UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
DC 20549




FORM
10-K




x
            ANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For The
fiscal year ended December 31, 2009


or





 ̈
            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: 000-52562




PINPOINT
ADVANCE CORP.


(Exact
name of registrant as specified in its charter)




Delaware
              33-1144642(State
      or other jurisdiction of
              (I.R.S.
      Employer Identification No.)incorporation
      or organization)




4
      Maskit StreetHerzeliya,
      Israel
              46700(Address
      of principal executive offices)
              (Zip
      Code)




972
9-9500245


Registrant’s
telephone number, including area code




Securities
registered pursuant to Section 12(b) of the Act: None




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




Title
of each Class


Common
Stock, $.0001 par value per share





Warrants
to purchase shares of Common Stock





Units,
each consisting of one share of Common Stock and one Warrant





Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.    Yes  ̈   No
x


Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Exchange
Act.    Yes  ̈  No x


Indicate
by check mark whether the registrant (1) has filed all reports required to
be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.     Yes x  No  ̈


Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of registrant’s knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  x


Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting company. See
definition of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act.


Large
      accelerated filer   ̈
              
              Accelerated
      filer   ̈Non-accelerated
      filer   ̈
              
              Smaller
      reporting company x


Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).    Yes  x    No   ̈.


The
aggregate market value of the outstanding common stock, other than shares held
by persons who may be deemed affiliates of the registrant, computed by reference
to the closing sales price for the Registrant’s Common Stock on June 30, 2009,
as reported on the OTC Bulletin Board, was approximately $0.


As of
March 22, 2010, there were 3,484,402 shares of common stock, par value $.0001
per share, of the registrant outstanding.


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 
 ̈     No
 ̈












TABLE OF
CONTENTS




PART
      IItem
      1.
                  Business
                  
                  2Item
      1A.
                  Risk
      Factors
                  
                  5Item
      1B.
                  Unresolved
      Staff Comments
                  
                  12Item
      2.
                  Properties
                  
                  12Item
      3.
                  Legal
      Proceedings
                  
                  12Item
      4.
                  Submission
      of Matters to a Vote of Security Holders
                  
                  13PART
      IIItem
      5.
                  Market
      For Registrant’s Common Equity, Related Stockholder Matters and Issuer
      Purchases of Equity Securities
                  
                  13Item
      6.
                  Selected
      Financial Data
                  
                  14Item
      7.
                  Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations
                  
                  14Item
      7A.
                  Quantitative
      and Qualitative Disclosures About Market Risk
                  
                  18Item
      8.
                  Financial
      Statements and Supplementary Data
                  
                  18Item
      9.
                  Changes
      in and Disagreements with Accountants on Accounting and Financial
      Disclosure
                  
                  18Item
      9A.
                  Controls
      and Procedures
                  
                  18Item
      9B.
                  Other
      Information
                  
                  19PART
      IIIItem
      10.
                  Directors
      and Executive Officers of the Registrant
                  
                  19Item
      11.
                  Executive
      Compensation
                  
                  22Item
      12.
                  Security
      Ownership of Certain Beneficial Owners and Management and Related
      Stockholder Matters
                  
                  22Item
      13.
                  Certain
      Relationships and Related Transactions
                  
                  23Item
      14.
                  Principal
      Accounting Fees and Services
                  
                  23PART
      IVItem
      15.
                  Exhibits
      and Financial Statement Schedules
                  
                  24









CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS




This
Annual Report on Form 10-K includes forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E
of the Securities Exchange Act of 1934, as amended. These forward-looking
statements can be identified by the use of forward-looking terminology,
including the words “believes,” “estimates,” “anticipates,” “expects,”
“intends,” “plans,” “may,” “will,” “potential,” “projects,” “predicts,”
“continue,” or “should,” or, in each case, their negative or other variations or
comparable terminology. Such statements include, but are not limited to, any
statements relating to our ability to consummate any acquisition or other
business combination and any other statements that are not statements of current
or historical facts. These statements are based on management’s current
expectations, but actual results may differ materially due to various factors,
including, but not limited to, our:




·
            being a development stage
      company with no operating
history;




·
            dependence on key personnel,
      some of whom may join us following an initial transaction, if
      any;




·
            personnel allocating their
      time to other businesses and potentially having conflicts of interest with
      our business;




·
            potentially being unable to
      obtain financing to complete an initial transaction, if
      any;




·
            limited pool of prospective
      target businesses;




·
            potential change in control if
      we acquire one or more target businesses for
  stock;




·
            delisting of our securities
      from the OTC Bulletin Board or our inability to have our securities quoted
      on the OTC Bulletin Board or any exchange  following a business
      combination;




·
            financial performance
      following an initial transaction, if any;
  or




·
            those other risks and
      uncertainties detailed in the Registrant’s filings with the Securities and
      Exchange Commission.




By
their nature, forward-looking statements involve risks and uncertainties because
they relate to events and depend on circumstances that may or may not occur in
the future. We caution you that forward-looking statements are not guarantees of
future performance and that our actual results of operations, financial
condition and liquidity, and developments in the industry in which we operate
may differ materially from those made in or suggested by the forward-looking
statements contained in this Annual Report on Form 10-K. In addition, even if
our results of operations, financial condition and liquidity, and developments
in the industry in which we operate are consistent with the forward-looking
statements contained in this Annual Report on Form 10-K, those results or
developments may not be indicative of results or developments in subsequent
periods.




These
forward-looking statements are subject to numerous risks, uncertainties and
assumptions about us described in our filings with the Securities and Exchange
Commission. The forward-looking events we discuss in this Annual Report on Form
10-K speak only as of the date of such statement and might not occur in light of
these risks, uncertainties and assumptions. Except as required by applicable
law, we undertake no obligation and disclaim any obligation to publicly update
or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.









PART
I




Item
      1.
            Business




Overview





Pinpoint
Advance Corp. (the “Company”, “we”, “our”, or “us”) was incorporated in Delaware
on September 6, 2006 as a blank check company for the purpose of acquiring,
merging with, engaging in a capital stock exchange with, purchasing all or
substantially all of the assets of, or engaging in any other similar business
combination (“Business Combination”) with a business that has operations or
facilities located in Israel or which is a company operating outside of Israel,
specifically in Europe, which management believes would benefit from
establishing operations or facilities in Israel, preferably in the technology
sector.  All activity from inception (September 6, 2006) through May
19, 2009 was related to the Company’s formation and capital raising activities
and seeking a suitable Business Combination.  Following the approval
of our stockholders to continue our existence at a meeting of stockholders held
on May 15, 2009, our objective is to achieve long-term growth potential through
one or more combinations with operating companies or businesses.  We will
not restrict our search for potential candidates to companies engaged in any
specific business, industry or geographical location and, thus, may acquire any
type of business.  We also will continue to pursue certain claims of
the Company against a third party, as described below.





The
Company’s current management continues to seek acquisition targets or other uses
for the Company, subject to several important factors, including the
availability of financing and the future role and level of involvement of the
Company’s current board of directors and management.  We cannot assure
you we will be able to acquire an operating business.  As an
alternative, the Company might seek to obtain value from its status as a public
company through a sale to or combination with a private operating company
seeking such status as a means of “going public.”  As of the date of
this annual report, the Company has no arrangements in place with any
acquisition candidates.




Our
executive offices are located at 4 Maskit Street, Herzeliya, Israel 46700 and
our telephone number at that location is 972 9-9500245. We currently have a
website at www.pinpointac.com and consequently we make available on the Internet
materials that we file with or furnish to the Securities and Exchange
Commission.  We will provide electronic or paper copies of such
materials free of charge upon request.





Business





The
Company’s principal activities from inception through May 19, 2009 were related
to the Company’s formation, capital raising activities and seeking and
attempting to close a Business Combination of the Company.  The
registration statement for the Company’s initial public offering was declared
effective on April 19, 2007 (“Offering”).  On April 25, 2007, the
Company completed a private placement (“Private Placement”) and received net
proceed of $1.5 million. The Company consummated the Offering on April 25, 2007
for net proceeds of approximately $27 million (including the over
allotment).





In the
Offering, the Company sold to the public 2,875,000 Units (the “Units” or a
“Unit”) at a price of $10.00 per Unit. Each Unit consisted of one share of
common stock and one warrant. Each warrant entitled the holder to purchase one
share of the Company's common stock at a price of $7.50. Proceeds from the
Offering and the private placement totaled approximately $28.5 million, which
was net of approximately $1.6 million in underwriting fees and other expenses
paid at closing.  The Company also sold to the underwriters for $100
an option to purchase up to 125,000 Units.




The
Company’s management intended to apply substantially all of the net proceeds of
the Offering toward consummating a Business Combination.


2




Management
had agreed that $28.37 million, or $9.91 per Unit sold in the Offering, was to
be held in a trust account (“Trust Account”) and invested in permitted United
States government securities, of which $0.30 per unit of the compensation to
underwriters was deferred until consummation of the Business
Combination.  The deferred compensation to underwriters was forfeited
due to the Company’s inability to consummate a Business Combination within the
time allotted in its amended and restated certificate of
incorporation.  All deferred legal fees and deferred underwriter fees
were distributed to stockholders as part of the trust distribution.





On
October 27, 2008, the Company announced it had executed a letter of intent to
effectuate a Business Combination with a privately-held company with its
headquarters in Israel (the “LOI”). All parties to the LOI negotiated the terms
of a definitive agreement and in fact, a definitive agreement (the “Agreement”)
was executed by all parties to the LOI. However, one of the parties (the
“Objecting Party”) to the Agreement claimed it never released its signature
thereto and has since indicated that it no longer wished to pursue the proposed
business combination.





The
Company believes a binding, definitive agreement was executed by all
parties.  However, because one of the parties had indicated its
position that no binding agreement existed and that it did not wish to continue
with negotiations, the Company determined to liquidate the Trust Account
established by the Company for the benefit of its public stockholders, and
return funds to the holders of shares of the Company’s common stock issued in
the Offering, in accordance with its Offering prospectus and the terms of its
amended and restated certificate of incorporation.





The
Company’s Amended and Restated Certificate of Incorporation provided for
mandatory liquidation of the Company in the event that the Company did not
consummate a Business Combination within 18 months from the date of the
consummation of its Offering, or 24 months from the consummation of the Offering
if certain extension criteria had been satisfied.  In October 2008 the
Company announced its termination of a letter of intent for potential business
combinations plans as well as its plan to distribute the amount held in the
Trust Fund to its stockholders and to adopt a plan for continued corporate
existence.





At a
Special Meeting held on May 15, 2009, a majority of the Company’s stockholders
voted in favor of the proposal to remove the blank check company restrictions
from the Company’s charter, thereby allowing the Company to continue its
corporate existence.





In
accordance with stockholder approval of the Company’s proposals, on May 19, 2009
the Company effectuated the redemption (“Redemption”) of the shares of common
stock issued in the Offering in the amount of $9.91 per share from the Trust
Account, and distributed one share of new common stock (“New Common Stock”) for
every eight shares of Company common stock redeemed, for an aggregate of 359,402
shares of New Common Stock.  The stockholders also approved the
creation of a new class of common stock called Class A Common Stock (“Class A
Stock”) and the Company’s founders exchanged each share of common stock held by
them for five shares of Class A Stock, for an aggregate of 3,125,000 shares of
Class A Stock.





On
December 8, 2009, the Company and others, filed a lawsuit against the Objecting
Party, Elbit Systems Holdings Ltd. ("Elbit") and others, in the Petah Tikva
District Court of Israel (“Court”), for damages in the amount of NIS 37.7
million (USD $10 million)  (the "Lawsuit"). The Lawsuit is based on
the following factual background:





a.
            That
      following a period of extensive negotiations between inter alia, the
      Company and Elbit, a July 2008 Letter of Intent was signed, which
      contemplated inter alia, the Company purchase from Elbit of 31% of
      Kinetics, Ltd., i.e. 18,716 Ordinary Shares of Kinetics Ltd. (the
      "Kinetics Shares"), for a price of $26 million.  Following said
      purchase, a merger between the Company and Kinetics was to be
      effectuated;




b.
            That
      the Company, as a blank check company and in order to fulfill its duty to
      obtain timely shareholders' approval, was compelled to finalize a Business
      Combination by October 18, 2008;




c.
            That
      based on the Letter of Intent, and a belief at the time of Elbit's good
      faith, the Company continued negotiating a definitive agreement with all
      parties involved in the
transaction;




d.
            That
      after lengthy negotiations, a definitive agreement was finalized and
      signed in early October 2008;




3


e.
            That
      Elbit's signature on the definitive agreement was withheld based on
      Elbit's claim that it had "just received" information about a new order
      that would raise the forecast of Kinetics' profits in
  2009;




The
Lawsuit seeks reparation for damages caused to plaintiffs as a result of
defendants' lack of good faith in negotiations, and requests that the Court hold
that defendants materially breached the definitive agreement, that defendants
are estopped from denying that the definitive agreement was finalized, and that
defendants acted with fraud, and alternatively, with recklessness. The Lawsuit
also alleges that Elbit was unjustly enriched by its conduct, and that any
enrichment as a result of Elbit's retention of the Kinetics Shares belongs to
the Company.





The
Lawsuit is in preliminary stages and the Company cannot determine on the
likelihood of success at the present time.




The
analysis of new business opportunities has and will be undertaken by or under
the supervision of our officers and directors.  We have unrestricted
flexibility in seeking, analyzing and participating in potential business
opportunities.  In our efforts to analyze potential target companies or
businesses, we will consider, among others, the following factors:




(i)
              Potential
      for growth, indicated by new technology, anticipated market expansion or
      new products;


(ii)
              Competitive
      position as compared to other firms of similar size and experience within
      the relevant industry segment as well as within the industry as a
      whole;


(iii)
                  Strength
      and diversity of management, either in place or scheduled for
      recruitment;


(iv)
              Capital
      requirements and anticipated availability of required funds, to be
      provided by us or from operations, through the sale of additional
      securities, through joint ventures or similar arrangements or from other
      sources;


(v)
              The
      cost of participation by us as compared to the perceived tangible and
      intangible
values;


(vi)
              The
      extent to which the business opportunities can be
      advanced;


(vii)
              The
      accessibility of required management expertise, personnel, raw materials,
      services, professional assistance and other required items;
      and


(viii)
              Other
      relevant factors that we
    identify.




In
applying the foregoing criteria, no one of which will be controlling, management
will attempt to analyze all factors and circumstances and make a determination
based upon reasonable investigative measures and available data. 
Potentially available business opportunities may occur in many different
industries, and at various stages of development, all of which will make the
task of comparative investigation and analysis of such business opportunities
extremely difficult and complex.  Due to our limited capital we may not
discover or adequately evaluate adverse facts about any opportunity evaluated
or, ultimately, any transaction consummated.





Form
of Acquisition




The
manner in which we participate in an opportunity will depend upon the nature of
the opportunity, our respective needs and desires and the promoters of the
opportunity, and our relative negotiating strength and that of such
promoters.





In the
event the Company enters into a definitive agreement to acquire an operating
company, the acquisition may not require stockholder approval, even if it
constituted a change in control of the Company, provided the Company’s common
stock is not then listed on a national exchange and the acquisition is
structured so as not to require a stockholder vote under the Delaware code.
Accordingly, shareholders may not be entitled to vote on any future acquisitions
by the Company.


4





It is
likely that we will acquire our participation in a business opportunity through
the issuance of our common stock or other securities.  Although the terms
of any such transaction cannot be predicted, it should be noted that in certain
circumstances the criteria for determining whether or not an acquisition is a
so-called “tax free” reorganization under Section 368(a)(l) of the
Internal Revenue Code of 1986, as amended (the “Code”), depends upon whether the
owners of the acquired business own 80% or more of the voting stock of the
surviving entity.  If a transaction were structured to take advantage of
these provisions rather than other “tax free” provisions provided under the
Code, our then-existing stockholders would, in such circumstances retain 20% or
less of the total issued and outstanding shares of the surviving entity. 
Under other circumstances, depending upon the relative negotiating strength of
the parties, our then-existing stockholders may retain substantially less than
20% of the total issued and outstanding shares of the surviving entity. 
This will result in substantial additional dilution to the equity of our
then-existing stockholders.




If we
were to pursue a “tax-free” reorganization as described above, our then-existing
stockholders would not have control of a majority of our voting shares following
a reorganization transaction.  As part of such a transaction, all or a
majority of our directors may resign and new directors may be appointed without
any vote by our stockholders.




In the
case of an acquisition of stock or assets not involving a statutory merger or
consolidation directly involving us, the transaction may be accomplished upon
the sole determination of management without any vote or approval by our
stockholders.  In the case of a statutory merger or consolidation directly
involving us, it will likely be necessary to call a stockholders’ meeting and
obtain the approval of the holders of a majority of our outstanding
shares.  The necessity to obtain such stockholder approval may result in
delay and additional expense in the consummation of any proposed transaction and
will also give rise to certain appraisal rights to dissenting
stockholders.  Most likely, management will seek to structure any such
transaction so that no stockholder approval is required.




It is
anticipated that the investigation of specific business opportunities and the
negotiation, drafting and execution of relevant agreements, disclosure documents
and other instruments will require substantial management time and attention and
substantial costs for third party professionals, accountants, attorneys and
others.  If a decision is made not to participate in a specific business
opportunity, these costs theretofore incurred in the related investigation would
not be recoverable.  Furthermore, even if an agreement is reached for the
participation in a specific business opportunity, the failure to consummate that
transaction may result in our loss of the related costs incurred.




We
presently have no employees apart from the officers named elsewhere
herein.  Our officers and directors are engaged in outside business
activities and anticipate that they will devote very limited time to our
business until a business opportunity has been identified.  We expect no
significant changes in the number of our employees other than such changes, if
any, incident to a business combination transaction.





Item
1A. Risk Factors




Statements
in this annual report on Form 10-K that are not strictly historical in nature
and are forward-looking statements. These statements may include, but are not
limited to, statements about the timing of the commencement, enrollment, and
completion of our clinical trials for our product candidates; the progress or
success of our product development programs; the status of regulatory approvals
for our product candidates; the timing of product launches; our ability to
protect our intellectual property, if any and operate our business without
infringing upon the intellectual property rights of others; and our estimates
for future performance, anticipated operating losses, future revenues, capital
requirements, and our needs for additional financing. In some cases, you can
identify forward-looking statements by terms such as “anticipates,” “believes,”
“could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,”
“predicts,” “projects,” “should,” “will,” “would,” “goal,” or other variations
of these terms (including their use in the negative) or by discussions of
strategies, plans or intentions. These statements are only predictions based on
current information and expectations and involve a number of risks and
uncertainties. The underlying information and expectations are likely to change
over time.


5




Factors
that could cause actual results to differ materially from what is expressed or
forecasted in our forward-looking statements include, but are not limited to,
the following:




Risks
Associated With Our Business




Our
business is difficult to evaluate because we have no operating
history.




As we
have no operating history or revenue and only minimal assets following the
liquidation of our Trust Account, there is a risk that we will be unable to
continue as a going concern and consummate a business combination
transaction.  We have had no recent operating history nor any revenues or
earnings from operations since inception.  Following the distribution of
the Trust Account, we have had no significant assets or financial
resources.  We will, in all likelihood, sustain operating expenses without
corresponding revenues, at least until the consummation of a business
combination transaction.  We cannot assure you that we can identify a
suitable business opportunity and consummate a business combination transaction
and, therefore, our net operating losses may increase
significantly.




Our
business will have no revenues unless and until we execute a business
combination transaction with an operating company or business.




We are a
development stage shell company and have had no revenues from operations. 
We may not realize any revenues unless and until we successfully execute a
business combination transaction with an operating company or
business.





There
is competition for those private companies suitable for a business combination
transaction of the type contemplated by management.




We are in
a highly competitive market for a small number of business opportunities which
could reduce the likelihood of consummating a successful business
combination.  We are and will continue to be an insignificant participant
in the business of seeking business combination transactions with small private
and public entities.  A large number of established and well-financed
entities, including small public companies and venture capital firms, are active
in mergers and acquisitions of companies that may be desirable target candidates
for us.  Nearly all these entities have significantly greater financial
resources, technical expertise and managerial capabilities than we do;
consequently, we will be at a competitive disadvantage in identifying possible
business opportunities and successfully completing a business combination. 
These competitive factors may reduce the likelihood of our identifying and
consummating a successful business combination transaction.





There
are relatively low barriers to becoming a blank check company or shell company, thereby increasing thecompetitive market for a small number of business
opportunities.





There are
relatively low barriers to becoming a blank check company or shell company. A
newly incorporated company with a single stockholder and sole officer and
director may become a blank check company or shell company by voluntarily
subjecting itself to the SEC reporting requirements by filing and seeking
effectiveness of a Form 10 with the SEC, thereby registering its common stock
pursuant to Section 12(g) of the Exchange Act. Assuming no comments to the Form
10 have been received from the SEC, the registration statement is automatically
deemed effective 60 days after filing the Form 10 with the SEC. The relative
ease and low cost with which a company can become a blank check or shell company
can increase the already highly competitive market for a limited number of
private businesses that seek to consummate a business combination with a public
company.




Because a
majority of our management's prior business experience has been limited to
segments of the technology industry, they may lack the necessary experience to
consummate an acquisition with a business in other segments or an alternative
industry.





A
significant portion of our management’s prior business experience has been
limited to certain segments of the technology industry, notably software,
telecommunication, media services, IT services, Internet and consumer products.
If we locate an attractive business combination unrelated to these segments of
the technology industry, our management may not have the necessary experience to
adequately assess the merits or risks of the industries or segments in which the
business operates.


6





We
have no existing agreement for a business combination or other
transaction.




We have
no arrangement, agreement or understanding with respect to engaging in a
business combination transaction with a private or public entity.  No
assurances can be given that we will successfully identify and evaluate suitable
business opportunities or that we will conclude a business combination
transaction.  Management has not identified any particular industry or
specific business within an industry for evaluation.  We cannot guarantee
that we will be able to negotiate a business combination transaction on
favorable terms, and there is consequently a risk that funds allocated to the
purchase of our shares will not be invested in a company with active business
operations.





The
time and cost of preparing the target to prepare financial statements necessary
to consummate a business combination with us may preclude us from entering into
a business combination transaction with the most attractive target
companies.




Target
companies that fail to comply with SEC reporting requirements may delay or
preclude a business combination transaction.  Sections 13 and 15(d) of
the Exchange Act require reporting companies to provide certain information
about significant acquisitions, including certified financial statements for the
acquired company, covering one, two, or three years, depending on the relative
size of the acquisition.  The time and additional costs that may be
incurred by some target entities to prepare such statements may significantly
delay or essentially preclude consummation of a business combination
transaction.  Otherwise suitable prospects that do not have or are unable
to obtain the required audited statements may be inappropriate for a business
combination transaction so long as the reporting requirements of the Exchange
Act are applicable.





Any
potential business combination transaction with a foreign company may subject us
to additional risks.




If we
enter into a business combination transaction with a foreign concern, we will be
subject to risks inherent in business operations outside of the United
States.  These risks include, for example, currency fluctuations,
regulatory problems, punitive tariffs, unstable local tax policies, trade
embargoes, risks related to shipment of raw materials and finished goods across
national borders and cultural and language differences.  Foreign economies
may differ favorably or unfavorably from the United States economy in growth of
gross national product, rate of inflation, market development, rate of savings,
and capital investment, resource self-sufficiency and balance of payments
positions, and in other respects.





Our
stockholders may be held liable for claims by third parties against us to the
extent of distributions received by them.




Under the
Delaware General Corporation Law, stockholders may be held liable for claims by
third parties against a corporation to the extent of distributions received by
them in the distribution of the Trust Account. If the corporation complies with
certain procedures set forth in Section 280 of the Delaware General Corporation
Law intended to ensure that it makes reasonable provision for all claims against
it, including a 60-day notice period during which any third-party claims can be
brought against the corporation, a 90-day period during which the corporation
may reject any claims brought, and an additional 150-day waiting period before
any liquidating distributions are made to stockholders, any liability of
stockholders with respect to a liquidating distribution is limited to the lesser
of such stockholder’s pro rata share of the claim or the amount distributed to
the stockholder, and any liability of the stockholder would be barred after the
third anniversary of the dissolution. We did not comply with those procedures in
the liquidation and distribution of the Trust Account.  Because we did not
comply with Section 280, we obtained stockholder approval to comply with Section
281(b) of the Delaware General Corporation Law, requiring us to adopt a plan of
dissolution that will provide for our payment, based on facts known to us at
such time, of (i) all existing claims, (ii) all pending claims and (iii) all
claims that may be potentially brought against us within the subsequent 10
years. Because we are a blank check company, the claims that could be made
against us are significantly limited and the likelihood that any claim that
would result in any liability extending to the trust is minimal. However,
because we did not comply with Section 280, our public stockholders could
potentially be liable for any claims to the extent of distributions received by
them in the Trust Account liquidation and any such liability of our stockholders
will likely extend beyond the third anniversary of such dissolution.
Accordingly, we cannot assure you that third parties will not seek to recover
from our public stockholders amounts owed to them by us.


7





We
may choose to redeem our outstanding warrants at a time that is disadvantageous
to our warrant holders.





Subject
to there being a current prospectus under the Securities Act of 1933 as amended
(the “Securities
Act”) with
respect to the shares of common stock issuable upon exercise of the warrants, we
may redeem the warrants issued as a part of our Units at any time after the
warrants become exercisable in whole and not in part, at a price of $.01 per
warrant, upon a minimum of 30 days’ prior written notice of redemption, if and
only if, the last sales price of our common stock equals or exceeds $14.25 per
share for any 20 trading days within a 30 trading day period ending three
business days before we send the notice of redemption. Redemption of the
warrants could force the warrant holders (i) to exercise the warrants and pay
the exercise price thereafter at a time when it may be disadvantageous for the
holders to do so, (ii) to sell the warrants at the then current market price
when they might otherwise wish to hold the warrants, or (iii) to accept the
nominal redemption price which, at the time the warrants are called for
redemption, is likely to be substantially less than the market value of the
warrants. The foregoing does not apply to the 1,500,000 insider warrants
purchased by certain of our officers and directors prior to our IPO, as such
warrants are not subject to redemption while held by the initial holder or any
permitted transferee of such initial holder.





Although
we are required to use our best efforts to have an effective registration
statement covering the issuance of the shares underlying the warrants at the
time that our warrant holders exercise their warrants, we cannot guarantee that
a registration statement will be effective, in which case our warrant holders
may not be able to exercise our warrants.




Holders
of our warrants will be able to exercise the warrant only if (i) a current
registration statement under the Securities Act relating to the shares of our
common stock underlying the warrants is then effective and (ii) such shares are
qualified for sale or exempt from qualification under the applicable securities
law of the states in which the various holders of warrants reside. Although we
have undertaken in the warrant agreement, and therefore have a contractual
obligation, to use our best efforts to maintain a current registration statement
covering the shares underlying the warrants following completion of our IPO to
the extent required by federal securities law, and we intend to comply with such
undertaking, we cannot assure you that we will be able to do so. In addition, we
have agreed to use our reasonable efforts to register the shares underlying the
warrants under the blue sky laws of the states of residence of the exercising
warrant holders, to the extent an exemption is not available. The value of the
warrants may be greatly reduced if a registration statement covering the shares
issuable upon the exercise of the warrants is not kept current or if the
securities are not qualified, or exempt from qualification, in the states in
which the holders of warrants reside. Holders of warrants who reside in
jurisdictions in which the shares underlying the warrants are not qualified and
in which there is no exemption will be unable to exercise their warrants and
would either have to sell their warrants in the open market or allow them to
expire unexercised. If and when the warrants become redeemable by us, we may
exercise our redemption right even if we are unable to qualify the underlying
securities for sale under all applicable state securities laws.




Because
the warrants sold in the private placement were originally issued pursuant to an
exemption from the registration requirements under the federal securities laws,
holders of such warrants will be able to exercise their warrants even if, at the
time of exercise, a prospectus relating to the common stock issuable upon
exercise of such warrants is not current. As a result, the holders of the
warrants purchased in the private placement will not have any restrictions with
respect to the exercise of their warrants. As described above, the holders of
the warrants purchased in our IPO will not be able to exercise them unless we
have a current registration statement covering the shares issuable upon their
exercise.




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




Our
Second Amended and Restated Certificate of Incorporation authorizes the issuance
of up to 15,000,000 shares of common stock, par value $.0001 per share,
5,000,000 shares of Class A Stock, par value $.0001 per share, and 1,000,000
shares of preferred stock, par value $.0001 per share.  As of December
31, 2009, there were 14,640,598 authorized but unissued shares of our common
stock available for issuance, 1,875,000 shares of Class A Stock and all of the
1,000,000 shares of preferred stock available for issuance.  The
issuance of additional shares of our common stock, Class A Stock or any number
of shares of our preferred stock:


8




·
            may
      significantly reduce the equity interest of our
    stockholders;


·
              will
      likely cause a change in control if a substantial number of our shares of
      common stock are issued, which may affect, among other things, our ability
      to use our net operating loss carry forwards, if any, and most likely also
      result in the resignation or removal of our present officers and
      directors; and


·
              may
      adversely affect prevailing market prices for our common
      stock.




Additionally,
if we finance the purchase of assets or operations through the issuance of debt
securities, it could result in:




·
            default
      and foreclosure on our assets if our operating revenues after an
      acquisition were insufficient to pay our debt
  obligations;


·
              acceleration
      of our obligations to repay the indebtedness even if we have made all
      principal and interest payments when due if the debt security
      contained covenants that required the maintenance of certain financial
      ratios or reserves and any such covenant were breached without a waiver or
      renegotiation of that
covenant;


·
              our
      immediate payment of all principal and accrued interest, if any, if the
      debt security was payable on demand;
and


·
              our
      inability to obtain additional financing, if necessary, if the debt
      security contained covenants restricting our ability to obtain additional
      financing while such security was
outstanding.




We
may have insufficient resources to cover our operating expenses and the expenses
of consummating an acquisition.




Following
the distribution of the Trust Account, we are in need of additional financing to
fund our operating expenses.  If we do not have sufficient funds
available to fund our expenses, we may be forced to obtain additional financing,
either from our management or the existing stockholders or from third parties.
We may not be able to obtain additional financing and our existing stockholders
and management are not obligated to provide any additional financing. If we do
not have sufficient proceeds and cannot find additional financing, we may be
forced to dissolve and liquidate prior to consummating a business
combination.





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





To the
extent that additional financing proves to be unavailable when and if needed to
consummate a particular business combination, we would be compelled to
restructure the transaction or abandon that particular business combination and
seek an alternative target business candidate. In addition, if we consummate a
business combination, we may require additional financing to fund the operations
or growth of the target business. The failure to secure additional financing
could have a material adverse effect on the continued development or growth of
the target business. None of our officers, directors or stockholders is required
to provide any financing to us prior to, in connection with or after a business
combination.




9




Our
ability to effect a business combination and to execute any potential business
plan afterwards will be dependent upon the efforts of our key personnel, some of
whom may join us following a business combination and whom we would have only a
limited ability to evaluate.




Our
ability to effect a business combination will be totally dependent upon the
efforts of our key personnel. The future role of our key personnel following an
acquisition, however, cannot presently be fully ascertained. Although we expect
most of our management and other key personnel to remain associated with us
following an acquisition, we may employ other personnel following the business
combination. While we intend to closely scrutinize any additional individuals we
engage after a business combination, we cannot assure you that our assessment of
these individuals will prove to be correct. Moreover, our current management
will only be able to remain with the combined company after the consummation of
a business combination if they are able to negotiate terms with the combined
company as part of any such combination. If we acquired a target business in an
all-cash transaction, it would be more likely that current members of management
would remain with us if they chose to do so. If a business combination were
structured as a merger whereby the stockholders of the target company were to
control the combined company following a business combination, it may be less
likely that management would remain with the combined company unless it was
negotiated as part of the transaction via the acquisition agreement, an
employment or consulting agreement or other arrangement. The determination to
remain as officers of the resulting business will be made prior to the
completion of the transaction and will depend upon the appropriateness or
necessity of current management to remain. In making the determination as to
whether current management should remain with us following the business
combination, management will analyze the experience and skill set of the target
business’ management and negotiate as part of the business combination that
certain members of current management remain if it is believed that it is in the
best interests of the combined company post-business combination. If management
negotiates to be retained post-business combination as a condition to any
potential business combination, such negotiations may result in a conflict of
interest.





An
acquisition of an operating company may not require the approval of our
shareholders, so you may not be entitled to vote on such a business
combination.





In the
event the Company enters into a definitive agreement to acquire an operating
company, the acquisition may not require stockholder approval, even if it
constitutes a change in control of the Company, provided the Company’s common
stock is not then listed on a national exchange and the acquisition is
structured so as not to require a stockholder vote under the Delaware code.
Accordingly, shareholders may not be entitled to vote on any future acquisition
by, or of, the Company.




Other
than their relationship with us, none of our officers or directors has ever been
associated with a blank check company which could adversely affect our ability
to consummate a business combination.




Other
than their relationship with us, none of our officers or directors has ever been
associated with a blank check company. Accordingly, you may not have sufficient
information with which to evaluate the ability of our management team to
identify and complete a business combination. Our management’s limited
experience in operating a blank check company could adversely affect our ability
to consummate a business combination and force us to dissolve and
liquidate.




Our
officers and directors may allocate their time to other businesses thereby
causing conflicts of interest in their determination as to how much time to
devote to our affairs. This could have a negative impact on our ability to
consummate a business combination.




Our
officers and directors are not required to commit their full time to our
affairs, which may result in a conflict of interest in allocating their time
between our operations and other businesses. We do not intend to have any full
time employees prior to the consummation of a business combination. Each of our
officers are engaged in several other business endeavors and are not obligated
to contribute any specific number of hours per week to our affairs. If our
officers’ other business affairs require them to devote more substantial amounts
of time to such affairs, it could limit their ability to devote time to our
affairs and could have a negative impact on our ability to consummate a business
combination.  We cannot assure you that these conflicts will be
resolved in our favor.




If
our common stock becomes subject to the SEC’s penny stock rules, broker-dealers
may experience difficulty in completing customer transactions and trading
activity in our securities may be adversely affected.




After the
distribution of the Trust Account, our net tangible assets are less than
$5,000,000 and, if our common stock has a market price per share of less than
$5.00, transactions in our common stock may be subject to the “penny stock”
rules promulgated under the Securities Exchange Act of 1934, as amended. Under
these rules, broker-dealers who recommend such securities to persons other than
institutional accredited investors must:




·
            make
      a special written suitability determination for the
    purchaser;


·
              receive
      the purchaser’s written agreement to a transaction prior to
      sale;


10


·
            provide
      the purchaser with risk disclosure documents which identify certain risks
      associated with investing in “penny stocks” and which describe the market
      for these “penny stocks” as well as a purchaser’s legal remedies;
      and


·
              obtain
      a signed and dated acknowledgment from the purchaser demonstrating that
      the purchaser has actually received the required risk disclosure document
      before a transaction in a “penny stock” can be
  completed.




If our
common stock becomes subject to these rules, broker-dealers may find it
difficult to effectuate customer transactions and trading activity in our
securities may be adversely affected. As a result, the market price of our
securities may be depressed, and you may find it more difficult to sell our
securities.





Our
officers and directors currently own shares of our Class A Stock and thus may
influence certain actions requiring a stockholder vote.




Our
officers and directors collectively hold approximately 80% of our voting power
by virtue of their ownership of Class A Stock.  This ownership
interest, together with any other acquisitions of our shares of common stock (or
warrants which are subsequently exercised), could allow our officers or
directors to influence the outcome of matters requiring stockholder approval,
including the election of directors and approval of significant corporate
transactions after completion of our initial business combination. The interests
of our officers or directors and your interests may not always align and taking
actions which require approval of a majority of our stockholders, such as
selling our company, may be more difficult to accomplish.





If
our existing stockholders (including those officers and directors who have
purchased warrants in the private placement) exercise their registration rights,
it may have an adverse effect on the market price of our common stock and the
existence of these rights may make it more difficult to effect a business
combination.




Our
existing stockholders, including our officers and directors who have purchased
warrants in the private placement, are entitled to require us to register the
resale of such warrants as well as their shares of common stock at any time
after the date on which their shares are released from escrow. If such existing
stockholders exercise their registration rights with respect to all of their
shares of common stock (including those 1,500,000 shares of common stock
issuable upon exercise of warrants included as part of the insider warrants),
then there will be an additional 2,125,000 shares of common stock eligible for
trading in the public market and we will bear the costs of registering such
securities. The presence of this additional number of shares of common stock
eligible for trading in the public market may have an adverse effect on the
market price of our common stock. In addition, the existence of these rights may
make it more difficult to effectuate a business combination or increase the cost
of the target business, as the stockholders of the target business may be
discouraged from entering into a business combination with us or will request a
higher price for their securities as a result of these registration rights and
the potential future effect their exercise may have on the trading market for
our common stock.





There
has been a very limited public trading market for our securities, and the market
for our securities may continue to be limited and may be sporadic and highly
volatile.




Prior to
May 19, 2009, there was a limited public market for our common stock, which was
quoted on the Over the Counter Bulletin Board (“OTCBB”).  Following
the liquidation of our Trust Account, there has not been any public trading in
the common stock and sporadic trading in our warrants.  We cannot
assure you that an active market for our shares will be established or
maintained in the future.  If we are unable to establish a public
market for our common stock, holders will have no or limited
liquidity.  Holders of our common stock may have to bear a complete
loss of the value of their investment in us.




If we are
able to establish a public market, the market price of our common stock may be
volatile, which could cause the value of our common stock to
decline.  Securities markets experience significant price and volume
fluctuations.  This market volatility, as well as general economic
conditions, could cause the market price of our common stock to fluctuate
substantially.  Many factors beyond our control may significantly
affect the market price of our shares. These factors include:




·
                  price and volume fluctuations in
      the stock
markets;


11




·
                changes in our earnings or
      variations in operating
results;





·
              any shortfall in revenue or
      increase in losses from levels expected by securities
      analysts;





·
                changes in regulatory policies or
      law;





·
                operating performance of
      companies comparable to us;
and





·
                general economic trends and other
      external
factors.




Even if
an active market for our common stock is established, stockholders may have to
sell their shares at prices substantially lower than the price they paid for the
shares or might otherwise receive than if an active public market
existed.





Item
      1B.
            Unresolved
      Staff Comments.





Not
applicable.





Item
      2.
            Properties.





Until
October 25, 2008, the 18 month anniversary of the completion of our IPO, we
leased office space at which we maintain our executive offices at 4 Maskit
Street, Herzeliya, Israel. The costs for this space was included in the $7,500
per-month fee New Pole Ltd., an affiliate of Ronen Zadok, our Chief Financial
Officer, charged us for general and administrative services.  After
October 25, 2008 and until December 31, 2009, New Pole Ltd. continued to permit
our use of such space, and to provide us with general and administrative
services, upon the same terms and conditions.  Currently, New Pole
Ltd. permits our continued use of this space and provides general and
administrative services free of charge.  We consider our current
office space adequate for our current operations.




Item
      3.
            Legal
      Proceedings.





On
December 8, 2009, the Company, filed the Lawsuit. The Lawsuit is based on the
following factual background:





·
            Following a period
      of extensive negotiations between inter alia, the Company and Elbit, a
      July 2008 Letter of Intent was signed, which contemplated inter alia, the
      Company purchase from Elbit 31% of Kinetics, i.e. 18,716 Ordinary Shares
      of Kinetics Ltd. (the “Kinetics Shares”), for a price of $26
      million.  Following said purchase, a merger between the Company
      and Kinetics was to be
  effectuated;




·
            That
      the Company, as a blank check company and in order to fulfill its duty to
      obtain timely shareholders' approval, was compelled to finalize a Business
      Combination by October 18, 2008;




·
            That
      based on the Letter of Intent, and a belief at the time of Elbit's good
      faith, the Company continued negotiating a definitive agreement with all
      parties involved in the
transaction;




·
            That
      after lengthy negotiations, a definitive agreement was finalized, and
      signed in early October 2008;




·
            That
      Elbit's signature on the definitive agreement was withheld, based on
      Elbit's claim that it had "just received" information about a new order
      that would raise the forecast of Kinetics' profits in
  2009;




The
Lawsuit seeks reparation for damages caused to plaintiffs as a result of
defendants' lack of good faith in negotiations, and requests that the Court hold
that defendants materially breached the definitive agreement, that defendants
are estopped from denying that the definitive agreement was finalized, and that
defendants acted with fraud, and alternatively, with recklessness. The Lawsuit
also alleges that Elbit was unjustly enriched by its conduct, and that any
enrichment as a result of Elbit's retention of the Kinetics Shares belongs to
the Company.


12





The
Lawsuit is in preliminary stages and the Company cannot determine on the
likelihood of success at the present time.




Item
      4.
            Submission
      of Matters to a Vote of Security
Holders.




None.




PART
II




Item
      5.
            Market
      for Registrant’s Common Equity, Related Stockholder Matters and Issuer
      Purchases of Equity Securities.




Market
Information




Our
warrants are traded on the OTC Bulletin Board (“OTC BB”) under the symbols
PPACW.  On May 19, 2009, all Units were split into their respective
warrant and common stock.  On May 19, 2009, holders of the Company’s
common stock had their stock exchanged eight for one for shares of New Common
Stock.  On May 19, 2009, holders of our founder stock were issued
Class A Stock in exchange for such founder stock.  As of May 19, 2009,
there was no public market for our New Common Stock and Class A
Stock.  Our warrants commenced public trading on June 1,
2007.  Following the distribution of the Trust Account on May 19,
2009, there has been no market for our warrants due to the sporadic and limited
trading in such warrants.





OTC Bulletin BoardPinpoint Advance
                                                              Corp.
                                                              Common Stock
                                                            
                                                            Pinpoint Advance
                                                              Corp. Warrants
                                                            
                                                            Pinpoint Advance
                                                              Corp.
                                                              UnitsHigh
                                                            
                                                            Low
                                                            
                                                            High
                                                            
                                                            Low
                                                            
                                                            High
                                                            
                                                            LowQuarter
      ended September 30, 2009
                                                            
                                                            $
                                                            9.85
                                                            
                                                            $
                                                            9.68
                                                            
                                                            $
                                                            —
                                                            
                                                            $
                                                            —
                                                            
                                                            $
                                                            —
                                                            
                                                            $
                                                            —Quarter
      ended June 30, 2009
                                                            
                                                            $
                                                            9.99
                                                            
                                                            $
                                                            9.80
                                                            
                                                            $
                                                            —
                                                            
                                                            $
                                                            —
                                                            
                                                            $
                                                            —
                                                            
                                                            $
                                                            —Quarter
      ended December 31, 2008
                                                            
                                                            $
                                                            9.76
                                                            
                                                            $
                                                            9.28
                                                            
                                                            $
                                                            0.16
                                                            
                                                            $
                                                            0.0005
                                                            
                                                            $
                                                            10.105
                                                            
                                                            $
                                                            9.49Quarter
      ended September 30, 2008
                                                            
                                                            $
                                                            9.65
                                                            
                                                            $
                                                            9.28
                                                            
                                                            $
                                                            0.36
                                                            
                                                            $
                                                            0.27
                                                            
                                                            $
                                                            9.92
                                                            
                                                            $
                                                            9.73Quarter
      ended June 30, 2008
                                                            
                                                            $
                                                            9.60
                                                            
                                                            $
                                                            9.15
                                                            
                                                            $
                                                            0.50
                                                            
                                                            $
                                                            0.35
                                                            
                                                            $
                                                            9.85
                                                            
                                                            $
                                                            9.70Quarter
      ended March 31, 2008
                                                            
                                                            $
                                                            9.25
                                                            
                                                            $
                                                            9.15
                                                            
                                                            $
                                                            0.80
                                                            
                                                            $
                                                            0.50
                                                            
                                                            $
                                                            10.00
                                                            
                                                            $
                                                            9.70




Holders





On March
23, 2010, there were 6 holders of record of our common stock, including the
Class A Stock and five holders of record of our
warrants.





Dividends





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


13





Recent
Sales of Unregistered Equity Securities





None.





Securities
Authorized for Issuance Under Equity Compensation Plans





None.





Repurchases
of Equity Securities





None.




Item
      6.
            Selected
      Financial Data




Not applicable.




Item
      7.
            Management’s
      Discussion and Analysis of Financial Condition and Results of
      Operations





Caution
Regarding Forward-Looking Information




Certain
statements contained in this annual filing, including, without limitation,
statements containing the words "believes", "anticipates", "expects" and words
of similar import, constitute forward-looking statements. Such forward-looking
statements involve known and unknown risks, uncertainties and other factors that
may cause the actual results, performance or achievements of the Company, or
industry results, to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements.




Such
factors include, among others, the following: international, national and local
general economic and market conditions: our ability to successfully make and
integrate acquisitions; existing government regulations and changes in, or the
failure to comply with, government regulations; adverse publicity; competition;
fluctuations and difficulty in forecasting operating results; changes in
business strategy or development plans; business disruptions; the ability to
attract and retain qualified personnel; and other factors referenced in this and
previous filings.




Given
these uncertainties, readers of this Form 10-K and investors are cautioned not
to place undue reliance on such forward-looking statements. The Company
disclaims any obligation to update any such factors or to publicly announce the
result of any revisions to any of the forward-looking statements contained
herein to reflect future events or developments.




The
following discussion should be read in conjunction with the Company’s Financial
Statements and footnotes thereto contained in this report.





Overview





We were
formed as a blank check company on September 6, 2006 for the purpose of
acquiring, merging with, engaging in a capital stock exchange with, purchasing
all or substantially all of the assets of, or engaging in any other similar
business combination with a business that has operations or facilities located
in Israel or which is a company operating outside of Israel, which management
believes would benefit from establishing operations or facilities in Israel,
preferably in the technology sector.  From inception to October 2008,
our principal business activities related to our formation, capital raising and
seeking a Business Combination target.





The
Company’s principal activities from inception through May 19, 2009 were related
to the Company’s formation, capital raising activities and the Business
Combination.





In the
Offering, the Company sold to the public 2,875,000 Units at a price of $10.00
per Unit. Each Unit consisted of one share and one warrant. Each warrant
entitled the holder to purchase one share of the Company's common stock at a
price of $7.50. Proceeds from the Offering and the Private Placement totaled
approximately $28.5 million, which was net of approximately $1.6 million in
underwriting fees and other expenses paid at closing.  The Company
also sold to the underwriters for $100 an option to purchase up to 125,000
Units.


14




The
Company had agreed that $28.37 million or $9.91 per Unit sold in the Offering,
was to be held in the Trust Account, of which $0.30 per Unit of the compensation
to underwriters was deferred until consummation of the Business
Combination.  The deferred compensation to underwriters was forfeited
due to the Company’s inability to consummate a Business Combination within the
time allotted in its Amended and Restated Certificate of
Incorporation.





On
October 27, 2008, the Company announced it had executed an LOI to effectuate a
Business Combination with Elbit.  All parties to the LOI negotiated
the terms of a definitive agreement and in fact, a definitive agreement was
executed by all parties to the LOI. However, Elbit claimed it never released its
signature thereto and indicated it no longer wished to pursue the proposed
Business Combination.





The
Company believes a binding, definitive agreement was executed by all
parties.  However, Elbit indicated its position that no binding
agreement existed and that it did not wish to continue with negotiations, the
Company was unable to consummate the Business Combination.





On
December 8, 2009, the Company and others, filed the Lawsuit.





The
Lawsuit seeks reparation for damages caused to plaintiffs as a result of
defendants' lack of good faith in negotiations and requests that the Court hold
that defendants materially breached the definitive agreement, that defendants
are estopped from denying that the definitive agreement was finalized, and that
defendants acted with fraud, and alternatively, with recklessness. The Lawsuit
also alleges that Elbit was unjustly enriched by its conduct, and that any
enrichment as a result of Elbit's retention of the Kinetics Shares belongs to
the Company.





The
Lawsuit is in preliminary stages, and the Company cannot determine on the
likelihood of success at the present time.





On May
19, 2009 the Company effectuated the redemption of the shares of common stock
issued in the Offering in the amount of $9.91 per share from the Trust Account
and distributed one share of New Common Stock for every eight common shares then
held for an aggregate of 359,402 shares of New Common Stock.  The
stockholders also approved the creation of a new class of common stock called
Class A Stock. The founders of the Company exchanged each share of common stock
held by them for five shares of Class A Stock, for an aggregate of 3,125,000
shares of Class A Stock.





Results
of Operations





Net
income (Loss) of $(45,682) and $(387,073) reported for the years ended December
31, 2009 and 2008 respectively, consists for each year primarily of $221,804 and
$805,334 of expenses for administrative services which consisted of $7,500 for
leased office space through December 2008; $22,290 and $43,775 for franchise
taxes; and $204,596 and $4,397 for federal income taxes,
respectively.  Changes to the franchise taxes for the 2009 tax year
include a tax credit which was not reflected in the 2008 tax
year.  Interest income from the Trust Account was $5,953 and $467,816
for the years ended December 31, 2009 and 2008 respectively.  The
change in interest income resulted from the Company’s distribution of cash held
in the Trust Account.





Gross
proceeds from the IPO were $30,250,000 (including the over-allotment option and
warrants sold privately). We paid a total of $1,349,900 in underwriting
discounts and commissions, and approximately $449,000 was paid for costs and
expenses related to the IPO. After deducting the underwriting discounts and
commissions and the offering expenses, the total net proceeds to us from the IPO
were approximately $28,451,000, of which $28,366,000 was deposited into the
Trust Account.  The remaining proceeds were used for business, legal
and accounting due diligence on prospective acquisitions and general and
administrative expenses prior to the redemption of the common
stock.


15





Commencing
on April 19, 2007 and terminating at the eighteen month anniversary of our IPO
in October 2008 and extended through December 2008, we began incurring a fee
from New Pole Ltd., an affiliate of Ronen Zadok, our chief financial officer, of
$7,500 per month for providing us with office space and certain general and
administrative services.  Currently, New Pole Ltd. permits our
continued use of the office space free of charge.  In addition, Mr.
Zadok advanced $151,210 to us for payment on our behalf of IPO expenses. This
amount was repaid following the IPO from the net proceeds of the
IPO.





On May
19, 2009 the Company effectuated the redemption of the shares of common stock
issued in the Offering in the amount of $9.91 per share from the Trust
Account.





Liquidity
and Capital Resources





At
December 31, 2009, the Company had $8,071 in cash, current liabilities of
$148,995 and working capital deficit of $64,182. Further, the Company has
incurred, and expects to continue to incur, costs. These factors, among others,
indicate that the Company may be unable to continue operations as a going
concern unless further financing from related parties is
consummated.  The Company did not hold any cash equivalents as of
December 31, 2009.





The
Company's restricted cash and cash equivalents was held in the Trust Account
until May 19, 2009 and was invested in a money market fund. The Company
recognized interest income of $1,359,678 from inception (September 6, 2006) to
May 19, 2009.  The Company distributed all cash from its Trust Account
as part of the Redemption.





The cash
and cash equivalent held in the Trust Account prior to May 19, 2009 was
generated by the proceeds from the Offering of approximately $28,750,000, the
proceeds of the sale of founder securities of $1,500,000, and $1,365,361 of
interest earned on the funds since the Offering.





The
warrants issued in the Offering are currently outstanding in accordance with
their terms and will become exercisable upon the consummation of any business
combination.





In
connection with the IPO, our underwriter agreed to defer payment of the
remaining three percent (3%) of the gross proceeds ($862,500) until completion
of a Business Combination. Due to the inability of the Company to consummate a
Business Combination, the 3% deferred fee was forfeited by the underwriter and
was returned to our public stockholders from the Trust Account upon the
distribution of the Trust Account.





Following
the distribution of the Trust Account, we are in need of additional financing to
fund our operating expenses.  If we do not have sufficient funds
available to fund our expenses, we may be forced to obtain additional financing,
either from our management or from third parties. We may not be able to obtain
additional financing and our existing stockholders and management are not
obligated to provide any additional financing.  If we do not have
sufficient proceeds and cannot find additional financing, we may be forced to
dissolve and liquidate prior to consummating a business
combination.





We may
need additional financing to complete a business combination.  We
cannot assure you that such financing would be available on acceptable terms, if
at all. To the extent additional financing proves to be unavailable when needed
to consummate a particular business combination, we would be compelled to
restructure the transaction or abandon that particular business combination and
seek an alternative target business candidate. In addition, if we consummate a
business combination, we may require additional financing to fund the operations
or growth of the target business.





Other
than contractual obligations incurred in the ordinary course of business, we do
not have any other long-term contractual obligations.


16





Critical
Accounting Policies





Our
financial statements have been prepared in accordance with accounting principles
generally accepted in the United States. These generally accepted accounting
principles require management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates. Our significant accounting policies are described
in the notes to the consolidated financial statements included in this report.
Judgments and estimates of uncertainties are required in applying our accounting
policies in many areas. Management has discussed the development and selection
of these policies with the Company’s Board of Directors and the Board of
Directors has reviewed the Company’s disclosures of these policies. There have
been no material changes to the critical accounting policies or estimates
reported in the Management’s Discussion and Analysis section of the audited
financial statements for the year ended December 31, 2008 as filed with the
Securities and Exchange Commission.





Recent
Accounting Pronouncements




In June
2009, the Financial Accounting Standards Board (FASB) issued the FASB Accounting
Standards Codification (“Codification”). The Codification became the single
authoritative source for US GAAP and changed the way in which the accounting
literature is organized. As applicable to the Company, the Codification became
effective commencing in the third quarter of 2009. The Codification does not
change US GAAP and does not have an effect on our financial position or results
of operations.




In May
2009, the FASB established a general standard of accounting for disclosure of
events that occur after the balance sheet date but before financial statements
are issued or are available to be issued. As applicable to the Company, this
standard became effective as of June 15, 2009. In accordance with this standard,
the Company has evaluated subsequent events up to the filing date of these
financial statements.




In April
2009, the FASB issued additional requirements regarding interim disclosures
about the fair value of financial instruments which were previously only
disclosed on an annual basis. Entities are now required to disclose the fair
value of financial instruments which are not recorded at fair value in the
financial statements in both interim and annual financial statements. The new
requirements were effective for interim and annual periods ending after June 15,
2009 on a prospective basis. There was no impact on the financial
results.





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





Off-Balance
Sheet Arrangements





None.





Contractual
Obligations





We do not
have any long term debt, capital lease obligations, operating lease obligations,
purchase obligations or other long term liabilities.  We entered into
a Service Agreement with New Pole Ltd., requiring us to pay $7,500 per
month.  The agreement terminated on the eighteen month anniversary of
our IPO in October 2008.  However, New Pole Ltd. continued to permit
our use of our office space and provided general and administrative services
upon the same terms and conditions until December 2008.  Currently,
New Pole Ltd. permits our continued use of this space free of
charge.


17





Other
than contractual obligations incurred in the ordinary course of business, we do
not have any other long-term contractual obligations.




Item
      7A.
            Quantitative
      and Qualitative Disclosure about Market
Risk




Not applicable.




Item
      8.
            Financial
      Statements and Supplementary Data




Reference
is made to our financial statements beginning on page F-1 of this
report.




Item
      9.
            Changes
      in and Disagreements with Accountants on Accounting and Financial
      Disclosure.




None.




Item
      9A.
            Controls
      and Procedures




Disclosure
Controls and Procedures





Evaluation
of Disclosure Controls and Procedures


Under the
supervision and with the participation of our management, including our Chief
Executive Officer and our Chief Financial Officer, (together, the “Certifying
Officers”), we carried out an evaluation of the effectiveness of the design and
operation of our disclosure controls and procedures as defined in Rules
13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”). Based on the foregoing, our Certifying Officers concluded
that our disclosure controls and procedures were effective as of the end of the
period covered by this quarterly report.





Disclosure
controls and procedures are controls and other procedures designed to ensure
that information required to be disclosed in our reports filed or submitted
under the Exchange Act is recorded, processed, summarized and reported within
the time periods specified in the SEC’s rules and forms.  Disclosure
controls and procedures include, without limitation, controls and procedures
designed to ensure that information required to be disclosed in our reports
filed or submitted under the Exchange Act is accumulated and communicated to
management, including our Certifying Officers, or persons performing similar
functions, as appropriate, to allow timely decisions regarding required
disclosure.





Management’s
Report on Internal Controls Over Financial Reporting




Our
Certifying Officers are responsible for establishing and maintaining adequate
internal control over financial reporting, as such term is defined in Rule
13a-15(f) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”).




Internal
control over financial reporting is promulgated under the Exchange Act as a
process designed by, or under the supervision of, our Certifying Officers and
effected by our board of directors, management and other personnel, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles and includes those policies and
procedures that:





·
            Pertain
      to the maintenance of records that in reasonable detail accurately and
      fairly reflect the transactions and dispositions of our
      assets;


18





·
            Provide
      reasonable assurance that transactions are recorded as necessary to permit
      preparation of financial statements in accordance with generally accepted
      accounting principles, and that our receipts and expenditures are being
      made only in accordance with authorizations of our management and
      directors; and





·
            Provide
      reasonable assurance regarding prevention or timely detection of
      unauthorized acquisition or disposition of our assets that could have a
      material effect on the financial
statements.





Readers
are cautioned that internal control over financial reporting, no matter how well
designed, has inherent limitations and may not prevent or detect misstatements.
Therefore, even effective internal control over financial reporting can only
provide reasonable assurance with respect to the financial statement preparation
and presentation.




Our
management, under the supervision and with the participation of our Certifying
Officers, has evaluated the effectiveness of our internal controls over
financial reporting as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) as
of the end of the period covered by this annual report based upon the framework
in Internal Control—Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO). Based on such evaluation, our
management has made an assessment that our internal control over financial
reporting is not effective as of December 31, 2009.




There is
a lack of segregation of duties at the Company due to the small number of
employees dealing with general administrative and financial matters and general
controls over information technology security and user access. This constitutes
a materialweakness
in internal controls over financial reporting. Furthermore, the Company’s Chief
Financial Officer is the only person with an appropriate level of accounting
knowledge, experience and training in the selection, application and
implementation of generally accepted accounting principles as it relates to
complex transactions and financial reporting requirements. Management will
continue to evaluate the segregation of duties issues considering the cost
involved to remediate them.





This
annual report does not include an attestation report of the Company’s registered
public accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by the Company’s registered
public accounting firm pursuant to temporary rules of the Securities and
Exchange Commission that permit the Company to provide only management’s report
in this annual report.





Changes
in Internal Controls





During
the quarter ended December 31, 2009, there have been no changes in our internal
control over financial reporting (as defined in Rule 13-15(f) of the Securities
Exchange Act) that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting.





Item
9B.  Other Information.





None.





PART
III





Item
10.  Directors, Executive Officers and Corporate
Governance.





Directors
and Executive Officers




Our
current directors and executive officers are listed below. None of such persons
are, or have been, involved with any other blank check
companies.


19




Name
                  
                  Age
                  
                  PositionAdiv
      Baruch
                  
                  48
                  
                  President,
      Chief Executive Officer and DirectorRonen
      Zadok
                  
                  50
                  
                  Chief
      Financial Officer, Secretary and DirectorYoav
      Schwalb
                  
                  50
                  
                  DirectorYaron
      Schwalb
                  
                  46
                  
                  Chief
      Technology Officer and
Director




Mr. Adiv Baruch has been our
President, Chief Executive Officer and a Director since inception. Since
February 2004, he has been a director, and from January 1, 2004 until November
2006, he served as the President and CEO, of B.O.S., a company publicly traded
on both NASDAQ and the Tel Aviv Stock Exchange (BOSC). Through its wholly owned
subsidiaries, B.O.S. delivers connectivity from IBM iSeries computers to
personal computers and mobile devices and provides solutions in RFID,
semiconductors, electronic components, CCD, imaging, networking, telecom and
automation. From 1999 to 2003, he served as Executive Vice President, Business
Development of Ness Technologies (NASDAQ: NSTC), an international provider of
comprehensive end-to-end IT services and solutions. Ness offers a unique global
delivery model of innovative, high-quality, value-added services that enable
organizations to attain sustainable competitive advantage. He has served as
founder and an executive or director for several information technology
companies and Internet start-ups. Mr. Baruch is actively involved as the
chairman of The Israel Export and International Cooperation Institute, Hi-Tech
and Telecom Division, and a board member of the IEIC. Mr. Baruch serves as a
director in several public and private companies, including., Rabintex
Industries Ltd, an international leading manufacturer of personal protection
equipment and armored systems and Tapuz, the Israeli community and mobile
portal, all of which are public traded companies listed on the Tel Aviv Stock
Exchange. He is also a director of Win Gaming Media, Inc., which is quoted on
the OTC Bulletin Board under the symbol WGMI. Win Gaming Media, Inc. is a
software and technology developer and provider to companies that service the
interactive gaming industry, delivering cross-platform systems that are built
for mass participation gaming over mobile devices, TV and the internet. Mr.
Baruch has a B.Sc. in Information Systems and Industrial Engineering from the
Technion - Israel Institute of Technology.  He is also Chairman of
Mate Video Analytics.  Since 2004 he has been a partner in Signum
Ltd.




Mr. Ronen Zadok has been our
Chief Financial Officer, Secretary and Director since inception. Since October
1999 to 2005 he has been a managing partner in Signum Ltd., a privately held
company focusing on turnaround management services for corporations. Currently,
he is a Director in Applisonix, a listed company on the Tel Aviv Stock Exchange
(TASE: APLS). He is also a managing partner of New Pole Ltd., a newly formed,
privately held investment company and, since 2005, a director of SiMetra Farm
Ltd., an Israeli biotech company. From October 2002 to May 2004, he was a
director of Ness Technologies (NASDAQ: NSTC). From 1995 to October 1999, Mr.
Zadok was CEO and a Director of Clal-Ipex, a joint venture company with Clal
(Israel's largest conglomerate at that time), specializing in IT professional
and outsourcing services. From July 1992 to 1995, Mr. Zadok was the CFO and
Co-Founder of Ipex Israel Ltd., a software and IT services company which was
acquired by Ness Technologies. From 1990 to 1992, Mr. Zadok was Director of
Marketing - financial services for Ipex ITG Australia, an IT products, services
and outsourcing company. Mr. Zadok holds a B.A. in Economics and Business
Administration, a B.A. in accounting and an MBA in finance and accounting, all
from Tel Aviv University.





Mr. Yoav Schwalb has been a
Director of our company since inception. From February 2004 to February 2005, he
served as a director of Volante (recently acquired by Commander Communications)
(ASX: CDR), one of Australia's largest information technology providers. Mr.
Schwalb has been a director of SiMetra Farm Ltd., an Israeli biotech company,
since 2006. From October 2002 through February 2004, Mr. Schwalb was an
Executive Vice President of Ipex ITG Australia, leading the business development
unit. In such capacity, Mr. Schwalb was charged with overall control of sales
and marketing as well as the development and initiation of new business areas.
From October 1999 to February 2002, he served as a Director of Ness Technologies
(NASDAQ: NSTC). From October 1993 to October 1999, Mr. Schwalb served as the CEO
and Director of Ipex Israel Ltd., an Israeli high-tech company (which later
merged with Ness Technologies). Yoav Schwalb is the brother of Yaron Schwalb,
our Chief Technology Officer and a director.





Mr. Yaron Schwalb has been our
Chief Technology Officer and a Director since inception. Mr. Schwalb has been a
director of SiMetra Farm Ltd., an Israeli biotech company, since 2006. From
February 2004 to September 2005, Mr. Schwalb was CTO and Technical Director of
the Ipex division of Volante (AMEX: VGL), one of Australia's largest information
technology providers. From 2006, he has served as a partner of New Pole Ltd., a
newly formed, privately held investment company. From 1985 to 2004, he was
co-founder and CTO of Ipex ITG Australia. Mr. Schwalb received his B.Com from
Melbourne University (Australia). Yaron Schwalb is the brother of Yoav Schwalb,
a director of our company.


20





Number
and Terms of Office of Directors.





Our board
of directors consists of four members: Messrs. Yaron Schwalb, Yoav Schwalb,
Adiv Baruch and Ronen Zadok.  Member of our board of directors will
serve for a term of one year or until the next annual meeting of our
stockholders at which their successors will be duly elected and
qualified.





None of
these individuals has been a principal of or affiliated with a public company or
blank check company that executed a business plan similar to our business plan
and none of these individuals is currently affiliated with such an
entity.





Section
16(a) Beneficial Ownership Reporting Compliance.





Section
16(a) of the Securities Exchange Act of 1934, as amended, requires our officers,
directors and persons who beneficially own more than ten percent of our common
stock to file reports of ownership and changes in ownership with the SEC. These
reporting persons are also required to furnish us with copies of all Section
16(a) forms they file.





To our
knowledge, based solely upon our review of the copies of such reports furnished
to us, we believe that all of our officers, directors and greater than ten
percent stockholders have complied with the applicable Section 16(a) reporting
requirements in a timely manner.





Board
Committees.





Our board
of directors in its entirety will act as the audit committee and compensation
committee.  We may establish an audit committee and a compensation
committee upon consummation of a business combination. At that time our board of
directors intends to adopt charters for these committees. Prior to such time we
do not intend to establish either one. Accordingly, there will not be a separate
committee comprised of some members of our board of directors with specialized
accounting and financial expertise to meet, analyze and discuss solely financial
matters concerning potential target businesses. We do not feel a compensation
committee is necessary prior to a business combination as there is no salary,
fees or other compensation being paid to our officers or directors prior to a
business combination other than as disclosed in this annual report.





The
Company has not implemented any changes to the procedures by which stockholders
may recommend nominees for the Company’s board of directors.





Audit
Committee Pre-Approval Policies




The Board
of Directors, which is performing the equivalent functions of an audit
committee, has pre-approved all audit services provided by the independent
auditors, and the compensation, fees and terms for such services. No permitted
non-audit services were provided or approved by the Board of
Directors.





Code
of Conduct.





We have
adopted a code of conduct and ethics applicable to our directors, officers and
employees in accordance with applicable federal securities laws.  We
have filed copies of our code of ethics and committee charters as an exhibit to
our registration statement on Form S-1, which we filed with the Securities and
Exchange Commission on October 20, 2006.  This document may be
reviewed by accessing such filing at the SEC Web site at
www.sec.gov.  In addition, a copy of the code of ethics shall be
provided without charge upon request to us.


21





Item
11. Executive Compensation.





The
Company’s officers and directors do not currently receive any compensation for
services rendered to the Company.  In future periods, subsequent to
the consummation of a business combination transaction, the Company anticipates
that it will pay compensation to its officers and directors.





Compensation
Committee Interlocks and Insider Participation





We do not
feel a compensation committee is necessary prior to a business combination as
there is no salary, fees or other compensation currently being paid to our
officers or directors other than as disclosed in this annual
report.  The entire board has reviewed and discussed the Compensation
Discussion and Analysis required by Item 402(b) of Regulation S-K with
management and based on the review and discussions of this item, the board of
directors believes the Compensation Discussion and Analysis be included in this
annual report.





Item 12. Security Ownership of Certain
Beneficial Owners and Management and Related Stockholder
Matters.




The
following table sets forth information regarding the beneficial ownership of the
New Common Stock and Class A Stock as of March 22, 2010, based on information
obtained from the persons named below, with respect to the beneficial ownership
of shares of such securities by:


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




•
              each
      of our officers and directors;
and


•
              all
      our officers and directors as a
group.





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





Beneficial
Ownership of Securities





Name and Address of Beneficial Owner (1)
                
                No. of Shares (2)
                
                
                Percentage of Common Stock (3)Ronen
      Zadok
                
                
                703,125
                
                
                
                4.02
                %Adiv
      Baruch
                
                
                703,125
                
                
                
                4.02
                %Yaron
      Schwalb
                
                
                703,125
                
                
                
                4.02
                %Yoav
      Schwalb
                
                
                703,125
                
                
                
                4.20
                %All
      directors and executive officers as a group
      (4 individuals)
                
                
                2,812,500
                
                
                
                80.72
                %





(1)
            Unless
      otherwise indicated, the business address of each of the individuals is 4
      Maskit Street, Herzeliya, Israel
46700.





(2)
            Unless
      otherwise indicated, all ownership is direct beneficial ownership of Class
      A Stock.





(3)
            The
      percentage ownership is calculated based on 3,484,402 shares of New Common
      Stock and Class A Stock that have voting rights and; does not include the
      shares of common stock underlying the insider warrants sold in the private
      placement.  Assumes that that none of the (a) 2,875,000 Warrants
      to purchase shares of our common stock included in the Company’s IPO units
      were exercised and (b) none of the 1,500,000 warrants to purchase shares
      of our common stock sold to our directors as described were
      exercised.


22





Item
13. Certain Relationships and Related Transactions, and Director
Independence.





Immediately
after our Offering, our existing stockholders, which include all of our officers
and directors, collectively, beneficially owned 20.0% of the then issued and
outstanding shares of our common stock. On May 19, 2009, our executive officers
and directors and their affiliates who purchased or received shares of our
common stock prior to our IPO, increased their beneficial ownership from 20% to
approximately 90% and the aggregate percentage of the Company’s outstanding
voting securities and the ownership of all other stockholders decreased from 80%
to approximately 10%.  Because of this ownership change, holders of
Class A Stock will be able to effectively influence the outcome of all matters
requiring approval by our stockholders, including the election of directors and
approval of significant corporate transactions other than approval of a business
combination.





Our
officers and directors or entities wholly owned by them, purchased equal amounts
of an aggregate of 1,500,000 warrants from us at a price of $1.00 per warrant in
a private placement prior to the commencement of our Offering.  Each
warrant is exercisable into one share of common stock at $7.50 and will become
exercisable on the later of (i) the completion of a business combination with a
target business or (ii) one year from the date of the prospectus, and expiring
four years from the date of the prospectus relating to our IPO. The insider
warrants will not be subject to redemption and may be exercised on a “cashless”
basis if held by the initial holder thereof or its permitted assigns. No
commissions, fees or other compensation will be payable in connection with such
private placement.





We have
granted the holders of such warrants demand and “piggy-back” registration rights
with respect to the shares of common stock underlying such warrants at any time
commencing on the date we announce we have entered into a letter of intent with
respect to a proposed a business combination, provided, however, any such
registration will not become effective prior to completion of our initial
business combination. The demand registration may be exercised by the holders of
a majority of such warrants. We will bear the expenses incurred in connection
with the filing of any such registration statements.





Messrs.
Baruch, Zadok, Yoav Schwalb, Yaron Schwalb and Perry are deemed our “parents”
and “promoters” as these terms are defined under the federal securities
laws.





Director
Independence.





Although
the Company’s securities are listed on the Over-the-Counter Bulletin Board and
we are therefore not required to have a majority of independent directors, we
apply the NYSE AMEX standard for independent directors to determine which, if
any, of our directors are independent pursuant to such
definition.  The NYSE AMEX defines an independent director generally
as a person other than an officer or employee of the company or its subsidiaries
or any other individual having a relationship, which, in the opinion of the
company’s board of directors would interfere with the director’s exercise of
independent judgment in carrying out the responsibilities of a
director.




The
Company has determined that all of our directors are not independent directors
as defined under the NYSE AMEX Rule 803.




Any
affiliated transactions will be on terms no less favorable to us than could be
obtained from independent parties. Any affiliated transactions must be approved
by a majority of our independent and disinterested directors.




Item
14.Principal
Accounting Fees and Services.





During
the fiscal year ended December 31, 2009, the firm of BDO Seidman LLP which
we refer to as BDO, was our principal accountant.  BDO manages and
supervises the audit and audit staff, and is exclusively responsible for the
opinion rendered in connection with its examination. The following is a summary
of fees paid or to be paid to BDO for services rendered.


23




Audit Fees. Audit fees
consist of fees billed for professional services rendered for the audit of our
year-end financial statements and services that are normally provided by BDO LLP
in connection with statutory and regulatory filings.  We have been
billed approximately $5,000 in connection with our December 31, 2009 year end
audit.




Audit-Related
Fees.  Audit-related services consist of fees billed for
assurance and related services that are reasonably related to performance of the
audit or review of our financial statements and are not reported under “Audit
Fees.”  These services include attest services that are not required
by statute or regulation and consultations concerning financial accounting and
reporting standards.  There were no aggregate fees billed for
audit-related services rendered by BDO.




Tax Fees. Fees for
professional services rendered by BDO for tax compliance, tax planning and tax
advice for the fiscal year ended December 31, 2009 were approximately
$5,000.





All Other
Fees.  There were no fees billed by BDO for any other
professional services rendered from the date of our inception through
December 31, 2009.





PART
IV





Item
15. Exhibits, Financial Statement Schedules.





(a)           The
following documents are filed as part of this report:





(1)           Financial
Statements.





The
following financial statements of the Company are referenced in Item 8 and
begin on page F-1 of this report:





PageReport
      of Independent Registered Public Accounting FirmBalance
      Sheets
                      
                      F-2Statements
      of Operations
                      
                      F-3Statements
      of Stockholders’ Equity
                      
                      F-4Statements
      of Cash Flows
                      
                      F-5Notes
      to Financial Statements
                      
                      F-6




24





(2) Financial Statement
Schedules.





All
schedules are omitted for the reason that the information is included in the
financial statements or the notes thereto or that they are not required or are
not applicable.





(3) Exhibits.





Exhibit No.
              
              Description1.1
              
              Underwriting
      Agreement. (1)3.1
              
              Second
      Amended and Restated Certificate of Incorporation. (5)3.2
              
              Bylaws.
      (2)4.1
              
              Specimen
      Unit Certificate. (2)4.2
              
              Specimen
      Common Stock Certificate. (2)4.3
              
              Specimen
      Warrant Certificate. (2)4.4
              
              Warrant
      Agreement between American Stock Transfer & Trust Company and the
      Registrant. (1)4.5
              
              Unit
      Option Purchase Agreement between the Registrant and Maxim Group LLC.
      (1)10.1.1
              
              Letter
      Agreement among the Registrant, Maxim Group LLC and Adiv Baruch.
      (2)10.1.2
              
              Letter
      Agreement among the Registrant, Maxim Group LLC and Yoav Schwalb.
      (2)10.1.3
              
              Letter
      Agreement among the Registrant, Maxim Group LLC and Ronen Zadok.
      (2)10.1.4
              
              Letter
      Agreement among the Registrant, Maxim Group LLC and Yaron Schwalb.
      (2)10.1.5
              
              Letter
      Agreement among the Registrant, Maxim Group LLC and Jacob Perry.
      (2)10.2
              
              Investment
      Management Trust Agreement between American Stock Transfer &
      Trust Company and the Registrant. (1)10.3
              
              Stock
      Escrow Agreement between the Registrant, American Stock
      Transfer & Trust Company and the founding stockholders.
      (1)10.4
              
              Registration
      Rights Agreement among the Registrant and the founding stockholders.
      (1)10.5
              
              Lease/Office
      Services Agreement dated October 18, 2006 by and among the Registrant and
      New Pole Ltd. (4)10.6
              
              Amended
      and Restated Subscription Agreement between the Registrant and certain
      officers and directors of the Registrant. (2)14
              
              Code
      of Ethics (3)23.1
              
              Consent
      of Ziv Haft, a BDO member firm.*31.1
              
              Certification
      of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley
      Act of 2002*31.2
              
              Certification
      of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley
      Act of 2002*32.1
              
              Certification
      of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted
      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
      to Section 906 of the Sarbanes-Oxley Act of
  2002*


*
              Filed
      herewith.


(1)
              Incorporated
      by reference to the Registrant’s Current Report on Form 8-K filed on April
      27, 2007.


(2)
              Incorporated
      by reference to the Registrant’s Registration Statement of Form S-1 filed
      on February 21, 2007.


(3)
              Incorporated
      by reference to the Registrant’s Registration Statement on Form S-1 filed
      on November 30, 2006.


(4)
              Incorporated
      by reference to the Registrant’s Registration Statement on Form S-1 filed
      on October 20, 2006.


(5)
              Incorporated
      by reference to the Registrant’s Proxy Statement on Form 14A filed on
      April 8, 2009.


25




PINPOINT ADVANCE
CORP.


(A
development stage corporation)




FINANCIAL
STATEMENTS


as
of December 31, 2009




In
U.S. Dollars




INDEX




PageReport
      of Independent Registered Public Accounting FirmBalance
      Sheets
                  
                  F-2Statements
      of Operations
                  
                  F-3Statements
      of Changes in Stockholders’ Equity
                  
                  F-4Statements
      of Cash Flows
                  
                  F-5Notes
      to Financial Statements
                  
                  F-6




F-1




PINPOINT
ADVANCE CORP.


(A
development stage corporation)


BALANCE
SHEETS





December 31,
                                    2009
                                  
                                  
                                  December 31,
                                    2008ASSETSCurrent
      assetsCash
                                  
                                  $
                                  8,071
                                  
                                  
                                  $
                                  8,380Deposit
                                  
                                  
                                  317
                                  
                                  
                                  
                                  317Cash
      held in trust (Note 1)
                                  
                                  
                                  -
                                  
                                  
                                  
                                  28,528,943Prepaid
      expense and other accounts receivable
                                  
                                  
                                  76,425
                                  
                                  
                                  
                                  11,111Total
      Assets
                                  
                                  $
                                  84,813
                                  
                                  
                                  $
                                  28,548,751LIABILITIES
      AND STOCKHOLDERS’ EQUITYCurrent
      LiabilitiesAccrued
      expenses and other accounts payable
                                  
                                  
                                  148,995
                                  
                                  
                                  
                                  76,001Common
      Stock subject to conversion
                                  
                                  
                                  -
                                  
                                  
                                  
                                  28,491,250Total
      current liabilities
                                  
                                  
                                  148,995
                                  
                                  
                                  
                                  28,567,251Commitments and Contingencies(Note 4)Stockholders’ Deficiency(Note 5)Preferred
      stock – $.0001 par value; 1,000,000 authorized; none issued or
      outstandingCommon
      stock $.0001 par value; 15,000,000 Authorized, 359,402 issued and
      outstanding;
                                  
                                  
                                  37Common
      stock, Class A, $0.0001 par value, 5,000,000 Authorized, 3,125,000 issued
      and outstanding; and 0 shares issued and outstanding
                                  
                                  
                                  313
                                  
                                  
                                  
                                  264Additional
      paid-in capital
                                  
                                  
                                  -
                                  
                                  
                                  
                                  -Deficit
      accumulated during the development stage
                                  
                                  
                                  (64,532
                                  )
                                  
                                  
                                  (18,764
                                  )Total
      stockholders’ deficit
                                  
                                  
                                  (64,182
                                  )
                                  
                                  
                                  (18,500
                                  )Total
      liabilities and stockholders' deficiency
                                  
                                  $
                                  84,813
                                  
                                  
                                  $
                                  28,548,751




The
accompanying notes should be read in conjunction with the financial
statements


F-2




PINPOINT
ADVANCE CORP.


(A
development stage corporation)


STATEMENTS
OF OPERATIONS





For the year
                  ended
                  December 31, 2009
              
              
              For the year
                  ended
                  December 31, 2008
              
              
              For the period from
                  September 6, 2006
                  (inception) to
                  December 31, 2008
              
              
              For the period from
                  September 6, 2006
                  (inception) to December
                  31, 2009State
      franchise tax
              
              $
              22,290
              
              
              $
              43,775
              
              
              $
              87,550
              
              
              $
              109,840Formation
      and operating costs
              
              
              
              
              
              
              —
              
              
              
              1,000
              
              
              
              1,000Other
      general and administrative expenses
              
              
              221,804
              
              
              
              805,334
              
              
              
              1,063,335
              
              
              
              1,285,139Bank
      charges
              
              
              231
              
              
              
              1,383
              
              
              
              2,670
              
              
              
              2,901Loss
      from operation
              
              
              (244,325
              )
              
              
              (850,492
              )
              
              
              (1,154,555
              )
              
              
              (1,398,880
              )Interest
      income
              
              
              (5,953
              )
              
              
              467,816
              
              
              
              1,365,631
              
              
              
              1,359,678Income
      (Loss) before provision for income tax
              
              
              (250,278
              )
              
              
              (382,676
              )
              
              
              211,076
              
              
              
              (39,202
              )Provision
      for income tax "(tax benefit)"
              
              
              (204,596
              )
              
              
              4,397
              
              
              
              209,040
              
              
              
              4,444Net
      (Loss) income for the period
              
              $
              (45,682
              )
              
              $
              (387,073
              )
              
              $
              2,036
              
              
              $
              (43,646
              )Accretion
      of trust fund relating to common stock subject to possible
      redemption
              
              
              —
              
              
              
              (115,735
              )
              
              
              (3,042
              )
              
              
              (3,042
              )Net
      (Loss) attributable to other common stockholders
              
              $
              (45,682
              )
              
              $
              (271,338
              )
              
              $
              (1,006
              )
              
              $
              (46,688
              )Net
      loss per shareBasic
      and Diluted
              
              $
              (0.02
              )
              
              $
              (0.28
              )Weighted
      average shares outstandingBasic
      and diluted
              
              
              2,941,820
              
              
              
              984,402Net
      loss per share subject to possible conversionBasic
      and diluted
              
              $
              —
              
              
              $
              (1.07
              )Weighted
      average shares outstanding subject to possible conversion
              
              
              —
              
              
              
              107,777Net
      loss per class A shareBasic
      and diluted
              
              $
              (0.02
              )
              
              $
              —Weighted
      average class A shares outstandingBasic
      and diluted
              
              
              1,957,480
              
              
              
              —




The
accompanying notes should be read in conjunction with the financial
statements


F-3





PINPOINT
ADVANCE CORP.


(A
development stage corporation)


STATEMENTS
OF CHANGES IN STOCKHOLDERS’ (DEFICIT) EQUITY


For
the period from September 6, 2006 (inception) to December 31, 2009





Common stock
                  
                  
                  Common stock, Class A
                  
                  
                  Additional
                  
                  
                  Deficit
                    accumulated
                    during the
                    development
                  
                  
                  Total
                    Stockholders’Shares
                  
                  
                  Amount
                  
                  
                  Shares
                  
                  
                  Amount
                  
                  
                  Paid-in capital
                  
                  
                  stage
                  
                  
                  equityBalance
      September 6, 2006 (inception)
                  
                  
                  —
                  
                  
                  $
                  —
                  
                  
                  
                  
                  
                  
                  
                  
                  $
                  —
                  
                  
                  $
                  —
                  
                  
                  $
                  —Common
      stock issued September 6, 2006 at $.0001per
      share
                  
                  
                  828,125
                  
                  
                  
                  83
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  24,917
                  
                  
                  
                  
                  
                  
                  
                  25,000Net
      loss for the period
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  
                  (8,140
                  )
                  
                  
                  (8,140
                  )Balances
      at December 31, 2006
                  
                  
                  828,125
                  
                  
                  
                  83
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  24,917
                  
                  
                  
                  (8,140
                  )
                  
                  
                  16,860Shares
      decreased as a result of a reverse split
                  
                  
                  (203,125
                  )
                  
                  
                  (20
                  )
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  20
                  
                  
                  
                  —
                  
                  
                  
                  —Proceeds
      from sale of underwriter’s purchase option
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  100
                  
                  
                  
                  —
                  
                  
                  
                  100Proceeds
      from issuance of warrants
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  1,500,000
                  
                  
                  
                  —
                  
                  
                  
                  1,500,000Sale
      of 2,875,000 units through public offering net of underwriter’s discount
      and offering expenses and net of $8,506,963 of proceeds allocable to
      862,212 shares of common stock subject to possible
    conversion
                  
                  
                  2,012,788
                  
                  
                  
                  201
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  17,475,949
                  
                  
                  
                  —
                  
                  
                  
                  17,476,150Net
      income for the period (audited)
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  397,249
                  
                  
                  
                  397,249Accretion
      of trust fund relating to common stock subject to possible
      conversion
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  (118,777
                  )
                  
                  
                  (118,777
                  )Balances
      at December 31, 2007
                  
                  
                  2,637,788
                  
                  
                  
                  264
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  19,000,986
                  
                  
                  
                  270,332
                  
                  
                  
                  19,271,582Net
      loss for the period (audited)
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  (387,073
                  )
                  
                  
                  (387,073
                  )Accretion
      of trust fund relating to common stock subject to possible
      conversion
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  115,735
                  
                  
                  
                  115,735Reclassification
      of underwriting and legal fees to additional paid-in
    capital
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  962,500
                  
                  
                  
                  —
                  
                  
                  
                  962,500Reclassification
      of common stock value subject toredemption
      to current liability
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  (19,963,486
                  )
                  
                  
                  (17,758
                  )
                  
                  
                  (19,981,244
                  )Balances
      at December 31, 2008
                  
                  
                  2,637,788
                  
                  
                  
                  264
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  (18,764
                  )
                  
                  
                  (18,500
                  )Reclassification
      of redeemable shares
                  
                  
                  862,212
                  
                  
                  
                  86
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  (86
                  )
                  
                  
                  —Shares
      decrease as a result of reverse split
                  
                  
                  (2,515,598
                  )
                  
                  
                  (251
                  )
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  251
                  
                  
                  
                  —
                  
                  
                  
                  —Return
      and cancellation of initial stockholders common stock
                  
                  
                  (625,000
                  )
                  
                  
                  (62
                  )
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  62
                  
                  
                  
                  —
                  
                  
                  
                  —Issuance
      of common stock to initial stockholders
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  3,125,000
                  
                  
                  
                  313
                  
                  
                  
                  (313
                  )
                  
                  
                  —
                  
                  
                  
                  —Net
      loss for the period (audited)
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  —
                  
                  
                  
                  (45,682
                  )
                  
                  
                  (45,682
                  )Balances
      at December 31, 2009
                  
                  
                  359,402
                  
                  
                  $
                  37
                  
                  
                  
                  3,125,000
                  
                  
                  
                  313
                  
                  
                  
                  —
                  
                  
                  $
                  (64,532
                  )
                  
                  $
                  (64,182
                  )


F-4





PINPOINT
ADVANCE CORP.


(A
development stage corporation)


STATEMENTS
OF CASH FLOWS





For the year
                                                                            Ended
                                                                            December 31, 2009
                                                                          
                                                                          
                                                                          For the year
                                                                            Ended
                                                                            December 31, 2008
                                                                          
                                                                          
                                                                          For the period from
                                                                            September 6, 2006
                                                                            (inception) to December
                                                                            31, 2008
                                                                          
                                                                          
                                                                          For the period from
                                                                            September 6, 2006
                                                                            (inception) to
                                                                            December 31, 2009OPERATING
      ACTIVITIESNet
      (Loss) income for the period
                                                                          
                                                                          $
                                                                          (45,682
                                                                          )
                                                                          
                                                                          $
                                                                          (387,073
                                                                          )
                                                                          
                                                                          $
                                                                          2,036
                                                                          
                                                                          
                                                                          $
                                                                          (43,646
                                                                          )Increase
      (Decrease) in accrued expenses and other accounts payable
                                                                          
                                                                          
                                                                          72,994
                                                                          
                                                                          
                                                                          
                                                                          (201,897
                                                                          )
                                                                          
                                                                          
                                                                          286,162
                                                                          
                                                                          
                                                                          
                                                                          359,156(Increase)
      Decrease in prepaid expenses
                                                                          
                                                                          
                                                                          (65,314
                                                                          )
                                                                          
                                                                          
                                                                          16,667
                                                                          
                                                                          
                                                                          
                                                                          (11,111
                                                                          )
                                                                          
                                                                          
                                                                          (76,425
                                                                          )(Increase)
      Decreaseininterestreceivable in
      trust
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          91,847
                                                                          
                                                                          
                                                                          
                                                                          —Net
      cash provided (used) in operating activities
                                                                          
                                                                          
                                                                          (38,002
                                                                          )
                                                                          
                                                                          
                                                                          (480,456
                                                                          )
                                                                          
                                                                          
                                                                          277,087
                                                                          
                                                                          
                                                                          
                                                                          239,085INVESTING
      ACTIVITIESCash
      contributed to Trust Fund
                                                                          
                                                                          
                                                                          28,528,943
                                                                          
                                                                          
                                                                          
                                                                          417,976
                                                                          
                                                                          
                                                                          
                                                                          (28,528,942
                                                                          )
                                                                          
                                                                          
                                                                          —Net
      cash used in investing activities
                                                                          
                                                                          
                                                                          28,528,943
                                                                          
                                                                          
                                                                          
                                                                          417,976
                                                                          
                                                                          
                                                                          
                                                                          (28,528,942
                                                                          )
                                                                          
                                                                          
                                                                          —FINANCING
      ACTIVITIESProceeds
      from issuance of common stock to initial stockholders
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          25,000
                                                                          
                                                                          
                                                                          
                                                                          25,000Proceeds
      from loans from related party
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          151,210
                                                                          
                                                                          
                                                                          
                                                                          151,210Payment
      of loans from related party
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          (151,210
                                                                          )
                                                                          
                                                                          
                                                                          (151,210
                                                                          )Deposit
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          (317
                                                                          )
                                                                          
                                                                          
                                                                          (317
                                                                          )Short
      term bank credit
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —Payment
      of Deferred offering cost
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          (210,161
                                                                          )
                                                                          
                                                                          
                                                                          (210,161
                                                                          )Proceeds
      from issuance of insider warrants
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          1,500,000
                                                                          
                                                                          
                                                                          
                                                                          1,500,000Proceeds
      from purchase of underwriter’s purchase option
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          100
                                                                          
                                                                          
                                                                          
                                                                          100Redemption
      of common stock
                                                                          
                                                                          
                                                                          (28,491,250
                                                                          )
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          (28,491,250
                                                                          )Portion
      of net proceeds from sale of units through public offering allocable to
      shares of common stock subject to possible conversion
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          8,506,963
                                                                          
                                                                          
                                                                          
                                                                          8,506,963Net
      proceeds from sale of units through public offering allocable
      to:
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —Stockholders’
      equity
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          18,438,650
                                                                          
                                                                          
                                                                          
                                                                          18,438,650Net
      cash provided by financing activities
                                                                          
                                                                          $
                                                                          (28,491,250
                                                                          )
                                                                          
                                                                          $
                                                                          —
                                                                          
                                                                          
                                                                          $
                                                                          28,260,235
                                                                          
                                                                          
                                                                          $
                                                                          (231,015
                                                                          )Net
      increase (Decrease) in cash
                                                                          
                                                                          $
                                                                          (309
                                                                          )
                                                                          
                                                                          $
                                                                          (62,480
                                                                          )
                                                                          
                                                                          $
                                                                          8,380
                                                                          
                                                                          
                                                                          $
                                                                          8,071CashBeginning
      of period
                                                                          
                                                                          
                                                                          8,380
                                                                          
                                                                          
                                                                          
                                                                          70,860
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —End
      of period
                                                                          
                                                                          $
                                                                          8,071
                                                                          
                                                                          
                                                                          $
                                                                          8,380
                                                                          
                                                                          
                                                                          $
                                                                          8,380
                                                                          
                                                                          
                                                                          $
                                                                          8,071Deferred
      legal fees against additional paid-in capital
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          100,000
                                                                          
                                                                          
                                                                          
                                                                          100,000Deferred
      underwriting fees against additional paid-in capital
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          862,500
                                                                          
                                                                          
                                                                          
                                                                          862,500Cash
      paid for income taxes
                                                                          
                                                                          
                                                                          25,205
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          —
                                                                          
                                                                          
                                                                          
                                                                          313,060Cash
      paid for interest
                                                                          
                                                                          
                                                                          5,953
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          
                                                                          5,953




The
accompanying notes should be read in conjunction with the financial
statements


F-5





PINPOINT
ADVANCE CORP.


(A
development stage corporation)




NOTES
TO FINANCIAL STATEMENTS




NOTE
1-DISCUSSION OF THE COMPANY’S ACTIVITIES




Organization and activities:
Pinpoint Advance Corp. (the “Company”) was incorporated in Delaware on September
6, 2006, as a blank check company that was formed for the purpose of acquiring,
merging with, engaging in a capital stock exchange with, purchasing all or
substantially all of the assets of, or engaging in any other similar business
combination with a business that has operations or facilities located in Israel
or which is a company operating outside of Israel, specifically in Europe, which
management believes would benefit from establishing operations or facilities in
Israel, preferably in the technology sector (“Target Business”). All activity
from inception (September 6, 2006) through December 31, 2009 was related to the
Company’s formation and capital raising activities and to seeking a business
combination. The Company has selected December 31 as its fiscal year
end.




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




The
registration statement for the Company’s initial public offering (“Offering”)
was declared effective on April 19, 2007. On April 25, 2007, the Company
completed a private placement ("Private placement") and received net proceeds of
$1.5 million. The Company consummated the Offering on April 25, 2007 for net
proceeds of approximately $27 million (including the over allotment).The
Company’s management intends to apply substantially all of the net proceeds of
the Offering toward consummating a Business Combination. The initial Target
Business must have a fair market value equal to at least 80% of our net assets
(excluding the amount held in the trust account representing a portion of the
underwriters’ deferred discount) at the time of such acquisition.




Management
has agreed that $28.37 million or $9.91 per Unit sold in the Offering was to be
held in a trust account (“Trust Account”) and invested in permitted United
States government securities, of which $0.3 per Unit will be paid to the
underwriter upon the consummation of a Business Combination. The placing of
funds in the Trust Account may not protect those funds from third party claims
against the Company. Although the Company sought to have all vendors,
prospective acquisition targets or other entities it engaged, execute agreements
with the Company waiving any right, title, interest or claim of any kind in or
to any monies held in the Trust Account, the Company may not have been
successful in obtaining all such agreements.




On
October 27, 2008, the Company announced it has executed a letter of intent to
effectuate a business combination with a privately-held company with its
headquarters in Israel (the "LOI"). All parties to the LOI negotiated the terms
of a definitive agreement and in fact, a definitive agreement (the "Agreement")
was executed by all parties to the LOI. However, one of the parties to the
Agreement claimed it never released its signature thereto and has since
indicated that it no longer wished to pursue the proposed business
combination.




The
Company believes a binding, definitive agreement was executed by all parties.
However, because one of the parties has indicated its position that no binding
agreement currently exists and that it did not wish to continue with
negotiations at this time, the Company determined to liquidate the trust account
established by the Company for the benefit of its public stockholders, and to
return funds to the holders of shares of the Company common stock issued in its
initial public offering, in accordance with its IPO prospectus and the terms of
its amended and restated certificate of incorporation. See Note 4 for a
description of the Lawsuit filed by the Company with respect
thereto.




At a
Special Meeting held on May 15, 2009, a majority of the Company stockholders
voted in favor of the proposal to remove the blank check company restrictions
from the Company’s charter, thereby allowing the Company to continue its
corporate existence. In accordance with stockholder approval of the Company’s
proposals, on May 19, 2009 the Company effectuated the redemption of the shares
of common stock issued in the Company’s initial public offering in an amount of
$9.91 per share from the Company’s trust account and distribution of one share
of new common stock for every eight shares of common stock not redeemed. The
stockholders also approved the creation of a new class of common stock called
Class A Common Stock and exchanged each share of common stock held by them for
five shares of Class A Common Stock. The Class A share rights are identical to
the New Common Stock rights




The
warrants that issued in the initial public offering remain outstanding with no
changes in the original terms.





Going concern consideration As
indicated in the accompanying financial statements, at December 31, 2009, the
Company had $8,071 in cash, current liabilities of $148,995 and working capital
deficit of $64,182. Further, the Company has incurred and expects to continue to
incur costs. These factors, among others, indicate that the Company may be
unable to continue operations as a going concern unless further financing from
related parties is consummated.


F-6





PINPOINT
ADVANCE CORP.


(A
development stage corporation)




NOTES
TO FINANCIAL STATEMENTS-Continued




NOTE
2-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES




Cash and Cash Equivalents—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. The Company did not hold any cash equivalents as of December 31,
2009.





Trust Account-The Company's
restricted cash and cash equivalents was held in the Trust Account until May 19,
2009 and was invested in a money market fund. The Company recognized interest
income $1,359,678 from inception (September 6, 2006) to May 19, 2009 on such
money market fund, which is included in interest income on the accompanying
statements of operations.




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 may 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.





Net Income per Share-Basic
earnings (loss) per share are computed by dividing net income (loss) by the
weighted average number of shares of common stock outstanding during the period.
Basic earnings per share subject to possible conversion is calculated by
dividing accretion of Trust Account relating to common stock subject to possible
conversion by 862,212 common shares subject to possible conversion. Diluted
earnings per share reflect the additional dilution for all potentially dilutive
securities such as stock warrants and options. The effect of the 1,500,000
outstanding warrants, issued in connection with the private placement described
in Note 1 and the warrants issued in connection with the public offering has not
been considered in the diluted net earnings per share since the warrants are
contingently exercisable. The effect of the 125,000 units included in the
underwriters purchase option, as described in Note 5, along with the warrants
underlying such units, has not been considered in the diluted earnings per share
calculation since the market price of the unit was less than the exercise price
during the period.




Fair Value of Financial
Instruments-the fair values of the Company’s assets and liabilities that
qualify as financial instruments under ASC 825 "Financial Instrument" (SFAS No.
107) “Disclosures about Fair Value of Financial Instrument,” approximate their
carrying amounts presented in the balance sheet at December 31,
2009.




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 effect certain reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenue and expenses during
the reporting period. Actual results could differ from those
estimates.




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


F-7





PINPOINT
ADVANCE CORP.


(A
development stage corporation)




NOTES
TO FINANCIAL STATEMENTS-Continued




NOTE
2-SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)




New
Accounting Pronouncements




In June
2009, the Financial Accounting Standards Board (FASB) issued the FASB Accounting
Standards Codification (“Codification”). The Codification became the single
authoritative source for US GAAP and changed the way in which the accounting
literature is organized. As applicable to the Company, the Codification became
effective commencing in the third quarter of 2009. The Codification does not
change US GAAP and does not have an effect on our financial position or results
of operations.




In May
2009, the FASB established a general standard of accounting for disclosure of
events that occur after the balance sheet date but before financial statements
are issued or are available to be issued. As applicable to the Company, this
standard became effective as of June 15, 2009. In accordance with this standard,
the Company has evaluated subsequent events up to the filing date of these
financial statements.




In April
2009, the FASB issued additional requirements regarding interim disclosures
about the fair value of financial instruments which were previously only
disclosed on an annual basis. Entities are now required to disclose the fair
value of financial instruments which are not recorded at fair value in the
financial statements in both interim and annual financial statements. The new
requirements were effective for interim and annual periods ending after June 15,
2009 on a prospective basis. There was no impact on the financial
results.





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




NOTE
3-DEFFERED UNDERWRITING FEE




In
connection with the Offering, the Company entered into an underwriting agreement
(the “Underwriting Agreement”) with the underwriters in the
Offering.




Pursuant
to the Underwriting Agreement, the Company was obligated to the underwriters for
certain fees and expenses related to the Offering, including underwriting
discounts of $2.2 million (with over allotment exercised). The Company paid $1.4
million, of the underwriting discount upon closing of the Offering (including
the over allotment). The Company and the underwriters agreed that payment of the
balance of the underwriting discount of $862.5 thousand would be deferred until
consummation of the Business Combination.





In
connection with the Offering, the Company entered into an engagement agreement
(the “Engagement Agreement”) with its legal counsel in the Offering. 
Pursuant to the Engagement Agreement, the Company was obligated to its
legal counsel for certain fees and expenses related to the Offering, including
an aggregate legal fee of $250 thousands.  The Company paid $150
thousand, of the legal fee upon closing of the Offering.





The
Company was unable to consummate a business combination within the time allotted
and all deferred legal fees and deferred underwriter fees were distributed to
stockholders as part of the trust distribution.





As
discussed in note 1, those fees have been reclassified to the Additional Paid-in
capital and will not be payable upon liquidation.


F-8




PINPOINT
ADVANCE CORP.
 (A
development stage corporation)
  NOTES
TO FINANCIAL STATEMENTS-Continued




NOTE
4- COMMITMENTS AND CONTINGENCIES





On
December 8, 2009, the Company and others, filed a lawsuit against Elbit Systems
Holdings Ltd. ("Elbit") and others, in the Petah Tikva District Court of Israel,
for damages in the amount of NIS 37.7
million ($10 million) (the "Lawsuit"). The Lawsuit is based on the following
factual background:





·
            That
      following a period of extensive negotiations between inter alia, the
      Company and Elbit, a July 2008 Letter of Intent was signed, which
      contemplated inter alia, the Company purchase from Elbit of 31% of
      Kinetics, i.e. 18,716 Ordinary Shares of Kinetics Ltd. (the "Kinetics
      Shares"), in the amount of $
      26 million Following said purchase, a merger between the Company and
      Kinetics was to be
effectuated;






·
            That
      the Company, as a Blank Check company and in order to fulfill its duty to
      obtain timely shareholders' approval, was compelled to finalize the deal
      by October 18, 2008;




·
            That
      based on the Letter of Intent, and a belief at the time of Elbit's good
      faith, the Company continued negotiating a definitive agreement with all
      parties involved in the
transaction;




·
            That
      after lengthy negotiations, a definitive agreement was finalized, and
      signed, in early October 2008;




·
            That
      Elbit's signature on the definitive agreement was withheld, based on
      Elbit's claim that it had "just received" information about a new order
      that would raise the forecast of Kinetics' profits in
  2009;




The
Lawsuit seeks reparation for damages caused to plaintiffs as a result of
defendants' lack of good faith in negotiations, and requests that the Court hold
that defendants materially breached the definitive agreement, that defendants
are estopped from denying that the definitive agreement was finalized, and that
defendants acted with fraud, and alternatively, with recklessness. The Lawsuit
also alleges that Elbit was unjustly enriched by its conduct, and that any
enrichment as a result of Elbit's retension of the Kinetics Shares belongs to
the Company.





The
Lawsuit is in preliminary stages, and the Company cannot opine on the likelihood
of success at the present time.




NOTE
5-STOCKHOLDER’S EQUITY




In its
initial public offering, effective April 19, 2007 (closed on April 25,
2007), the Company sold to the public 2,875,000 Units (the “Units” or a “Unit”)
at a price of $10.00 per Unit. Each Unit consisted of one share and one warrant.
Each warrant entitles the holder to purchase one share of the Company's common
stock at a price of $7.50. Proceeds from the initial public offering and the
Private Placement totaled approximately $28.5 million, which was net of
approximately $1.6 million in underwriting fees and other expenses paid at
closing.




The
Company also sold to underwriters for $100 an option to purchase up to 125,000
Units.




On May
19, 2009, in accordance with stockholder consent, the Company effectuated the
exchange and redemption of its capital stock whereby holders of stock in the
Company’s initial public offering received one share of New Common Stock for
eight shares held and issued one share of Class A Common Stock for each share of
common stock purchased prior to the Company’s offering for an aggregate of
359,402 shares of New Common Stock and 3,125,000 shares of Class A Common Stock.
The Class A Share rights are identical to the new common share
rights.




The
warrants issued in the initial public offering remain outstanding with no
changes in the original terms.


F-9




PINPOINT
ADVANCE CORP.


(A
development stage corporation)




NOTES
TO FINANCIAL STATEMENTS-Continued




NOTE
6- WARRANTS AND OPTION TO PURCHASE COMMON STOCK




The
Company has agreed to pay the underwriter in the Offering an underwriting
discount of 7% of the gross proceeds of the Offering and a non-accountable
expense allowance of 1% of the gross proceeds (excluding the over-allotment
option) of the Offering. However, the underwriter has agreed that 3% of the
underwriting discounts will not be payable unless and until the Company
completes a business combination, and has waived its right to receive such
payment upon the Company’s liquidation if the Company is unable to complete a
business combination. The Company has sold to the Underwriter for $100, an
option to purchase up to 125,000 units at $11 per unit. The units issuable upon
exercise of this option are identical to those offered by the Public Offering.
This option commences on the later of the consummation of a business combination
or 180-days from the date of the prospectus with respect to the Proposed
Offering and expires five years from the date of the prospectus. The Company
estimates that the fair value of the Underwriter’s Option is approximately
$738.7 thousand ($5.91per Unit) using a Black-Scholes option-pricing model. The
fair value of the Underwriter's Option has been estimated using the following
assumptions: (1) expected volatility of 69.95% (2) risk-free interest rate of
4.8% and (3) contractual life of 5 years. The expected volatility in the
preceding sentence was calculated as an average of the volatilities of Israeli
technology companies with market capitalizations between $50 million - $100
million that trade on US Stock Exchanges. In calculating volatility for the
representative companies, the Company used daily historical volatilities for the
period of time equal to the term of the option (5 years) .The Company
has accounted for these purchase options as a cost of raising capital and
has included the instrument as equity in its financial statements. Accordingly,
there was no net impact on the Company’s financial position or results of
operations, except for the recording of the $100 proceeds from the
sale.




The
Company was unable to effectuate the Business Combination within the time
allotted and the deferred underwriting discount was distributed to stockholders
as part of the trust distribution. Immediately prior to the Initial Public
Offering the Company sold to certain of the initial Stockholders 1,500,000
warrants ("Private Warrants"), for an aggregate purchase price of $1.5 million.
All of the proceeds received from the sale of the Insider Units were placed in
the Trust Account. The Insider Units are identical to the units offered in the
Initial Public Offering except that the warrants included therein are not
redeemable while held by the insider or his permitted transferees. All of the
Company’s stockholders prior to the Proposed Offering (“Initial Stockholders”)
agreed to vote the shares of common stock owned by them immediately before the
offering and the private placement in accordance with the majority of the shares
of common stock voted by the public stockholders and the holders of the shares
of common stock included in the Insider Units agreed to vote in favor of a
business combination proposed to the Company’s stockholders. All of such holders
have waived their rights to participate in any liquidation distribution
occurring upon failure of the Company to consummate a business
combination.




The
public warrants, and the underwriter's unit purchase option and the warrants
included in the underwriter’s unit purchase option, are not subject to net cash
settlement in the event the Company is unable to maintain an effective 1933 Act
registration statement. The Company must use best efforts to file and maintain
the effectiveness of the registration statement for the warrants set forth above
as well as the securities issuable upon exercise of the underwriter’s unit
purchase option. Such warrants are only exercisable to the extent the Company is
able to maintain such effectiveness. The unit purchase option (but not the
underlying warrants), however, may be exercised by means of cashless exercise
even in the absence of an effective registration statement for the underlying
securities. If a holder of public warrants or the holder of the underwriter’s
unit purchase option, or warrants underlying the underwriter’s unit purchase
option, does not, or is not able to, exercise such warrants, underwriter’s unit
purchase option or warrants underlying such underwriter’s unit purchase option,
as applicable, such warrants, underwriter unit purchase option or underlying
warrants, as applicable, will expire worthless.


F-10




PINPOINT
ADVANCE CORP.


(A
development stage corporation)




NOTES
TO FINANCIAL STATEMENTS-Continued




NOTE
7-CAPITAL STOCK




Preferred
Stock




The
Company is authorized to issue up to 1,000,000 shares of Preferred Stock with
such designations, voting, and other rights and preferences as may be determined
from time to time by the Board of Directors




Common
Stock




On
February 20, 2007, the number of outstanding shares decreased from 828,125
shares to 625,000 shares as a result of a reverse split of the Company's common
stock.




On April
25, 2007, the number of outstanding shares was 3,125,000 after consummating the
initial public offering.




On May 2,
2007, the number of outstanding shares was 3,500,000 after exercising the
over-allotment option.




On May
19, 2009, the number of outstanding shares was decreased from 3,500,000 to
359,402 as a result of reverse split of 8 to 1 of the IPO shares, and as result
of returned cancellation of initial stockholders common stock




Class
A, Common Stock




On
May 19, 2009, the number of outstanding share was 3,125,000 after issuance of
common stock to initial stockholders.


F-11





SIGNATURES




Pursuant
to the requirements of Section 13 or 15(d) of the Securities Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.




PINPOINT
      ADVANCE CORP.By:
                /s/ Adiv BaruchDated:
      March 31, 2010
                
                Name:
      Adiv Baruch
                  Title:
      Chief Executive Officer
                  (Principal
      Executive Officer)





Pursuant to the requirements of the
Securities Exchange Act of 1934, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.





Signature
                          
                          Title
                          
                          Date/s/ Adiv Baruch
                          
                          President
      and Chief Executive Officer
                          
                          March
      31, 2010Adiv
      Baruch
                          
                          (principal
      executive officer)/s/Ronen
      Zadok
                          
                          Chief
      Financial Officer and Secretary
                          
                          March
      31, 2010Ronen
      Zadok
                          
                          (principal
      financial and accounting officer)/s/Yoav
      Schwalb
                          
                          Director
                          
                          March
      31, 2010Yoav
      Schwalb/s/Yaron
      Schwalb
                          
                          Director
                          
                          March
      31, 2010Yaron
      Schwalb