
      Sarbanes-Oxley Act of
2002.




*
              Filed
      herewith.(1)
              Incorporated
      by reference to an exhibit to the Registrant’s Current Report on Form 8-K
      filed with the Commission on March 19, 2009.(2)
              Incorporated
      by reference to an exhibit to the Registrant’s Registration Statement of
      Form S-1 filed with the Commission on September 15,
  2005.


17


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.




ISRAEL
      GROWTH PARTNERS ACQUISITION CORP.By:
                /s/ J.
      Patrick McMahonJ.
      Patrick McMahonDirector, Chief Executive Officer, President, Chief FinancialOfficer,
      Secretary and TreasurerDate: 
      December 15, 2009


18


INDEX TO EXHIBITS




ExhibitNumber
                  
                  Exhibit3.1(1)
                  
                  Third
      Amended and Restated Certificate of Incorporation.3.2(2)
                  
                  Bylaws.31.1*
                  
                  Certification of Chief Executive
      Officer pursuant to Rules 13a-14 and 15d-14 promulgated under the
      Securities Exchange Act of 1934.31.2*
                  
                  Certification of Chief
      Financial Officer
      pursuant to Rules 13a-14 and 15d-14 promulgated under the Securities
      Exchange Act of 1934.32.1*
                  
                  Certification of Chief Executive
      Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
      906 of the Sarbanes-Oxley Act of 2002.32.2*
                  
                  Certification of Chief Financial
      Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section
      906 of the Sarbanes-Oxley Act of
2002.




*
              Filed
      herewith.(1)
              Incorporated
      by reference to an exhibit to the Registrant’s Current Report on Form 8-K
      filed with the Commission on March 19, 2009.(2)
              Incorporated
      by reference to an exhibit to the Registrant’s Registration Statement of
      Form S-1 filed with the Commission on September 15,
  2005.




19